LandWatch State of Monterey County Report 1998
3.11 Affordable Housing

Housing Needs

A key provision of California Housing Element Law is that each jurisdiction is responsible for providing housing that is affordable to all income groups. The Department of Housing and Community Development determines the regional share of the statewide housing need. The Association of Monterey Bay Area Governments (AMBAG) is responsible for allocating the region's share of the statewide housing need at the local level. The region is comprised of Monterey and Santa Cruz Counties.

AMBAG completed the last Regional Housing Needs Plan in June 1990. (12) In Monterey County, the Plan identifies the need to construct 21,460 residential units between January, 1989 and July, 1996. Of these, 62% should have been "affordable," including 21% allocated to very low-income households, 18% to low-income households, and 23% to moderate-income households (Table 9).

Table 9--Estimated Housing Need by Affordability Level
January 1, 1989 to July 1, 1996

Monterey County calculates low-and-moderate-income home prices based on a number of assumptions. An "affordable" unit must be priced so that, at maximum, the units are affordable to lower-income households (income up to 80% of Department of Housing and Urban Development (HUD) or County Planning Area median household income, whichever is less, as adjusted by household size). To calculate affordable ranges, the County assumes a 30-year mortgage, a 7.5% interest rate, a 90% loan/value ratio, $100/month in property taxes, and standard loan underwriting criteria. The selling prices for affordable ranges have been calculated for very low, low, and moderate income categories based on 1998 HUD incomes for two-person and five-person households. These are as follows:

Table 10--Low-And-Moderate-Income Home Prices

Preliminary research indicates that affordable housing needs, as specified in the Regional Housing Needs Plan, have not been met. From 1989 through 1996, the Construction Research Industry Board's figures indicate that a total of 9,135 building permits were issued. (13) The approved building permits do not include projects currently pending or construction occurring in 1997. However, no agency tracks the total number of building permits issued for affordable housing within the County.

As a result, LandWatch asked each city and the County for the total number of very low-income, low-income, and moderate-income housing units constructed since 1990. In response, the cities of Monterey and Carmel provided data on constructed affordable housing units broken down by income level; the cities of King City, Gonzales, Greenfield, Salinas, and Soledad compiled information on the total affordable units constructed; and the City of Marina and the County of Monterey Planning and Building Inspection Department were unable to compile information on affordable units constructed. No affordable housing units were built in Del Rey Oaks, Pacific Grove or Sand City. Research shows there is no uniform methodology for local agencies to determine the construction of affordable housing units (Table 11).

The report on the construction of low-income housing units should not be interpreted as a comprehensive study on the total availability of low-income housing units throughout the county. For instance, converted units, rental units, and the housing market are not accounted for within these figures.

Table 11--Actual Housing Constructed by Income Category
January 1, 1990 to December 31, 1997

Low-income housing can be developed through the assistance of federal, state, and private agencies. Since the data on low-income housing by local jurisdictions is incomplete, LandWatch contacted the Community Housing Improvement Systems and Planning Association (CHISPA), a nonprofit developer of low-income housing in Monterey County, to request a list of projects and dwelling units which they have constructed since 1989 (Table 9). Of the units that were provided by the cities, the CHISPA projects account for 545. CHISPA has constructed a total of 643 units since 1989 (Table 12).

Table 12--CHISPA Project List 1989-1997