Ample bills show political will to incentivize housing in California

Ample bills show political will to incentivize housing in California
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There is ample political will to incentivize housing creation in California, as evidenced by the historic number of bills this year aiming to address the issue.

But creating diverse housing to meet citizens’ needs will require shedding unnecessarily restrictive, longstanding regulations, according to a recent panel discussion featuring Assemblymembers Pilar Schiavo (40th District) and Chris Ward (78th District).

Hosted by the Center for California Real Estate, an institute of the California Association of Realtors, the forum kicked off a three-day conference and was moderated by C.A.R. President Melanie Barker. Topics included insurance, the state budget, housing, homelessness and climate issues, among others.

Ward advocated for increasing housing supply “for every family of every part of the economic spectrum so that they have a place in California to call home.”

“I can tell you as the chair of the housing committee this year we’ve seen more pieces of legislation than ever,” he said, adding, “I perceive this as a good thing because we have a lot of colleagues who actually want to be a part of the solution and are presenting ideas.”

Schiavo spoke in favor of ongoing investment in housing creation, rather than just one-time or short-term investments. The assemblymembers also echoed the need to address various regulatory barriers to housing, from reevaluating CEQA and the Coastal Act to imposing penalties on frivolous lawsuits that seek to derail housing development.

“We’re getting to the point where we’re going to have to have a reckoning about how we want to address CEQA in a more holistic way,” Schiavo said. “It’s something that we want to make sure is there for the protection that is needed, but also not a barrier that delays projects for years and years because of frivolous lawsuits – that is the balance we really have to figure out.”

Ward said issues posed by the Coastal Act that have “been very much third rail” but must be addressed.

“We love our coastlines here, we want to make sure there’s access for everybody – but to have an almost duplicative land use process that is preventing reasonable development from being a part of that neighborhood too, when you’ve already baked in the tenets of the Coastal Act…we should not just turn a blind eye to three-year delays in something getting built,” Ward said.

Schiavo and Ward also offered an update on the ongoing home insurance crisis that has seen multiple insurers withdrawing from California in recent years. State Farm and Allstate pointed to wildfire risk and soaring inflation as factors in why they dropped policies or paused issuing new ones in the state. A broad coalition of real estate industry experts, customers and state officials are exploring ways to bring insurers back to the marketplace.

The assemblymembers advocated for the recommendation to allow insurers to set rates based upon catastrophe models rather than historic precedent, which is done in every other state other than California. They said that would help bring insurers back to the marketplace and ultimately drive down rates.

“C.A.R., along with other coalition partners, is lending its weight to support the regulations,” said Sanjay Wagle, a C.A.R. spokesperson. “The result should stabilize the market and allow for more companies to enter and come back.”

Despite existing regulations, progress is being made in housing creation in California. Ward notes how San Diego has about 9,000 units of housing under permit currently, when the city used to do 2,000 to 3,000 housing permits per year.

“And we are seeing a stabilization in the rents, because supply and demand is a real thing,” he said. “I do see a lot of political will and energy, but looking at the totality of the bills we are working on, it’s going to add up to turning the trend lines around and solving California’s housing crisis.”