Random ramblings on affordability, income, and expected standards of living

[Alfred]

I was talking about housing with various folks this past week and one topic that came up was how there's opposition to market rate housing with the argument of "who can afford it?"  (this is especially common here in Berkeley). 

However, affordability is a factor of two things: Income, and amount of living space desired.  For various reasons, people in the Bay Area seem to be much more willing than the average American to share living space.  It's a combination of a communal culture, plus a lot of young people, immigrants, and other groups with a history of group living. 

Below is a chart of several common household types in the bay area, note how low on the affordability ladder the idealized 2-parent, 2-child household with solid upper middle class jobs falls. 

Household	Typical Salary of ONE person	Can afford this much rent	Bedrooms desired	Max Rent Per Bedroom	Comments
Single tech worker	$120,000	$3,000	1	$3,000
Student, middle class	Financial aid / student loans	$1,000	0.5	$2,000	Two people per bedroom
Communal household of 5 young adults, 3 singles + 1 couple	$48,000	$6,000	3	$2,000	Living room used as bedroom
Student, working class	Financial aid / loans / work	$500	0.33	$1,515	Three people per bedroom
Working class extended family, 4 adults + 2 kids	$30,000	$3,000	2	$1,500
Professional class early career nuclear family, 2 adults + 1 kid	$60,000	$3,000	2	$1,500
Retired couple, middle class with one pension	$30,000	$1,500	1	$1,500
Professional class mid career nuclear family, 2 adults + 2 kids	$80,000	$4,000	3	$1,333
Retired individual on Social Security only	Social Security	$500	1	$500
Working class single parent household, 1 adult + 2 kids	$30,000	$750	2	$375

Normally, if an American city became unappealing to middle class families, it would hollow out and collapse.  However, the Bay Area has figured out a way to have a strong economy without having to raise its own middle class children, by attracting young people from elsewhere.  While it might work economically, this understandably terrifies a large number of people in a very visceral way.

I think this is a big part of the opposition to upzoning single family zones - if some people consider a single family house with yard the only type of housing they're willing to live in, no amount of apartments or ADU's is going to help their situation. 

How do we overcome this?

Alfred

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[Robert R. Tillman]

Dear Alfred,

 

That is exactly why I designed my 75-unit rental project in the Mission with smaller sized units. Even when charging the same amount of rent on a per square foot terms, the units are more affordable. That is what has happened in most major cities around the world.

 

Sincerely,

 

Bob

 

 

Robert R. Tillman

RRT Partners LLC

14 Sunshine Ave.

Sausalito, CA 94965

415-332-9242 Telephone

415-332-2639 FAX

415-297-9242 Mobile

rr...@pacbell.net

 

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