Silicon Valley communities are having a difficult time catching up with the region's fast-paced economic growth. San Jose, the most populated city in the Bay Area, is especially feeling heavy pressure on housing and affordability, according to a San Jose council member.
Two complex issues San Jose is wrestling with are housing affordability and homelessness, San Jose Councilman Chappie Jones told REALTORS® at a local district meeting of the Silicon Valley Association of REALTORS®. Jones represents District 1, the western edge of San Jose bordering Santa Clara, Saratoga, Cupertino and Campbell.
The limited supply of housing inventory is unable to meet strong demand and this has caused home prices and rents to skyrocket. Even if homeowners want to sell their homes, they don't know where to go, said Jones.
Jones said the city's plan to create an "urban village," mixed-use transit-oriented infill sites that provide both housing and jobs, is not attracting many developers. Time is of essence since the housing affordability issue is impacting all age groups, including seniors and young adults, and leading to homelessness. The problem is becoming "massive" and contributing to the crime rate, said Jones.
There are 4,000 homeless in San Jose - 2,800 have no housing. Jones said the city is attempting to address the problem by building homeless shelters, but it will take at least 18 months before the shelters are completed. In the meantime, more tents are sprouting close to parks and bridges.
Housing is not just San Jose's problem. Other cities in the region are facing the same dilemma.
"If San Jose catches a cold, everyone gets sick," said Jones.
Jones said the housing pressure has led to strong forces pressing for rent control and just cause eviction. Landlords should be able to evict bad tenants for the good and safety of other tenants and the neighborhoods, said Jones, but he also noted there are bad actors on the landlord side, as well, who will abuse the system. He suggested partnering with other cities might be one way to come up with more comprehensive solutions to the problems.
According to the September California Rental Price Monitor produced by apartmentlist.com, although San Francisco is still ranked as having the highest rents statewide, with a median rent for a 2-bedroom at $4950, up 4 percent since September 2014, other Bay Area cities are surpassing that city's year-to-year rent growth. The average rent for a 2-bedroom unit in San Mateo increased 9.6 percent from a year ago; Mountain View, 9.6 percent; Sunnyvale, 6.7 percent; Santa Clara, 8 percent. In San Jose, the average rent for a 2-bedroom unit in September was $2,500, an increase of 10.4 percent from a year ago.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
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