In yesterday’s column we highlighted points made by Rich Rifkin on Measure R. He made the point, “Every proposal that has gone to the voters under Measure J/R has lost. Several others were abandoned along the way as bills mounted.”
His view: “It’s time we stop this nonsense. The process is too expensive in money and time.”
Mr. Rifkin brings up important points in his discussion of this issue. While I am not there yet in terms of getting rid of Measure R, I do believe there is a danger if the housing market remains bottled up, and I’ll explain shortly.
Reading Bob Dunning’s most recent column, where he highlights the council raises against the backdrop of the housing market, it seems clear that the worm is starting to turn in town as the housing crisis continues.
Mr. Dunning notes, “No-growth policies have been a consistent winner for a long time because they tend to unite conservatives and liberals in a way no other issue can.
“Conservatives, who like to build gated communities to protect themselves from the unwashed masses, have formed alliances with liberals who have decided that developers are, by definition, evil,” Mr. Dunning writes. “Throw in the false argument that our precious ag land is being eaten up by greedy developers, and you have a no-growth mentality that wins the day election after election after election.”
Mr. Dunning notes: “Pent-up demand for a spot in Davis has become so bad that even a slew of new homes in The Cannery has done nothing to cut into the escalating price of existing homes.”
Mr. Dunning believes it may be too late: “It’s the world we’ve created for ourselves and it’s much too late in the game to make our town truly affordable once again.”
The issue of Measure R and single-family homes are going to come, but they are not quite here yet. The big issue this election cycle is going to be student housing. I think the issue is
resolvable, but the stakes are actually quite high, as I’ll explain shortly.
We have repeatedly presented these numbers, but the current vacancy rate is somewhere between 0.3 and 0.4 percent. That’s slightly better than previously, but in real terms is no real change.
What is changing is that there is a solution within our grasp here. The university has committed to building 8500 beds on campus. If the city can follow through and approve the housing for Lincoln40, Plaza 2555, and Nishi, there will be another 4000 or so beds on top of Sterling. That gets us in the range of 13000 to 14000 new beds.
If we get there, I think we can get to the magic five percent vacancy rate and we can see a much healthier rental market. The surplus on the market will help bring down rental costs. And it may help free up single-family homes for families again.
But it is going to take a lot to get there. The community is going to have to pass a Measure R vote for the first time ever.
I have reason to believe this can and perhaps will occur. The first is, internally, the problems that beset the last Nishi project that lost narrowly have largely been addressed. There is no Richards Boulevard access to drive traffic concerns. There is now a good affordable housing plan that addresses those concerns. And they have at least reduced air quality concerns by making it rental housing only.
Still, as we witnessed this week, air quality concerns are going to dominate the electorate. And there are those who believe that all new student housing should be on campus, period.
The issue of affordability is likely to become much louder as projects come to the fore. Certain student groups ended up not supporting Nishi in 2016 because of its lack of affordable housing.
Josh Dalavai told the Vanguard that the push is now shifting to not only include a demand for student housing, but to make sure that that housing is affordable.
“We’re trying to hit really hard on affordability now,” he said. “Now more so than ever because it doesn’t do students much good if we just erect like ten West Villages and no one can actually afford to live there.”
He pointed out that anything market rate right now is going to be expensive. He also recognizes that that price could come down as the supply increases and the vacancy rate improves.
Clearly, creating more affordable housing options for students is important. But just as clear is the need to simply create more supply in order to allow market forces to drive down the costs.
Getting back to Measure R, I have continued to support Measure R for a few reasons. But what is clear is that the measure has created a bottleneck in the normal flow of development in this community. Ten years ago, when the voters voted down Measure X, that seemed quite reasonable. The community had just gone through rapid expansion, Covell Village was too massive and there was poor planning for traffic effects.
We then went through a recession that really wiped out the housing market and demand for housing for a good half decade. But somewhere around 2013 or 2014, the university resumed its growth trajectory, and the housing demand began to build.
At this point, with the vacancy rate, Measure R is acting as a lid of a pressure cooker, allowing the pressure to slowly but steadily build over time.
My question for the last six months to a year has been what does the release valve look like? Is building student housing sufficient to relieve that pressure or will the pressure continue to build even after sufficient student housing is built?
One thing that is clear is that I see for the first time in a decade real discussion about the need for housing. We have seen this week the first chirps questioning Measure R. The students are organizing. They have numbers – 23,000 or so live within the city limits of Davis. How many would it take to come out and vote in order to impact the election outcomes? And how many would it take to organize in 2020 to bring down Measure R?
Think that is long shot? Perhaps. But keep building the housing market pressure and somewhere, somehow, that pressure is going to blow.
—David M. Greenwald reporting