Monday Morning Thoughts: It Comes Down to This – Put the Housing Somewhere Else

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Orchard Park photographed on August 12, 2023.

By David M. Greenwald
Executive Editor

Davis, CA – As they say, people in glass houses are probably not the ones to be throwing stones.  While I agree that UC Davis should be building more housing, the residents of the city of Davis at least share some of the blame for the student housing crisis.

One commenter noted yesterday, “UC Berkeley is trying to provide at least 50% student housing and 25% graduate student housing.”

But as we know, Berkeley is facing a lot of the same problems that Davis is facing.  Berkeley of course has been thwarted in attempting to build student housing by CEQA suits.

The commenter however charges, “In contrast, UCD isn’t even trying to provide at least 50% student housing like all the other UCs.  Yet, UCD has 5,300 acres and a 900-acre core campus, the largest UC in the system. UCD’s continued under-performance compared to the other UCs is simply inexcusable.”

UC Davis of course can go further, but one has to wonder where things might be had UC Davis been able to simply build West Village out rather than deal with the absurd lawsuits that delayed construction by years and also made it much more difficult to build faculty and staff housing, because they had no Russell Blvd. access.

That citizen action not only delayed critical housing construction for years, but also helped to permanently poison city-university relations.

More recently, the student housing crisis has not been helped by the 2016 defeat of Nishi at the polls and the subsequent difficulties of having a university-only accessed project that has delayed construction now for almost five years.

On top of that, neighbors forced critical compromise that took housing off the table for University Commons, and those were two student housing projects literally next to campus.  Neither has been built.

It’s easy to say that the university can and should do more—but the citizens of Davis are actually part of the problem overall here.

The Sacramento Bee reported this weekend among other sales in Davis… six sales in Davis over the last week.  The cost is a problem, but the fact that only six sales occurred which prorates to less than 30 sales per month is probably even more so.

Four of the six sales were condos.  The two most expensive were $586 and $609 per square foot.  The $609 one was sold for just under $600,000 which puts it below average and median.  But it was just 970 square feet.

Meanwhile, a 1469-square-foot condo sold for $855K and two homes that were just under 2000 square feet sold for $940K and $1 million.

A survey of some of articles and social media across the state demonstrates the housing problem extends well beyond the city of Davis.

Orange County Register notes: “Goodbye starter home: First-time buyers struggle with Southern California prices, lack of inventory.”

Key point: “For generations, the leap from renter to homeowner begins with a starter home — a small two- or three-bedroom house, a townhome or a condo. Then, as families build equity, advance in their careers and have kids, they move up to the bigger house in the suburbs, often with better schools.

“But after a decade of bidding wars and relentlessly rising home prices, that entry-level ticket to the American dream is looking more like a Tiffany-wrapped jewel, out of reach for all but well-paid professionals or young adults getting down-payment help from their families.

“The median price for starter homes has doubled and even tripled in Southern California and the Bay Area since 2012, according to a recent study by the brokerage Redfin. The minimum annual income needed to afford an entry-level home was as high as $160,000 to $245,000 a year.”

The kicker: “Even in the Inland Empire — Southern California’s most affordable housing market — buyers need a six-figure income to afford a starter home.”

Think about that one.

This is basically a supply problem.

On Friday, Jordan Crimes tweeted, “I’m spending my Friday night in the affluent Bay Area suburb of Millbrae, where the county is presenting a plan to turn a hotel into ~100 homes for unhoused residents. It appears that the entire city is here, and they are *pissed*.”

Grimes notes, “Some background on Millbrae: it’s home to SFO, and has, like many cities in San Mateo County, a very high median household income ($141k/year, specifically). Also like many other cities in San Mateo County, they’ve built very little housing in the last decade.”

It all comes back to resistance.  Put the housing somewhere other than here.  I think we have a word for that.  It begins with an “n” and some people find it pejorative.  I find it descriptive.

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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28 thoughts on “Monday Morning Thoughts: It Comes Down to This – Put the Housing Somewhere Else”

  1. Matt Williams

    David, where are the articles about the City’s dismal (and getting worse very day) fiscal situation?  Are you afraid to illuminate the truth about how bad that situation is?  Where is your discussion of how the negative net financial contribution of housing to that dismal fiscal situation is huge?

    Housing is the primary reason we are in the massive fiscal “hole” that we are in … and adding additional housing is only going to dig that hole deeper.

    Shouldn’t we be fixing our current financial problems before we make them even worse?

    You state “The minimum annual income needed to afford an entry-level home was as high as $160,000 to $245,000 a year.” but then spend exactly zero amount of time discussing what that statement means for Davis.  How does the current Davis job market align with that statement?  What is Davis doing to add those kind of “home ownership jobs” to its local economy?  What is UCD doing to add those kinds of jobs to its workforce?  

    1. Tim Keller

      David:  “This is basically a supply problem.”

      This is true

      Matt:  “Where is your discussion of how the negative net financial contribution of housing to that dismal fiscal situation is huge?”

      This is ALSO true

      And that is really the challenge.   We are presented with a housing crisis that requires a city to LOSE money (long term) to fix.   Thats a big ask.

      This is why I think we have a VERY narrow path to walk with a “good” solution to housing.   Simple solutions like “just build more housing” arent going to cut it because HOW we build makes a huge difference.

      I laid out one solution that ticks all the boxes for housing.. it is a narrow path, and it means looking at development very differently than the status quo:  Transit-connected, medium density housing.

      Are there any better ideas to be had?  If not, if we have ONE workable pathway… perhaps its time to start developing the details around that pathway and start getting it done?

    2. Ron Glick

      Matt, in all the years of the Vanguard I never thought of you as a guy that would demonstrate such chutzpah. First you oppose the largest business development park in the history of Davis and then you complain about the structural deficit of the city as a reason to disregard the abysmally low vacancy rate as well as the inability of Davis to meet its Affordable Housing responsibilities.

      I’ve seen this argument about housing not generating enough revenue for the city but I always wonder how is it that long time residents, whose Prop 13 tax bases are much lower than the rates paid by new construction, is a better solution to the imbalances of the city. Not only that but many long time residents get senior exemptions from many of parcel taxes that new residents are unlikely to pay. Even more, many longer tenured residents don’t pay the high Mello-Roos assessments that new residents pay. So I would argue that older residents are more of a problem for the structural deficit than new residents would be.

      1. Walter Shwe

        So I would argue that older residents are more of a problem for the structural deficit than new residents would be.

        Thank you Ron Glick. I came to a similar conclusion, but lacked the factual basis to prove it. Matt not only dumps the City’s fiscal problems on new residents, but UCD as well.

        1. Matt Williams

          Walter, I have neither the authority nor the power to dump anything on anyone.  That is your imagination running away with itself.

          However, you are correct when you and Ron say that newer residents shoulder more of a fiscal burden.  That reality is a direct result of the provisions of Proposition 13.  It’s the law that mandates that disproportional burden between new residents and old residents.

        2. Ron Oertel

          One positive impact of Proposition 13 is that it ensures that existing residents don’t pay the cost for accommodating new residents.

          It also keeps people from being priced out of their own homes, in a manner similar to rent control.

      2. Matt Williams

        Ron, let’s start with your last sentence.  While it may be correct in fact, Winston Churchill addressed a similar situation when he described the following interaction … “She: What kind of woman do you think I am?  He: We’ve already established that. Now we’re just haggling over the price.”

        The Davis version of that is as follows … Question: “What kind of money loser do you think I am?”  Answer: “We’ve already established that. Now we’re just haggling over the magnitude of the loss amount.”

        Prop 13 is indeed a huge problem, but it does’t affect me directly since I am a renter, not a home owner.  But regardless it is the law of the land.

  2. Matt Williams

    I also disagree with those—strongly—who argue that new housing should be exclusively on the UC Davis campus and that the city of Davis has no obligation to student housing

    .
    In the above statement in yesterday’s article, what you are asking the City of Davis to take on is an “unfunded mandate.”  UCD is executing a business plan.  In order to capture and perpetuate its revenue streams, housing its students is a cost of doing business … a cost in activities and resources and dollars.  UCD completes some of those activities themselves, but they also outsource a substantial portion of those activities to private contractors (especially in West Village) and to the City and community.  They pay the private contractors for completing those activities but expect the City and the community to complete those activities free of charge.  
     
    Why the double standard?
     
    That question becomes all the more meaningful and relevant when you look at both UC Santa Cruz and UC Berkeley, where the respective universities pay their respective host City millions of dollars each year to “fund” the activities that they “outsource” to them.
     
    Why does UCD expect a free ride?

    Why do you believe UCD should get a free ride, especially in the context of UC Santa Cruz and UC Berkeley?

    Sent from AT&T Yahoo Mail for iPad

    1. Richard McCann

      Somehow other cities are building more housing and remaining fiscally solvent. Davis’ problem is that we’ve constrained and discouraged retail that would generate sales tax revenues that go with associated population growth. In addition, more businesses that employee local residents also generate more fiscal revenues. In addition, the house value premium created by the presence of UCD creates more property tax revenues, although at Ron G points out, the Prop 13 aspects diminish that premium.

      Tim’s proposal creates new neighborhoods that should be more fiscally sound–mono-zoning of single family homes is at the heart of the fiscal problem.

      The City also can create either enhanced infrastructure financing districts (EIFD) or climate resilience districts (CRD) to fund some aspects of municipal operations including capital investment. That allows a local jurisdiction to capture incremental property tax revenues that otherwise would have gone to the state. The Legislature should consider creating a new version of these districts for new housing developments in general. This could replace what was lost when redevelopment districts were rescinded because they were being abused by cities.

      It’s incumbent on the City to go out and create new jobs for local residents. UCD should be cooperative, but it’s not its responsibility. UCD is already pouring nearly $1 billion into the local economy. It’s our job to do something with it.

      BTW, UCD much more so than UCB provides many municipal services at its own cost. It’s not “outsourcing” to the same degree. Perhaps UCD can provide more revenue sharing, but the City of Davis probably needs to take the first step in proposing an amount based on a rigorous study.

      1. Matt Williams

        Somehow other cities are building more housing and remaining fiscally solvent. Davis’ problem is that we’ve constrained and discouraged retail that would generate sales tax revenues that go with associated population growth.

        .

        Richard, if Strong Towns is correct in its analysis, the other cities aren’t actually fiscally solvent.  They are just better at hiding their insolvency … or postponing it because they are still perpetuating their Ponzi Scheme.

        In addition, more businesses that employee local residents also generate more fiscal revenues

        .

        there is an old saying that “If wishes were horses, then beggars would ride.”  There is also a relevant song from my youth by Petula Clark entitled “Wishing and Hoping”  Davis’ leadership has shown absolutely no ability or inclination to add any such businesses.  By way of example, how many jobs did DiSC put on the table that would have addressed David’s statement “The minimum annual income needed to afford an entry-level home was as high as $160,000 to $245,000 a year.”

        It’s incumbent on the City to go out and create new jobs for local residents. 

        .
        On that you and I agree 100%.  A good place to start in that “incumbency” is to create an Economic Development Plan built to accomplish a Community Vision.

    2. Walter Shwe

      That question becomes all the more meaningful and relevant when you look at both UC Santa Cruz and UC Berkeley, where the respective universities pay their respective host City millions of dollars each year to “fund” the activities that they “outsource” to them.

      Why does UCD expect a free ride?
      Why do you believe UCD should get a free ride, especially in the context of UC Santa Cruz and UC Berkeley?

      I would want to know what the other UC campuses pay their respective host cities besides just Santa Cruz and Berkeley. What activities does UCD outsource to the City and how much does it cost the City? UCD should not subsidize Davis, just reimburse for services rendered.

  3. Ron Oertel

    This is basically a supply problem.

    There’s actually no “problem” in the first place.
    But what we’re seeing (nationwide) is a drop-off in both supply AND demand, due to rising interest rates.  The predicted housing crash hasn’t really materialized so far, but it’s certainly “correcting” in some markets (like San Francisco).

    All of this is the result of government stimulus after the 2008 housing crash, and the actions they took during the pandemic – which they’re now trying to “correct” via rising interest rates.

    In the meantime, David claims that there aren’t any reasonable “starter” homes in Davis (whatever that means).  In any case, I found 3 of them, via a simple Zillow search:

    $690K:  https://www.zillow.com/homedetails/2001-Humboldt-Ave-Davis-CA-95616/16525034_zpid

    $775K:  https://www.zillow.com/homedetails/540-W-8th-St-Davis-CA-95616/16521065_zpid/?

    (The one above looks pretty sweet, and has an ENORMOUS lot.  More than enough room to add an ADU.)

    $799K:  https://www.zillow.com/homedetails/2846-Loyola-Dr-Davis-CA-95618/16518966_zpid/

    (Price was recently cut by $18K.)

    Not to mention the 96-unit Chiles Ranch development which has been “coming soon” for over a decade.

    And the 30-unit Pole Line Road development (owned by the same developer) in which there hasn’t been any visible construction activity since it was purchased by the same developer.

    Should we discuss (again) all of the new housing available in Woodland, as well?

    But there’s also a basic assumption in David’s argument that I fundamentally (to its core) do not agree with.  That assumption consists of a belief that housing prices should dictate policy.

    This is also the reason I don’t support Tiburon, for example, building massive amounts of housing.  Even though I don’t have a “glass house” (as David might put it) anywhere near there.

     

    1. David Greenwald Post author

      “Not to mention the 96-unit Chiles Ranch development which has been “coming soon” for over a decade.”

      What does that have to do with anything?

      1. Ron Oertel

        Why do you ask me silly questions, causing me to “use up” one of my five comments if I respond?

        You’re the one who started talking about housing availability (specifically in Davis) in your article.

        But there’s actually two parts to my comment:

        1)  96 brand-new units are “eventually” coming to Chiles Ranch, and another 30 on Pole Line.  I believe that all of these are single-family units.

        2)  Why the more than decade-long delay, if “demand” is so high?  Keep in mind that interest rates for the developer were a lot LOWER not too long ago.  Which makes one wonder why this wasn’t built a long time ago.

        But I also want to clarify the following statement I made:

        This is also the reason I don’t support Tiburon, for example, building massive amounts of housing.  Even though I don’t have a “glass house” (as David might put it) anywhere near there.

        I’m specifically referring to the ultimate/total AMOUNT of housing, in regard to my comment above.

         

        1. David Greenwald Post author

          You should probably ask Dan Fouts why they haven’t been able to build the housing. In the time that they’ve taken, Cannery got approved, built and sold – more than five times more housing. I don’t suspect it has anything to do with demand. Obviously much larger developments are being proposed in Davis. Not a very good example especially without delving into the specific circumstances of that project.

      2. Richard McCann

        Ron O

        Housing supply and demand is not a simplistic mass balance equation driven by overall population growth. It’s a complex process driven by many factors, and the single best indicator of the relative balance is price. And right now housing prices in Davis are 50% higher than neighboring Yolo and Solano County cities. That indicates that the demand is high and the supply is not being allowed to respond. There simply is no other possible interpretation. Coming up with anecdotes does not refute the data.

        1. Ron Oertel

          Housing supply and demand is not a simplistic mass balance equation driven by overall population growth. It’s a complex process driven by many factors, and the single best indicator of the relative balance is price.

          And yet, you put forth figure which doesn’t even account for differences within cities – including Davis.  Let alone between different cities.

          That indicates that the demand is high and the supply is not being allowed to respond.

          The difference (and it’s not 50%) existed before Measure J went into effect.  There’s articles on the Vanguard itself which show this.

          Prices in nearby cities (and in the region as a whole) are high compared to other cities – even within California.  Does this mean that supply is being “constricted” compared to “demand” in those nearby cities as well?

          (That’s your basic argument – that housing prices would be the same everywhere, if “supply” was sufficiently expanded.) 

          But again, my personal opinion is that housing prices should not dictate growth policies in the first place.

          The price differential will, however, ensure that newcomers to the area will seek out places like Spring Lake.  What exactly is the “problem” with that? 

          You’ve noted that UCD itself is not even expanding the amount of staff it employs in the first place.  

           

  4. Ron Oertel

    This is basically a supply problem.

    True – if you think that a policy of continuously-encouraging non-residents to move to a given locale has any valid purpose or goal.

    A continuous, never-ending expansion of a city onto farmland and open space.  Even better, since every city in the region has this same apparent goal.

    Strangely-enough, some of the most sprawling places (like San Jose and Los Angeles) are also among the most-expensive.

      1. Ron Oertel

        Look-around – I don’t think so.

        That is, in fact, the policy of the entire region (and beyond).

        No purpose, no goal – other than continued growth.

        That’s also the reason that you and the other growth activists can never define the purpose, goal, or any measurement of “success” thereof.

        While simultaneously pursuing fiscal bankruptcy as a result of what you advocate.

         

         

         

         

        1. David Greenwald Post author

          Point one: look around… you have to go back nearly 30 years before you find the previous building on farmland prior to Bretton Woods.

          Point two: “no purpose, no goal – other than continued growth” – growth is outcome not a goal. The city of Davis has basically stopped growth for 25 years. 0.25 percent growth per year. The idea that there is no purpose and no goal other than growth is not only inaccurate, it’s dishonest.

        2. Ron Oertel

          Point one: look around… you have to go back nearly 30 years before you find the previous building on farmland prior to Bretton Woods.

          Can your eyes see anything that’s happening beyond Davis?

          Point two: “no purpose, no goal – other than continued growth” – growth is outcome not a goal.

          And yet, you haven’t stated what the purpose or goal is, or how to measure it.  In fact, the only thing you cite is “how much” Davis has, or hasn’t grown.

          As a side note, I’d normally look at something like The Cannery as very much “like” sprawl.

          It seems that you’re referring to growth rates as a “goal”, itself.  I’m not sure if you’re correct regarding those statistics, but focusing on that indicates where your “goal” actually is.

          Again, let me ask – do you think there’s been a “shortage” of sprawl in the region?

          If you say “no”, then why haven’t the “problems” been solved (e.g., regionally or statewide)?

          And do you think (for example) that if Davis grows somewhat more slowly than the rest of the region, then Davis is “behind”?  (Again, you seem to be advocating a growth rate, rather than stating what you think the “problem” is.)

          And do you think that folks who want to move to the region (even if they work at UCD) limit their search to Davis?

          Do you suppose that they compare housing prices in surrounding cities that pursue sprawl, as well as those in Davis?

          This might be my fifth comment, already.

           

      2. Richard McCann

        Note that the calls for building more housing on the UCD campus is generally a call to pave over farmland and open space. UCD’s research land is far more valuable than any of the ag land around the city. If we’re really concerned about the impacts on ag we should be asking to put housing in town, not on campus.

        1. Matt Williams

          Richard, it only calls for more land use if the decision is to build out rather than build up.  UCD already has a 10 story building on campus, so the precedent for building up has already been settled, but UCD chooses to ignore its own precedent and not build its new housing up.

  5. Eileen Samitz

    David,

    You keep on ignoring and distorting the simple message that UCD can, and needs to build higher density student housing on campus like the other UCs.  If other UCs can do it, UCD can do it. There is no excuse why UCD can’t, and they need to start with Solano Park, and continue building higher densities with any future student housing they build.

    You make it sound like West Village is built out, but it has significant undeveloped acreage still sitting dormant. If UCD is not going to build faculty and staff housing there, then they need to build much higher density student housing there, as well as at Solano Park.

    You continue to be an apologist for UCD, always running interference for them. You have no trouble advocating for higher density housing in the City, so you need to do the same for UCD. Otherwise, you are using double standards.

  6. Ron Oertel

    You state “The minimum annual income needed to afford an entry-level home was as high as $160,000 to $245,000 a year.” but then spend exactly zero amount of time discussing what that statement means for Davis.  How does the current Davis job market align with that statement?  What is Davis doing to add those kind of “home ownership jobs” to its local economy?  What is UCD doing to add those kinds of jobs to its workforce?

    None of which is accurate or even remotely a factor, when folks arrive from other areas with boatloads of cash.  Or for those already-established and move “within” a city or area.

    If more high-paying jobs are added, it will add more competition with the housing market – driving prices up higher.

    Income is irrelevant in regard to much of the broader housing market, these days.  Lots of all-cash transactions, as well.

    As the boomers die-off, their wealth will be transferred to their millennial children.

     

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