California Governor Gavin Newsom has recently signed dozens of new housing bills in an attempt to address the state’s housing crisis. However, critics argue that these new laws are simply a continuation of failed policies that rely on state intervention and taxpayer subsidies. Newsom’s $2.2 billion Homekey+ initiative, which aims to provide permanent supportive housing for the homeless, has been criticized for its focus on converting existing buildings into permanently subsidized housing, with some projects sitting empty and unfinished.
The new legislation also emphasizes affordable housing over market-rate housing, with measures such as inclusionary zoning that have been found to decrease new housing construction. Research has shown that when the supply of market-rate housing increases, rents decrease across the board. In order to truly address the housing crisis, experts argue that California should focus on liberalizing the housing market to encourage more private development of market-rate housing without affordability mandates.
While there are some positive reforms in the new legislation, such as CEQA exemptions and zoning liberalization, the continued emphasis on affordable housing requirements may hinder their effectiveness. Critics argue that California’s policymakers need to prioritize deregulation and make it easier to build housing for all income levels in order to truly address the state’s housing crisis. Without significant changes to current policies, California may face continued housing challenges and potential population flight similar to Detroit.
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