California State law requires cities to plan for and provide affordable housing for low-income households, but cities are not required to build mid-priced housing. That trend is changing. As we all know, in SoCal you’ve got to be in a pretty plush position to buy into the housing market. In April, in the Golden State the minimum household income needed to purchase a median-priced home was in the $147,000 range. The average home price was $509,230.

According to the Santa Monica Community Voices Profile, The median household income around town is $50,714 with 12 percent making $150,000 or more and 16 percent making less than $15,000. Sixty-five percent of the city’s residents are renters, while 28 percent are homeowners. Meaning, if you live in Santa Monica, and don’t already own property here, it’s probably not going to happen anytime soon.

State and local governments are offering incentives to builders who incorporate “Workforce Housing” - price-reduced homes for middle-income earners into new and redevelopment projects. Perks to deliver Workforce Housing along with traditional market units include fee waivers, reduced parking requirements, modified zoning, expedited permitting, tax credits and funding options, inclusionary zoning provisions (requiring developers to set aside a predetermined percentage of units for affordable housing) and density bonus programs.

The concept is not new. Universities, for example, have long offered more affordable to recruit and retain staff and professors. Now the trend is Workforce housing is targeted at building homes for households earning 80% to 120% of an area's median income.

The city of Santa Monica's inclusionary housing program requires that 30% of multifamily residential developments be affordable to and occupied by low- and moderate-income households.

The Community Corp. of Santa Monica is our nationally praised champion of low income housing. At last count, Community Corp oversees more than 2,400 low-income units on 78 properties throughout Santa Monica.

As of late, Community Corp has been grappling with home affordability issues by proposing to sell two and three-bedroom condos for less than half of their current market value.

“We are not shifting our major focus, commitment away from very low-income rental housing,” notes Joan Ling, executive director of the Community Corp. “It’s just that we want to try something different, because we know the teachers and the classified workers in the district, are priced out of being here.”

Local Workforce Housing  buyers would have to fall into the “moderate income” category - $45,000 to $60,000 a year, per household. It’s not yet clear how pricing would be set for owners of the condos who later chose to sell.

It is estimated that close to $100,000 in subsidies from the federal, state and local government will be needed for each Workforce Housing condo in order for CCSM to sell them below market rates. Obviously those details still need to be worked out before this program goes forward.

Los Angeles currently offers a 35% density bonus to developers who build within 1,500 feet of a major transit hub, university campus or economic activity center. A 100-unit condominium building with a 35% density bonus could include 35 Workforce Housing units.

One Workforce Housing project is going up in the Lincoln Heights neighborhood is working on the Avenue 26 Condominiums, the four-phase multi-use development will feature workforce condominiums, a senior center, a child-care center and a retail site. The project is adjacent to the Avenue 26 Metro Gold Line station.

Normal market value for the 165 will be from $210,000 to $375,000. Fifteen percent will be Workforce Housing units offered to buyers earning 80% to 200% of the area's median.

Although our local housing prices are high, we are in no way unique. The most expensive markets for middle income workers to buy or rent a home were in the San Francisco Bay Area cites of San Francisco, Oakland and San Jose.  And, throughout the country, our elementary school teachers, police officers, licensed practical nurses, retail salespeople or janitors don't qualify to purchase the median priced home, based on the median income, according to the National Housing Conference's (NHC) "Paycheck to Paycheck: Wages and the Cost of Housing in America."  The study notes that nationwide the median annual salaries for each of these occupations fell short of the nearly $50,000 necessary to qualify for the median priced home of $156,000.  Just imagine their issues if they live in California.

Solutions are in the works. Recently Bank of America teamed up with the largest mortgage investor, Fannie Mae, for a targeted-financing concept they call "neighborhood champions" mortgages. Income standards will be more generous than under traditional mortgage lending. The new program recognizes that many community professionals supplement their regular incomes with sideline jobs: Police officers may also work as private security guards, or teachers may earn cash tutoring or working during vacation periods, for example. Applicants will have to state how much sideline income they earn, and where they earn it but won't have to document it.  The "champions" program will attempt to remove as many barriers as possible to home buying.

“Homeownership continues to be one of the most solid and durable investments a California family can make. And our recent revisions give even more strength and versatility to our homeownership programs,” declares California Housing Finance Agency Executive Director, Theresa A. Parker.

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Where to find workforce housing

For more information about the availability of for-sale workforce housing or to sign up to be on an interest list and receive online updates, contact these Southland developments.

In Los Angeles County:

• Avenue 26 Condominiums in Lincoln Heights: http://www.ave26.com , (323) 262-6636.

• Fuller Lofts in Lincoln Heights: http://www.livableplaces.org/development/lincolnheights.html,
(213) 622-5980.

• Irvine Byrne Building Lofts in downtown Los Angeles: http://www.urbanpacific.com , or e-mail info@urbanpacific.com.

• Marlton Square in the Crenshaw district in South Los Angeles: http://www.leehomes.net /home/contacts/contacts.html, (310) 827-0171.

• Olive Court in Long Beach: http://www.olivecourt.com, (866) 654-3300.