bae urban economics
Tri-City Subregion Residential Displacement Study Report Prepared for the City of Fremont
September 17, 2021
Table of Contents
EXECUTIVE SUMMARY ................................................................................................................ i INTRODUCTION .......................................................................................................................... 1 DEMOGRAPHIC AND HOUSING TRENDS OVERVIEW ................................................................. 3 Demographic Snapshot ............................................................................................................... 3 Alameda County Income Limits ................................................................................................... 5 Income Level by Race and Ethnicity ........................................................................................... 6 Housing Stock............................................................................................................................... 7 DISPLACEMENT ANALYSIS ........................................................................................................ 8 Multifamily Rent Trends ............................................................................................................... 9 Affordability of Multifamily Rental Market ............................................................................... 10 Multifamily Rental Vacancy Rate ............................................................................................. 11 Home Sale Price Trends ........................................................................................................... 12 Affordability of For-Sale Housing Market ................................................................................. 14 Housing Cost Burden ................................................................................................................ 15 Cost Burden by Race and Ethnicity .......................................................................................... 19 Overcrowding ............................................................................................................................. 20 Renter Households in Single Family Units ............................................................................... 21 Housing Choice Voucher Usage ............................................................................................... 22 Change in Lower-Income Households ..................................................................................... 24 Change in Lower-Income Renter Households by Race and Ethnicity .................................... 27 School District Enrollment Trends ............................................................................................ 28 Special Needs Populations and Households........................................................................... 29 Displacement Risk for Special Needs Households ................................................................. 30 Commute Trends ....................................................................................................................... 32 Service Provider Survey Responses ......................................................................................... 33 SUMMARY OF FINDINGS ......................................................................................................... 34
List of Tables
Table 1: Households by HUD Area Median Family Income (HAMFI) Level, 2010-2017 ............ 25 Table 2: Renter Households by HUD Area Median Family Income (HAMFI) Level, 2010-2017 26
List of Figures
Figure 1: Tri-City Subregion and Alameda County Demographic Snapshot .................................. 4 Figure 2: 2020 Income Limits, Alameda County ............................................................................ 5 Figure 3: Household Income Level by Race and Ethnicity, Tri-City Subregion .............................. 6 Figure 4: Housing Units by Type, 2020 ........................................................................................... 7 Figure 5: Average Multifamily Asking Rents, Q1 2010-Q1 2021 .................................................. 9 Figure 6: Affordability of Market-Rate Rental Housing in Tri-City Subregion .............................. 10 Figure 7: Multifamily Rental Vacancy Rate, Q1 2010-Q3 2020 .................................................. 11 Figure 8: Median Single-Family Home Sale Prices, 2012-2020 ................................................. 12 Figure 9: Growth in Median Condominium and Townhome Sale Prices, 2011-2020 ............... 13 Figure 10: Minimum Qualifying Income Required to Purchase Median Sales Priced Home in 2020 ................................................................................................................................................ 14 Figure 11: Housing Cost Burdened Lower Income Households in the Tri-City Subregion, 2013- 2017 ................................................................................................................................................ 16 Figure 12: Cost-Burdened Lower Income Renter Households, Tri-City Subregion and Alameda County, 2013-2017 ........................................................................................................................ 17 Figure 13: Growth in Cost-Burdened Lower Income Renter Households, Tri-City Subregion, 2010-2017...................................................................................................................................... 18 Figure 14: Racial and Ethnic Composition of Rent Burdened Households, Tri-City Subregion, 2013-2017...................................................................................................................................... 19 Figure 15: Renter Household Overcrowding, 2015-2019 ........................................................... 20 Figure 16: Renter Households in Single Family Units, 2015-2019 ............................................ 21 Figure 17: Housing Authority of the County of Alameda (HACA) Housing Choice Vouchers, March 2010-March 2020 .............................................................................................................. 23 Figure 18: Change in Lower-Income Renter Households by Race and Ethnicity, 2010-2017 .. 27 Figure 19: Student Enrollment, 2014-15 through 2019-20........................................................ 28 Figure 20: Special Needs Populations and Households, Tri-City Subregion ............................... 29 Figure 21: Income Distribution by Household Type, Tri-City Subregion, 2013-2017 ................. 30 Figure 22: Housing Cost Burden Among Lower-Income Renters Households, Tri-City Subregion, 2013-2017...................................................................................................................................... 31 Figure 23: Change in Tri-City Workers by Place of Residence, 2010-2018 ................................ 32
i
EXECUTIVE SUMMARY
This study finds that lower-income1 Tri-City Subregion (i.e., Fremont, Newark, and Union City), residents have been experiencing residential displacement and are at risk of additional displacement pressure, to a greater extent than lower-income residents in Alameda County overall. The report demonstrates that residential displacement has occurred and is at high risk of continuing to occur without additional affordable units being prioritized for lower-income Tri-City Subregion workers and residents.
KEY FINDINGS
Eighty-two percent of lower-income renters in the Tri-City Subregion have a high housing cost burden, while 22 percent of Tri-City renters are living in overcrowded conditions.
These are higher proportions than in Alameda County overall, where 77 percent of lower- income renters have a high housing cost burden and 13 percent of renter households are living in overcrowded conditions. High housing cost burden and overcrowding are indicators that households are struggling to afford housing and could be at risk of displacement
Market-rate multifamily rents increased by 55 percent in the Tri-City Subregion between 2010 and 2020, faster than the countywide increase of 44 percent. At the end of the first quarter of 2020 (i.e., before the start of the COVID-19 pandemic), the average monthly rent per unit was $2,445 in the Tri-City Subregion, five percent higher than the average countywide ($2,337). Affordable rents for households with incomes equal to 60 percent of the area median income, the highest income level served by units funded through Measure A1 funds, are considerably lower than the average market-rate rent in the Tri-City
1 Throughout this report, lower income households are defined as those earning 80 percent of AMI or less.
The overwhelming majority of Tri-City residents that would be eligible for units funded through Alameda County Measure A1 affordable housing funds are likely at risk of displacement due to high housing costs.
Market-rate rents in the Tri-City Subregion have increased substantially in recent years and are considerably higher than lower-income households can afford, increasing displacement risk for lower-income households.
ii
Subregion. For the average three-person renter household earning 60 percent of AMI, the difference between the maximum affordable monthly rent and the current market-rate monthly rent for a two-bedroom unit in the Tri-City Subregion is more than $850. Based on current average market rents, a four-person household earning 60 percent of AMI would only be able to afford a market-rate studio unit in the Tri-City Subregion.
People that work in the Tri-City Subregion are increasingly commuting to work from more affordable cities such as Hayward, Stockton, Oakland, and San Jose. San Joaquin County and Stanislaus County have experienced large percentage increases in the number of residents that commute to jobs in the Tri-City Subregion. Between 2010 and 2018, the number of Tri-City commuters increased by 78 percent in San Joaquin County and 65 percent in Stanislaus County, significantly greater increases than the overall increase in people working in the Tri-City Subregion (41 percent). Meanwhile, the share of Tri-City workers that live in in the Tri-City Subregion decreased, likely due to the widespread shortage of affordable housing options in the Tri-City Subregion.
Percent of Households
with Extremely Low, Very
Low, or Low Incomes:
27% for all Tri-City households
47% for Households with One or
More Persons with a Disability
55% for Elderly Tri-City
Households
Percent of Lower-Income
Renter Households with
a High Housing Cost
Burden:
82% for all Tri-City
households
87% for Large Family
Households
Percent of Households
with Incomes Below
Poverty Level
2.8% for all Tri-City family
households
9.5% for Tri-City family
households with a single
female householder
An increasing share of the Tri-City Subregion’s workforce is commuting to work from other more affordable locations outside of the Tri-City Subregion, a sign that Tri-City workers are having a more difficult time finding housing in the Tri-City Subregion that they can afford.
Lower-income households and individuals in the Tri-City Subregion with special housing needs, including seniors, people with disabilities, single-parent households, and large families, are disproportionately at risk for displacement.
iii
These households are more likely than other households in the Tri-City Subregion to have low incomes, and are therefore are more likely to be eligible for affordable housing that is targeted to low-income households. Additionally, lower-income renter households in the Tri-City Subregion with special needs are more likely than other lower-income renters to have a high housing cost burden, indicating a greater need for affordable housing among these households.
As a whole, the Tri-City Subregion experienced a minimal increase (0.9 percent) in lower- income households between 2010 and 2017, while Alameda County overall experienced a larger increase (3.4 percent). The change in the Subregion’s lower-income households impacted various types of households differently, with an increase in extremely low-income households, little change in very low-income households, and a decrease in low-income households. Taken together with the other data presented in this study – such as recent increases in housing cost burden and housing cost increases – these data indicate that changes among the Subregion’s population in recent years have been due in part to lower- income households leaving the Subregion, a portion of which likely left due to displacement.
Between the 2014-15 and 2019-20 school years, student enrollment in the New Haven Unified School District declined by 11 percent, while enrollment in the Newark Unified School District declined by nine percent. An analysis performed in 2018 by the New Haven Unified School District stated that declines in student enrollment are likely related to the cost of housing. The Fremont Unified School District (FUSD) has experienced unexpected declines in student enrollment since the 2018-19 school year. According to a recent analysis of enrollment trends by FUSD, the declines in enrollment are likely associated with housing affordability and the high cost of housing in Fremont. Meanwhile, overall enrollment in public school districts elsewhere in Alameda County increased slightly Data suggest that many lower-income households in the Tri-City Subregion have likely already been displaced due to high housing costs.
All three school districts in the Tri-City Subregion have experienced declines in student enrollment in recent years, indicating that families with children have been moving out of the Tri-City area.
iv
between the 2014-15 and 2017-18 school years and remained relatively flat between the 2017-18 and 2019-20 school years.
Disproportionately Impacted by Displacement in the Tri-City Subregion:
Lower-income households People with disabilities
Racial and ethnic minority groups Seniors Single-parent households Families with children Large families with households
75% of the social service providers that responded to a survey related to this study indicated that their clients have moved out of the Tri-City Subregion, are at risk of displacement, or are planning to move out of the Tri-City Subregion due to economic hardship or other reasons beyond their control.
Local social service providers confirm that the Tri-City Subregion’s most vulnerable households face considerable displacement risk and that some households have already been displaced.
v
CONCLUSION
Renters in the Tri-City Subregion are at a greater risk of displacement than renters in Alameda County overall. Recent declines in some segments of the Subregion’s lower-income households, school district enrollment trends, and survey results from local social service providers suggest that Tri-City Subregion residents have likely already been displaced.
Lower-income renters in the Tri-City Subregion are more likely to have a high housing cost burden than lower-income renters countywide. Similarly, renter households in the Tri-City Subregion experience extremely high levels of overcrowding and are much more likely to live in overcrowded units than are renter households in Alameda County overall. Facing higher average market rents and lower vacancy rates, Tri-City lower-income renters are much more vulnerable to displacement than the average lower-income renter household in Alameda County.
The analysis concludes that the three cities in the Tri-City Subregion need policies and programs that specifically support housing affordability and stability for lower income households, especially those households with incomes at or below 60 percent of the Area Median Income. For many lower-income Tri-City Subregion residents, deed-restricted affordable rental housing, which is severely limited in supply, is the only housing option that could potentially provide affordability, stability, and protection from displacement.
Executive Summary graphics prepared by the City of Fremont
82%22%55%4.1%74%13%44%0.7%0%10%20%30%40%50%60%70%80%90%100%% of Lower-IncomeRenter Householdswith High HousingCost Burden% of RenterHouseholds Living inOvercrowded UnitsIncreases in Market-Rate Rents March 2010 –March 2021 Change in Lower-Income Households,2010-2017Executive Summary Key FindingsTri-City SubregionAlameda County
1 INTRODUCTION
Displacement can have a range of negative effects at the individual, household, community, and regional levels. Often, individuals and households that are displaced must move further from their places of work, established childcare arrangements, and social support networks, while children in displaced households may experience a disruption in schooling. Widespread displacement often exacerbates inequalities in access to opportunity and patterns of segregation as lower-income households are increasingly excluded from higher-cost areas. In cities where residents have been displaced, these trends can have a negative impact on the economic, racial, ethnic, and social diversity of the local population. In addition, local employers in high-cost areas often have difficulty recruiting and retaining workers for lower- paying jobs that are necessary to support local economic activity. These trends can also lead to workers commuting long distances to jobs in higher-cost communities, creating negative impacts in terms of equity, health, and the environment.
As a part of the City’s efforts to address displacement, the City of Fremont has instituted a local live/work policy for affordable housing developments in Fremont, which prioritizes affordable housing placements for individuals or households that live or work in Fremont.
There are three affordable projects in the City of Fremont development pipeline that received funding through Alameda County Measure A1 subregional funds. For cities to apply subregional live/work preferences to affordable housing projects using subregional A1 funds, Alameda County requires the jurisdiction to prepare a displacement study to evaluate displacement trends within the subregion. The displacement study must demonstrate that a) Tri-City Subregion residents are at greater risk of displacement than residents of Alameda County as a whole; b) current Tri-City residents are being displaced; and c) a local live/work preference would prevent further displacement. To respond to this requirement and in recognition of the negative impacts of displacement, the City of Fremont commissioned this study to evaluate the extent to which households in the Fremont/Newark/Union City subregion, herein referred to as the Tri-City Subregion, have experienced or are at risk of displacement. The Alameda County Measure A1 guidelines refer to the Tri-City area defined by Fremont, Newark, and Union City as “South County.”
This report provides data and analysis on various indicators that Tri-City residents have been displaced or are currently at high risk of displacement. The analysis focuses on displacement impacts and displacement risk among lower-income households, consistent with the income levels served by units funded through Measure A1 funds.
The remainder of this report is divided into three chapters. The following chapter provides a brief overview of demographic and housing conditions to provide baseline information for the displacement analysis. The next chapter provides data related to various indicators that Tri- City residents have been displaced and indicators that existing Tri-City residents are currently at risk of displacement. This analysis focuses particularly on displacement impacts and
2 displacement risk among lower-income households, consistent with the income levels served by units funded through Measure A1 funds. The final chapter summarizes the findings from the analysis.
3 DEMOGRAPHIC AND HOUSING TRENDS
OVERVIEW
This chapter provides a high-level overview of demographic and housing conditions in the Tri- City Subregion and Alameda County to provide background for the displacement analysis provided in this report. The data in this section generally do not directly address whether Tri- City residents have been experiencing displacement or are at risk of displacement but are instead included to facilitate an understanding of the Tri-City Subregion’s unique position in Alameda County and inform the displacement analysis provided in the following chapter of this report.
DEMOGRAPHIC SNAPSHOT
The Tri-City Subregion is demographically distinct from Alameda County as a whole, with larger household sizes, higher overall household incomes, and a different distribution of the population among various racial and ethnic groups. As of 2020, the Tri-City Subregion had a population of approximately 352,400 residents and a total of 111,900 households, accounting for approximately 22 percent of the population in Alameda County and 19 percent of Alameda County’s households, according to data from Esri. The average household size in the Tri-City Subregion is 3.13, much higher than the average countywide (2.73). A much higher share of households in the Tri-City Subregion are also families (79 percent) than in the County overall (65 percent). The Tri-City Subregion is home to a large population of individuals of Asian descent, which comprise approximately 54 percent of Tri-City residents, compared to 32 percent of residents countywide. The Subregion has a much lower share of White residents (19 percent in the Subregion compared to 30 percent in the County), Hispanic/Latino residents (18 percent in the Subregion compared to 22 percent in the County) and Black/African American residents (3 percent in the Subregion compared to 10 percent in the County).
The Tri-City Subregion also has a large concentration of above moderate-income households, which comprise 55 percent of all households in the Tri-City Subregion compared to 44 percent of households countywide, with a correspondingly small concentration of lower-income households (27 percent in the Tri-City Subregion, compared to 38 percent in Alameda County).
Units funded through Measure A1 funds would serve households with extremely low, very low, and low incomes, and therefore would not be available to households with moderate or above- moderate incomes.
4 Figure 1: Tri-City Subregion and Alameda County Demographic Snapshot Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; Esri Business Analyst, 2020; BAE, 2021.
3.132.732.50 2.60 2.70 2.80 2.90 3.00 3.10 3.20Tri-City SubregionAlameda CountyAverage Household Size
17.8%22.4%2.8%9.8%19.4%30.2%54.4%31.8%5.5%5.8%0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Tri-City SubregionAlameda CountyRace and EthnicityHispanic/LatinoBlack/African AmericanWhiteAsianAll Other21.5%23.6%24.3%21.6%27.1%28.3%12.5%12.5%14.6%14.0%0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Alameda CountyTri-City SubregionAge DistributionUnder 1818-3435-5455-6465 or older8.8%15.5%8.0%11.2%10.0%11.6%18.6%17.2%54.6%44.4%0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Tri-City SubregionAlameda CountyHousehold Income DistributionExtremely Low IncomeVery Low IncomeLow IncomeModerate IncomeAbove Moderate Income
5 ALAMEDA COUNTY INCOME LIMITS
For the purpose of designing affordable housing programs and analyzing housing issues, households are often categorized as extremely low-income, very low-income, low-income, or moderate-income based on household size and how household income compares to the Area Median Income (AMI) for other households of the same size. Income limits for each household size and income group are established annually by State and Federal agencies.
In 2020, the median household income in Alameda County was $119,200 for a four-person household, $107,300 for a three-person household, $95,350 for a two-person household, and $83,450 for a one-person household. Lower income households are generally defined as those earning 80 percent of AMI or less. Figure 2 shows the maximum household income for extremely low-, very low-, low-, and moderate-income households of various sizes in Alameda County as of 2020, according to the income limits set by the California Department of Housing and Community Development.
Figure 2: 2020 Income Limits, Alameda County
Sources: California Department of Housing and Community Development (HCD); City of Fremont Housing Division; BAE, 2021.
6 INCOME LEVEL BY RACE AND ETHNICITY
Income levels for households in the Tri-City Subregion vary by race and ethnicity. Figure 3 below shows the estimated household income distribution for households in the Tri-City Subregion by race and ethnicity, according to American Community Survey (ACS) data collected between 2013 and 2017 (the most recent available for this dataset), as provided in Comprehensive Housing Affordability Strategy (CHAS) data. Among Asian households, the household income distribution includes a larger share of households with moderate incomes and above-moderate incomes than households in the Tri-City Subregion overall. Among all other racial and ethnic groups, the share of moderate-income and above moderate-income households is smaller than the share in the Tri-City Subregion overall, with a larger share of lower-income households.
Figure 3: Household Income Level by Race and Ethnicity, Tri-City Subregion
Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
7 HOUSING STOCK
As of 2020, the Tri-City Subregion had a total of 114,065 housing units, equal to approximately 19 percent of the countywide inventory. The City of Fremont, with approximately 77,300 units, accounts for roughly two-thirds of the total Tri-City Subregion inventory. Most of the existing housing units in the Tri-City Subregion are single family units (both attached and detached), which comprise approximately 73 percent of the housing units in the Tri-City Subregion. The share of multifamily units in the Tri-City Subregion (26 percent) is much lower than the share in the County (39 percent)
Like households in Alameda County overall, most households in the Tri-City Subregion are owners. Renter households comprise approximately 35 percent of the households in the Tri- City Subregion, compared to 46 percent of households countywide.
Figure 4: Housing Units by Type, 2020
Sources: State of California, Department of Finance, Table E-5; BAE, 2021.
Fremont New ark Union City TotalTotal Housing Units 77,309 14,917 21,839 114,065Single Family Detached 44,700 10,385 13,711 68,796Single Family Attached 10,192 1,414 2,847 14,453Multifamily 2 to 4 Units 2,584 659 804 4,047Multifamily 5 or More Units 19,107 2,459 3,461 25,027Mobile Home/Other 726 0 1,016 1,742Percent Single Family 71.0% 79.1% 75.8% 73.0%Percent Multifamily 28.1% 20.9% 19.5% 25.5%Tri-City Subregion60%52%13%8%4%11%22%28%2%1%0%10%20%30%40%50%60%70%80%90%100%Tri-City Subregion Alameda CountyMobile Home/OtherMultifamily 5 or More UnitsMultifamily 2 to 4 UnitsSingle Family AttachedSingle Family Detached
8 DISPLACEMENT ANALYSIS
This chapter assesses the extent to which displacement has affected Tri-City households, both in absolute terms and in comparison to Alameda County as a whole, and whether Tri-City households are currently at risk of displacement based on an analysis of various data sources.
In the context of neighborhood change, the term “displacement” typically refers to existing residents’ involuntary movement out of the community, usually due to increases in housing costs and strong demand for housing coupled with a shortage of options for lower-income households.
While there is a shortage of data that can provide direct information on whether displacement has occurred or whether households are at risk of displacement, there are various data sources that provide information that, taken together, provide an indication of the extent to which households are impacted by displacement. Data that could indicate that households have been displaced or are at risk of displacement include:
Significant increases in residential rents and sale prices; Rents and sale prices that exceed the affordability threshold for lower-income households, generally defined as those earning 80 percent of AMI or less; Low residential vacancy rates;
Decreases in the number of lower-income households over time; High rates of high housing cost burden among lower-income households; Overcrowding in residential units; and
A shortage of units affordable to lower-income households; Changes in commute patterns that demonstrate an increase in workers commuting from longer distances.
The following pages present data and analysis on these indicators to assess the extent to which Tri-City households are impacted by displacement. The analysis focuses on lower- income renter households, as these are the households that would be eligible for units funded through Measure A1 funds, but also provides information on other types of households. In general, renters tend to be more susceptible to displacement than homeowners because renters are generally not protected from rent increases except as stipulated in their lease agreement, which may provide no protection from increases or only relatively short-term protection. In markets with increasing residential rents and a limited supply of affordable rental housing, lower-income renters are often vulnerable to displacement as property owners increase rents to match market rates. In contrast, homeowners’ housing costs are not impacted by changes in the housing market after the homeowner purchases the unit, which generally gives homeowners a choice as to whether they sell their homes and move elsewhere.
However, homeowners can be susceptible to displacement if their economic circumstances change or if home repairs become unaffordable, making them unable to stay in their homes.
If there are limited affordable options locally, these residents could be displaced to other communities.
9 MULTIFAMILY RENT TRENDS
Rapid increases in multifamily rents and low levels of new construction have contributed to displacement pressures for lower-income households in the Tri-City Subregion. Between the first quarter of 2010 and the first quarter of 2020, average monthly asking rents in the Tri-City Subregion increased by 55 percent, or $868 per unit, in market-rate multifamily developments with five or more units. Over the same period, the countywide average monthly asking rent among these developments increased $715 per unit, or 44 percent. As of the first quarter of 2021, average monthly asking rents were $2,313 per unit in the Tri-City Subregion and $2,248 per unit in Alameda County overall, slightly down from the first quarter of 2020. This recent decrease in rents is likely temporary, due to the effects of the COVID-19 pandemic.
Rents in the Tri-City Subregion and the County have stabilized and increased slightly in recent months, potentially an indication that further rent decreases are unlikely and that rent increases will continue over the next several months.
Figure 5: Average Multifamily Asking Rents, Q1 2010-Q1 2021
Note: Data reflect units in market rate multifamily complexes with 5 or more units.
Sources: CoStar; BAE, 2021.
City ofCity ofCity ofTri-CityAlamedaSummary, Q4 2020FremontNewarkUnion CitySubregionCountyAsking RentsAvg. Asking Rent, Q1 2010 $1,577 $1,596 $1,567 $1,577 $1,622Avg. Asking Rent, Q1 2020 $2,461 $2,327 $2,394 $2,445 $2,337% Change 56.1% 45.8% 52.8% 55.0% 44.1%
10 AFFORDABILITY OF MULTIFAMILY RENTAL MARKET
Lower-income renters in the Tri-City Subregion are unlikely to be able to afford market-rate rents in the Subregion and may face displacement risk due to recent or future rent increases.
As shown in Figure 6, current market-rate multifamily rents in the Tri-City Subregion greatly exceed the affordability thresholds for households earning less than 60 percent of AMI. For a three-person household (the average renter household size in Tri-City), the difference between the maximum affordable rent for a household earning 60 percent of AMI and the current market-rate rent for a two-bedroom unit is $855. For a four-person household at the same income level, the maximum affordable monthly rent is $1,338 lower than the average market- rate three-bedroom rent ($3,178). Based on current average market rents, a four-person household earning 60 percent of AMI would only be able to afford to rent a market-rate studio unit in the Tri-City Subregion. This gap between affordable rents and market-rate rents indicates that many lower-income renter households in the subregion are likely vulnerable to displacement due to high housing costs. While a similar trend exists countywide, the average rent in the Tri-City subregion is slightly higher than the Alameda County average (see Figure 5), creating a slightly larger gap between affordable rents and market-rate rents in the Subregion.
Figure 6: Affordability of Market-Rate Rental Housing in Tri-City Subregion
Notes:
(a) Market rents reflect average asking rates in multifamily properties with 5+ units in the Tri-City Subregion as of Q1 2021. (b) Maximum affordable housing costs are defined as 30% of gross monthly household income, the maximum amount that a household can spend on housing expenses without being considered cost burdened. Affordable rents account for the cost of utilities, based on Housing Authority of the County of Alameda 2020 allowances for tenant-furnished utilities and other services for a multifamily unit that uses gas cooking, heating, and water heating, as well as electricity for lights and appliances. The allowance is based on the number of bedrooms in the unit and a household is assumed to have one bedroom fewer than the number of people in the household.
Sources: California HCD, 2020; CoStar, 2021; Housing Authority of the County of Alameda, 2020; BAE, 2021. $784$1,305$1,566$2,089$881$1,469$1,763$2,350$979$1,631$1,958$2,610$2,523 $2,0393 Bedroom Market Rate Rent2 Bedroom Market Rate Rent1 Bedroom Market Rate Rent$3,178$0$500$1,000$1,500$2,000$2,500$3,000$3,50030% AMI(Extremely Low)50% AMI(Very Low)60% AMI(Low)80% AMI(Low)Maximum Affordable Monthly Housing Costs2 person household3 person household4 person household
11 MULTIFAMILY RENTAL VACANCY RATE
Despite recent upticks in vacancies in 2020, the multifamily vacancy rate throughout the Tri- City Subregion has been extremely low since 2010, contributing to upward pressure on rents and leaving limited options for displaced households to stay in their communities. Between 2010 and 2019, the multifamily rental vacancy rate generally averaged less than five percent in the three cities and the Tri-City Subregion overall, with the exception of a few quarters directly following the construction of new units that were in the lease-up phase. Although multifamily rental vacancy rates in 2020 and the beginning of 2021 have been uncharacteristically high due to the impact of the COVID-19 pandemic, recent data show a downward trend in Fremont, Union City, Newark, and the Tri-City Subregion overall. As of the first quarter of 2021, the multifamily rental vacancy rate in the Subregion (6.9 percent) was substantially lower than the overall multifamily rental vacancy rate in Alameda County (9.1 percent) and was exhibiting a sharp downward trend, while the vacancy rate countywide was continuing to increase. In Union City, the multifamily rental vacancy rate had fallen below five percent by the first quarter of 2021, which is typically considered a threshold that indicates a shortage of rental housing supply.
Figure 7: Multifamily Rental Vacancy Rate, Q1 2010-Q3 2020
Note: Data reflect units in market rate multifamily complexes with 5 or more units.
Sources: CoStar; BAE, 2021.
12 HOME SALE PRICE TRENDS
Growth in home sale prices has considerably outpaced growth in household incomes since the Great Recession, making homeownership increasingly unobtainable for many lower-income households. Since 2012, the median single family home price in Alameda County has increased by $582,000, or 135 percent. During the same period, the median income in Alameda County increased by just 27 percent. Single family home sale price trends in Newark and Union City have roughly tracked overall trends in the County, while home sale prices in Fremont have been consistently higher than sale prices in Alameda County overall. As of 2020, the median sale price for single family homes in Fremont was $1.25 million. In Newark, Union City, and Alameda County, the median sale price for single family homes was just over $1.0 million.
Figure 8: Median Single-Family Home Sale Prices, 2012-2020
Sources: 2020 rereport.com; BAE, 2021.
ChangeMedian Sale Price - Single Family Homes2012-202020122014201620182020$%Fremont $578,250 $800,000 $945,000 $1,225,000 $1,250,000$671,750 116%Newark $380,000 $596,000 $740,000 $970,000 $1,015,000$635,000 167%Union City $431,000 $635,000 $775,000 $1,020,000 $1,015,000$584,000 135%Alameda Co. $430,000 $665,000 $780,000 $929,000 $1,012,000$582,000 135%Alameda Co. AMI $93,500 $93,500 $93,600 $104,400 $119,200$25,700 27%4 person HH
13 Sale prices for condominiums and townhomes, which have historically provided more affordable ownership options, have also increased significantly over the past decade, bringing homeownership further out of reach for many lower-income households. In 2020, the median sale price for condominiums and townhomes in Alameda County was $665,000, an increase of 177 percent from the median sale price in 2012. In the Tri-City Subregion, median sale prices for condominiums and townhomes grew by 173 percent in Union City, 186 percent in Fremont, and 215 percent in Newark between 2012 and 2020. As noted above, the median income in Alameda County increased by just 27 percent over the same period. The considerable mismatch between increases in income and increases in home sale prices has pushed homeownership further out of reach for many households during this time period. As of 2020, the median sale price for condominiums and townhomes in Fremont ($800,000) was twenty percent higher than the countywide median, while the median in Newark ($692,500) exceeded the countywide median by roughly four percent. The median sale price in Union City ($590,000) was relatively more affordable, although this sale price would still be considered unaffordable to the vast majority of lower-income households with incomes below 80 percent of AMI.
Figure 9: Growth in Median Condominium and Townhome Sale Prices, 2011-2020
Sources: 2020 rereport.com; BAE, 2021.
ChangeMedian Sale Price - Condos/Townhomes2012-202020122014201620182020$%Fremont$280,000$470,000$567,000$750,000$800,000$520,000 186%Newark$220,000$371,000$500,000$675,000$692,500$472,500 215%Union City$216,500$355,000$470,000$617,500$590,000$373,500 173%Alameda Co.$240,000$431,000$535,000$650,000$665,000$425,000 177%Alameda Co. AMI,4 person HH$93,500$93,500$93,600$104,400$119,200$25,700 27%$280,000$800,000$220,000$692,500$216,500$590,000$240,000$665,000$0$100,000$200,000$300,000$400,000$500,000$600,000$700,000$800,000$900,0002012 2014 2016 2018 2020FremontNewarkUnion CityAlameda Co.
14 AFFORDABILITY OF FOR-SALE HOUSING MARKET
The vast majority of lower and moderate-income households are not able to afford to purchase a home in the Tri-City Subregion and are therefore unable to benefit from the relative stability and protection from displacement that homeownership provides. Compared to renters, homeowners are more protected from displacement pressures because homeowners’ housing costs are not impacted by changes in the housing market after the homeowner purchases the unit. As of 2020, the median single family home sale price was just over $1.0 million in Alameda County. As shown below, an annual household income of $183,300 or more would be needed to comfortably afford a single-family home at this sale price. The median priced single family home in Fremont, at $1.25 million, would be unaffordable to households earning less than $225,100. Even in the relatively more affordable City of Union City, a household would need to earn at least $123,900 to afford the median priced condominium or townhome.
Due to the unaffordability of for-sale housing in the Tri-City Subregion, most low- and moderate-income renters are unlikely to be able to buy their first home and therefore must continue renting, foregoing the relative stability that homeownership can provide, or leave the community to purchase a home.
Figure 10: Minimum Qualifying Income Required to Purchase Median Sales Priced Home in 2020
Sources: rereport.com; California Department of Housing and Community Development, 2020; Freddie Mac, 2020; California Department of Insurance; San Mateo County Controller's Office, 2019-2020; BAE, 2021.
15 HOUSING COST BURDEN
Most existing lower-income households in the Tri-City Subregion already spend more than 30 percent of their gross incomes on housing costs, making them extremely vulnerable to displacement from any future rent increases. In general, renters tend to experience more serious and widespread housing cost burden than owners. Of the 14,445 lower income renter households (those with incomes below 80 percent of the HAMFI) in the Tri-City Subregion, 11,880 (82 percent) are rent burdened, paying more than 30 percent of their incomes on rent.
Households in Fremont face the most severe housing affordability challenges, with approximately 85 percent of lower-income renter households spending more than 30 percent of their incomes on rent. Compared to the Tri-City Subregion overall, a lower share of the lower-income renter households in Union City are rent-burdened (75 percent). However, Union City stands out for its relatively high share of lower income owner households that are cost burdened (60 percent).
Housing Cost Burden & Displacement Risk
Households are generally considered to have a high housing cost burden if they spend more than 30 percent of household income on housing costs. For lower-income households in particular, spending more than 30 percent of income on housing costs often means that households are struggling to afford housing and are unlikely to be able to afford any future rent increases. Lower-income households with high housing cost burden are often at risk of displacement in housing markets in which prices are increasing because they are vulnerable to rent increases that would force them to move or lead to nonpayment of rent and eventual eviction.
16 Figure 11: Housing Cost Burdened Lower Income Households in the Tri-City Subregion, 2013-2017
Note: A household is considered to be overpaying (or cost burdened) if it spends more than 30 percent of its gross income on housing.
Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
FremontNewarkUnion CityTotalTotal Lower Income Households17,6154,2007,20029,015Number of Lower Income Households Overpaying 12,670 2,715 4,820 20,205Percent of All Lower Income Households Overpaying 72% 65% 67% 70%Lower Income Renter Households9,0101,9303,50514,445Number of Lower Income Renter Households Overpaying 7,650 1,610 2,620 11,880Percent of All Lower Income Renter Households Overpaying 85% 83% 75% 82%Lower Income Owner Households8,6052,2703,69514,570Number of Lower Income Owner Households Overpaying 5,020 1,105 2,200 8,325Percent of All Lower Income Owner Households Overpaying 58% 49% 60% 57%Tri-City Subregion
17 Lower-income renters in the Tri-City Subregion are more likely to be cost-burdened than lower income renters in Alameda County overall. Approximately 82 percent of lower income renter households (those with incomes below 80 percent of the HAMFI) in the Tri-City Subregion are housing cost burdened, with 43 percent facing severe cost burdens and spending more than 50 percent of their incomes on rent. Countywide, 77 percent of lower income renter households are housing cost burdened, with 42 percent spending more than 50 percent of their gross incomes on rent.
Figure 12: Cost-Burdened Lower Income Renter Households, Tri-City Subregion and Alameda County, 2013-2017
Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
18 There has been a notable increase in the number of cost-burdened lower income renter households in the Tri-City Subregion since 2010. Between 2010 and 2017, the number of cost-burdened lower-income renter households in the Tri-City Subregion increased by 1,236 households, or 12 percent. Countywide, the number of cost-burdened lower income renter households increased by five percent, or 5,465 households, during the same period. As shown in Figure 13, the City of Newark experienced rapid growth in cost-burdened lower- income renters, with the total number of cost-burdened lower income renter households increasing by 34 percent (410 households) during this period.
Figure 13: Growth in Cost-Burdened Lower Income Renter Households, Tri-City Subregion, 2010-2017
Note: A household is considered cost burdened if it spends more than 30 percent of its gross income on housing. Lower income households are defined as those earning less than or equal to 80 percent of the HAMFI.
Sources: U.S. Department of Housing and Urban Development, 2006-2010 & 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
2010 2017 Net Change % ChangeTri-City Subregion 10,644 11,880 1,236 12%Fremont 6,915 7,650 735 11%New ark 1,200 1,610 410 34%Union City 2,529 2,620 91 4%Alameda County 102,280 107,745 5,465 5%Cost-Burdened Low er Income Renter Households3,4253,4853,7344,3203,5354,02505001,0001,5002,0002,5003,0003,5004,0004,5005,000Extremely Low Income(≤30% HAMFI)Very Low Income(>30% to ≤ 50% HAMFI)Low Income(>50% to ≤ 80% HAMFI)Cost-Burdened Lower Income Renter Households20102017
19 COST BURDEN BY RACE AND ETHNICITY
Among Tri-City households that would be eligible for units financed through Measure A1 funds, there is likely little to no difference between racial and ethnic groups in the prevalence of high housing cost burden and the associated risk of displacement. Figure 14 shows the racial and ethnic distribution of Tri-City renter households with a high housing cost burden as well as the distribution of lower-income renter households by race and ethnicity. As shown, the racial and ethnic distribution of renter households with a high housing cost burden essentially mirrors the distribution of lower-income renter households by race and ethnicity. While the data on rent- burdened households below are for all rent-burdened households rather than lower-income rent-burdened households specifically, the households captured in these data are mostly lower-income households, which comprise 76 percent of all rent-burdened households in the Subregion. These data suggest that the demographics of households with a high housing cost burden are similar to the demographics of lower-income renter households. Figure 12 above further supports this finding by demonstrating that almost all lower-income renters in the Tri- City Subregion have a housing cost burden higher than 30 percent, leaving little room for variation between groups.
Figure 14: Racial and Ethnic Composition of Rent Burdened Households, Tri-City Subregion, 2013-2017
Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
24%23%9%8%27%27%33%35%7%7%0% 20% 40% 60% 80% 100%Lower-IncomeRenterHouseholdsRent BurdenedHouseholdsHispanicBlack/African-AmericanWhiteAsianAll Other
20 OVERCROWDING
Renter households in the Tri-City Subregion experience extremely high levels of overcrowding, an indication that renter households in the Tri-City Subregion are struggling to find and afford housing. The U.S. Census defines overcrowded housing units as those that are occupied by more than one person per room and severely overcrowded units as those that are occupied by more than 1.5 persons per room. As shown in Figure 15, approximately 22 percent of the renter-occupied units in the Tri-City Subregion are considered overcrowded, compared to approximately 13 percent countywide. The overcrowding rate in Newark (27 percent) is more than double the rate in the County and well above the rate in the Tri-City Subregion as a whole.
Figure 15: Renter Household Overcrowding, 2015-2019
Note: The U.S. Census defines an overcrowded unit as one occupied by more than 1 person per room. A severely overcrowded unit is one occupied by more than 1.5 persons per room.
Sources: U.S. Census Bureau, American Community Survey, 2015-2019 five-year sample data; BAE, 2021.
22%13%7%5%0%5%10%15%20%25%Tri-City Subregion Alameda CountyPercent OvercrowdedShare of Renter Households in Overcrowded UnitsPercentOvercrowdedPercent SeverelyOvercrowded15%8%AlamedaFremont New ark Union City Total CountyTotal Renter-Occupied Units 29,775 4,378 7,571 41,724 268,286Number Overcrow ded 6,288 1,178 1,618 9,084 34,587Percent Overcrow ded 21% 27% 21% 22% 13%Number Severely Overcrow ded 1,822 405 560 2,787 13,737Percent Severely Overcrow ded 6% 9% 7% 7% 5%Tri-City Subregion
21 RENTER HOUSEHOLDS IN SINGLE FAMILY UNITS
Forty-one percent of the Tri-City Subregion’s renter households live in single-family units, which can indicate an increased displacement risk in strong housing markets such as the Tri-City Subregion. Single family units tend to be larger than multifamily units and likely fill an important role in housing the Tri-City Subregion’s larger renter households. However, renters living in single-family homes can be particularly vulnerable to displacement in strong housing markets because they are susceptible to the same potential rent increases as other renters but could also be displaced if an owner decides to sell the home while sale prices are high. In Newark, single family rentals make up more than half of the rental housing stock. The average renter household size in Newark is also notably high, at 3.62 persons per household.
Figure 16: Renter Households in Single Family Units, 2015-2019
Sources: Sources: U.S. Census Bureau, American Community Survey, 2015-2019 five-year sample data; BAE, 2021.
AlamedaFremont Newark Union City Total CountyTotal Renter Households 29,775 4,378 7,571 41,724 268,286Number of Renter HHs in SF Units 11,441 2,234 3,284 16,959 79,361Percent of Renter HHs in SF Units 38% 51% 43% 41% 30%Average Renter Household Size 3.03 3.62 3.37 3.15 2.67Tri-City Subregion
22 HOUSING CHOICE VOUCHER USAGE
The number of households with housing choice vouchers living in the Tri-City Subregion has dwindled since 2010 and high market rate rents combined with a limited supply of voucher- eligible units make voucher recipients in the Tri-City Subregion especially vulnerable to displacement from future rent increases. As of March 2020, there were 2,024 voucher recipients living in the Tri-City Subregion, a decline of 17 percent from the 2,443 recipients living in the Tri-City Subregion in March 2010. Voucher recipients, particularly those with disabilities, have an extremely difficult time finding appropriate housing in markets such as the Tri-City Subregion where average market rents are higher than the HUD FMR used to determine maximum Section 8 rents As of the first quarter of 2021, monthly market-rate rents in the Tri-City Subregion averaged $1,751 for a studio, $2,039 for a one-bedroom unit, $2,523 for a two-bedroom unit, and $3,178 for a three-bedroom unit. Meanwhile, the FMR for Alameda County was $1,595 for a studio, $1,934 for a one-bedroom unit, $2,383 for a two- bedroom unit, and $3,196 for a three-bedroom unit, meaning that only three-bedroom units had average market-rate rents that were consistent with the FMR. The escalation in market rents above the HUD FMR has led some landlords to cease accepting vouchers, resulting in a dwindling inventory of voucher eligible units in the Tri-City Subregion. The Tri-City Subregion accounts for a disproportionate share of the total decline in voucher recipients in the Housing Authority of the County of Alameda’s (HACA) jurisdiction since 2010. While the Tri-City Subregion was home to approximately 34 percent of all voucher holders in HACA’s jurisdiction in 2010, the decrease of 419 voucher recipients living in the Subregion accounts for 60 percent of the total decline in voucher recipients throughout HACA’s jurisdiction (see Figure 17).
23 Figure 17: Housing Authority of the County of Alameda (HACA) Housing Choice Vouchers, March 2010-March 2020
Note: HACA's jurisdiction excludes the cities of Alameda, Berkeley, Livermore, and Oakland.
Sources: Housing Authority of the County of Alameda (HACA); BAE, 2020. 0-142719-106-288-422-413-440-470-4190154398424213-195-599-649-604-696-702-800-600-400-2000200400600Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20Net Change in Section 8 Vouchers Since March 2010Tri-City SubregionTotal (All HACA Jurisdictions)Tri-City accounted for 60% of the net decline in total HACA vouchers, despite making up just 34%of all HACA vouchers in 2010.20102011201220132014201520162017201820192020Tri-City Total 2,443 2,429 2,470 2,462 2,337 2,155 2,021 2,030 2,003 1,973 2,024HACA Total 7,139 7,293 7,537 7,563 7,352 6,944 6,540 6,490 6,535 6,443 6,437Tri-City % ofHACA TotalTotal Housing Choice Vouchers34% 33% 33% 33% 32% 31% 31% 31% 31% 31% 31%
24 CHANGE IN LOWER-INCOME HOUSEHOLDS
Since 2010, the Tri-City Subregion has experienced significant shifts in lower-income households, suggesting that lower-income households have been displaced due to high housing costs. As shown in Table 1 below, the Tri-City Subregion experienced a small net increase of 260 lower-income households (those with incomes below 80 percent of the HAMFI) between 2010 and 2017. This change amounted to a 0.9-percent net increase in the Subregion’s lower-income population. In contrast, the number of lower-income households in Alameda County overall increased by 7,100 households, or 3.4 percent. Table 2 shows a similar trend among renter households, though with a more pronounced difference between the Subregion (0.7 percent increase in lower-income renter households) and the County (4.1 percent increase in lower-income renter households). This suggests that lower-income households have experienced more difficulty finding housing in the Tri-City Subregion than in Alameda County overall.
Despite the slight increase in lower-income households, the data in Table 1 and Table 2, as well as data presented elsewhere in this report, indicate that some lower-income households were displaced during this period, though the net impact of this displacement was counteracted by simultaneous demographic shifts that resulted in a slight net increase in lower-income households. The Tri-City subregion experienced a 17-percent increase in extremely low-income households (those with incomes less than or equal to 30 percent of HAMFI), while the number of very low-income households (those with incomes between 30 percent and 50 percent of HAMFI) increased only slightly and the number of low-income households (those with incomes between 50 percent and 80 percent of HAMFI) decreased by 11 percent. Trends were similar among Tri-City renter households. Without data that track individual households over time, it is not possible to quantify the extent to which each of these changes by income group reflect displacement, changes in households’ incomes, or new households moving into the Subregion. For example, the Subregion could hypothetically have experienced displacement of 200 lower-income households over the same period that 50 moderate-income households became low-income households due to a decrease in income and 175 lower-income households moved into the Subregion. In this case, the data would show a net increase of 25 lower-income households (50 changing from moderate to low + 175 new moving in - 200 displaced), despite that 200 households were displaced during this period. The available data do not provide enough information to fully understand the nuances of the demographic change that occurred during this period. However, the trends shown in Table 1 suggest that at least some of the changes in the Tri-City’s lower-income population have been due to displacement, particularly when coupled with the data shown Figure 18 below, which demonstrates that the racial and ethnic composition of lower-income households in the Tri-City Subregion also changed during this period. While similar trends occurred countywide, the more significant overall growth in lower-income households countywide indicate that lower-income households in the Tri-City subregion have generally experienced displacement at a greater rate than lower-income households in Alameda County overall.
25 Table 1: Households by HUD Area Median Family Income (HAMFI) Level, 2010-2017 Notes:
(a) CHAS data reflect HUD-defined household income limits. Income thresholds are defined as a percent of the HUD Area Median Family Income (HAMFI).
(b) Totals do not equal the sum of individual figures due to independent rounding.
Sources: U.S. Department of Housing and Urban Development, 2006-2010 & 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
Household Income Level (a)2010 2017 Number PercentExtremely Low Income (≤30% HAMFI) 8,125 9,510 1,385 17.0%Very Low Income (>30% to ≤ 50% HAMFI) 8,420 8,650 230 2.7%Low Income (>50% to ≤ 80% HAMFI) 12,210 10,855 -1,355 -11.1%Moderate Income (>80% to ≤ 120% HAMFI) 18,250 20,105 1,855 10.2%High Income (>120% HAMFI) 54,610 59,000 4,390 8.0%Total Households (b)101,625 108,115 6,490 6.4%Less Than or Equal to 80% HAMFI (a)28,755 29,015 260 0.9%Household Income Level (a)2010 2017 Number PercentExtremely Low Income (≤30% HAMFI) 78,920 88,375 9,455 12.0%Very Low Income (>30% to ≤ 50% HAMFI) 58,335 63,840 5,505 9.4%Low Income (>50% to ≤ 80% HAMFI) 73,975 66,115 -7,860 -10.6%Moderate Income (>80% to ≤ 120% HAMFI) 93,820 97,975 4,155 4.4%High Income (>120% HAMFI) 226,960 252,770 25,810 11.4%Total Households (b)532,010 569,075 37,065 7.0%Less Than or Equal to 80% HAMFI (a)211,230 218,330 7,100 3.4%Alameda County2010-2017 Change2010-2017 ChangeTri-City Subregion
26 Table 2: Renter Households by HUD Area Median Family Income (HAMFI) Level, 2010-2017
Notes:
(a) CHAS data reflect HUD-defined household income limits. Income thresholds are defined as a percent of the HUD Area Median Family Income (HAMFI).
(b) Totals do not equal the sum of individual figures due to independent rounding.
Sources: U.S. Department of Housing and Urban Development, 2006-2010 & 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
Household Income Level (a)20102017NumberPercentExtremely Low Income (≤30% HAMFI) 4,620 5,205 585 12.7%Very Low Income (>30% to ≤ 50% HAMFI) 4,035 4,030 -5 -0.1%Low Income (>50% to ≤ 80% HAMFI) 5,695 5,210 -485 -8.5%Moderate Income (>80% to ≤ 120% HAMFI) 7,005 8,775 1,770 25.3%High Income (>120% HAMFI) 11,91515,8703,95533.2%Total Households (b)33,28039,0855,80517.4%Less Than or Equal to 80% HAMFI (a)14,35014,445950.7%Household Income Level (a)20102017NumberPercentExtremely Low Income (≤30% HAMFI) 60,905 67,065 6,160 10.1%Very Low Income (>30% to ≤ 50% HAMFI) 36,640 40,385 3,745 10.2%Low Income (>50% to ≤ 80% HAMFI) 42,385 38,270 -4,115 -9.7%Moderate Income (>80% to ≤ 120% HAMFI) 43,730 49,170 5,440 12.4%High Income (>120% HAMFI) 55,08072,52517,44531.7%Total Households (b)238,750267,40528,65512.0%Less Than or Equal to 80% HAMFI (a)139,930145,7205,7904.1%2010-2017 ChangeTri-City Subregion2010-2017 ChangeAlameda County
27 CHANGE IN LOWER-INCOME RENTER HOUSEHOLDS BY RACE
AND ETHNICITY
Recent changes in the Tri-City Subregion’s lower-income renter households have had disproportionate impacts on White, Black and African American, and Hispanic and Latino populations. Between 2010 and 2017, the number of lower-income renter households in the Tri-City Subregion increased slightly, by less than one percent overall. Meanwhile the number of lower-income White, Black and African American, and Hispanic and Latino renter households decreased by 5 percent, 14 percent, and 4 percent, respectively. For all other racial and ethnic groups, the number of lower-income renter households increased. These data further underscore that recent changes in the Tri-City’s lower-income population, as shown in Table 1 and Table 2 above, are likely due at least in part to some households moving out due to displacement, despite a minimal change in the number of lower-income households in the Subregion.
Figure 18: Change in Lower-Income Renter Households by Race and Ethnicity, 2010-2017
Note: Data shown reflect the difference between ACS data collected during the 2006-2010 period and ACS data collected during the 2013-2017 period.
Sources: U.S. Department of Housing and Urban Development, 2006-2010 & 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2020.
White(222)American Indian / Alaskan Native68 Black / African-American(206)Asian275 Pacific Islander40 Other257 Hispanic / Latino(136)-300-200-10001002003005%Decrease14% Decrease4% Decrease
28 SCHOOL DISTRICT ENROLLMENT TRENDS
All three school districts in the Tri-City Subregion have experienced declines in student enrollment in recent years, indicating that families with children have been moving out of the Tri-City area. Between the 2014-15 and 2019-20 school years, student enrollment in the New Haven Unified School District declined by 11 percent and enrollment in the Newark Unified School District declined by nine percent. The Fremont Unified School District (FUSD) experienced an overall increase in enrollment between the 2014-15 and 2017-18 school years but has experienced declines in student enrollment following the 2017-18 school year.
Meanwhile, enrollment in public school districts in the remainder of Alameda County increased slightly between the 2014-15 and 2017-18 school years and remained essentially flat between the 2017-18 and 2019-20 school years, indicating that the decreases in enrollment in the Tri-City Subregion school districts differ from the overall trend elsewhere in the County.
An analysis performed in 2018 by the New Haven Unified School District stated that declines in student enrollment are likely related to the cost of housing.2 Like the New Haven Unified School District, FUSD has associated the recent declines in student enrollment with increases in home prices and rents. FUSD has noted large and unexpected declines in student enrollment at elementary schools, suggesting that younger families are being disproportionately affected.3
Figure 19: Student Enrollment, 2014-15 through 2019-20
Sources: California Department of Education (ED-Data); BAE, 2021.
2 New Haven Unified School District 2018 Student Entry and Exit Analysis. 3 This topic was discussed during the October 16, 2019 FUSD Board meeting (https://video.ibm.com/recorded/124274027?t=7738).
5,6695,7585,9135,8456,0136,19611,04711,28111,61311,89312,17112,45935,43135,54435,77735,17134,85234,20805,00010,00015,00020,00025,00030,00035,00040,0002019-202018-192017-182016-172015-162014-15Newark USDNew Haven USDFremont USD
29 SPECIAL NEEDS POPULATIONS AND HOUSEHOLDS
The Tri-City Subregion is home to thousands of special needs households and individuals, including a significant number of seniors, large families, single female headed households with children, and persons with disabilities, which are more likely to have affordable housing needs and may face considerable hardship if displaced. As of 2019, the Tri-City Subregion had approximately 30,670 senior households, 15,030 large households, and 2,855 single- parent female headed households. More than 26,180 Tri-City residents have at least one disability, including 14,360 seniors. These special populations often face unique housing problems due to physical limitations, health care costs, and income, which makes it more challenging for them to find and pay for housing. In addition, many special needs households rely on services and social networks in their communities and could face severe hardship if displaced. For example, single-parent households may rely on family or friends that live nearby to help with childcare or may have established other childcare arrangements locally.
Individuals with disabilities may have established relationships with service providers or familiarity with local transit networks, making displacement particularly disruptive to their ability to meet critical needs. Seniors that are displaced could be forced to move away from necessary services and social networks. While displacement can negatively impact all types of households and individuals, special needs households are often disproportionately impacted by negative consequences from displacement.
Figure 20: Special Needs Populations and Households, Tri-City Subregion
Sources: U.S. Census Bureau, American Community Survey, 2015-2019 five-year sample data; BAE, 2021.
Special Needs Groups Fremont Newark Union City TotalSingle Female Headed Households 1,675 414 766 2,855Large Households 8,398 2,621 4,012 15,031Households w / One or More Senior 19,215 4,054 7,400 30,669Senior (65+) Living Alone 2,864 445 844 4,153Persons w ith Disabilities 16,509 3,561 6,114 26,184Seniors (65+) w ith Disabilities 9,082 1,823 3,457 14,362Tri-City Subregion
30 DISPLACEMENT RISK FOR SPECIAL NEEDS HOUSEHOLDS
Special needs households in the Tri-City Subregion tend to have lower incomes than other households, indicating that these households may experience disproportionate displacement risk. Figure 21 shows the distribution of household income levels among elderly households (defined by HUD as households with one or two persons, with either person 62 years of age or over) and the households that include at least one person with a disability in the Tri-City Subregion. As shown, elderly households and households that include at least one person with a disability are significantly more likely to have lower incomes, indicating that these types of special needs households could benefit disproportionately from housing that serves lower- income households. While comparable data are not available for single parent female-headed households, ACS data collected between 2015 and 2019 indicate that 9.5 percent of female- headed family households in the Tri-City Subregion have incomes below the poverty level, compared to just 2.8 percent of all family households in the Tri-City Subregion. To the extent that lower-income households are impacted by displacement pressures, these data suggest that elderly residents, residents with disabilities, and female-headed households are significantly more likely to be impacted than the population at large.
Figure 21: Income Distribution by Household Type, Tri-City Subregion, 2013-2017
Note: HUD defines an elderly household as a household with one or two persons, with either person 62 years or over.
Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
31 Among lower-income renter households in the Tri-City Subregion, elderly households and large family households are more likely to have a high housing cost burden, potentially indicating a disproportionate displacement risk for these households. Figure 22 shows housing cost burden for lower-income (less than 80 percent of the HAMFI) renter households, lower-income elderly households, and lower-income large family households in the Tri-City Subregion. As shown, among all Tri-City lower-income renter households, approximately 82 percent spend more than 30 percent of their income on rent, with 43 percent paying more than 50 percent of their income on rent. Large family lower-income households are much more likely to spend more than 30 percent of their incomes on rent than lower-income renter households in the Tri- City Subregion overall. In addition, approximately 53 percent of lower-income elderly renter households pay more than 50 percent of their income on housing, a significantly higher share than lower-income renters overall (43 percent). These figures indicate that at least some of these special needs populations that rent their homes are struggling to afford housing and are at a greater risk of displacement than lower-income renters in the Tri-City Subregion overall.
Figure 22: Housing Cost Burden Among Lower-Income Renters Households, Tri- City Subregion, 2013-2017
Note: Lower income households are defined as those earning less than 80 percent of the HAMFI. (a) HUD defines an elderly household as a household with one or two persons, with either person 62 years or over.
Sources: U.S. Department of Housing and Urban Development, 2013-2017 Comprehensive Housing Affordability Strategy (CHAS) data; BAE, 2021.
53%31%43%26%56%39%0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%ElderlyHouseholds(a)Large FamilyHouseholdsAll Tri-CityHouseholdsPercent of Households Share of Lower Income Renter Households Spending More than 30% of Income on Rent > 50% (Severely Rent Burdened)> 30%, but ≤50% (Rent Burdened)% of income spent on rent:
32 COMMUTE TRENDS
Worker commute flows data show a significant increase in the share of Tri-City workers commuting from locations outside the Tri-City Subregion, indicating that many people working in local jobs might be having a difficult time finding and affording housing. Between 2010 and 2018, the Tri-City Subregion’s overall workforce increased by approximately 46,490 workers, or 41 percent. As shown in Figure 23, the increase in the number of Tri-City workers living in Fremont, Union City, and Newark was significantly lower (13, 23, and 26 percent, respectively).
Meanwhile, there was a large increase in the number of Tri-City workers commuting from more affordable cities such as Hayward (62 percent), Stockton (150 percent), Oakland (70 percent), and San Jose (51 percent). At the county-level, San Joaquin and Stanislaus Counties saw the largest percentage increases in Tri-City workers between 2010 and 2018. These trends are likely due to a shortage of affordable housing options in the Subregion for the local workforce.
Figure 23: Change in Tri-City Workers by Place of Residence, 2010-2018
Sources: Longitudinal Employer-Household Dynamics via OnTheMap, 2010 & 2018; BAE, 2021. 2010 2018Total Tri-City Workers 114,535 161,022 46,487 41%Workers by Place of ResidenceAlameda County 52,012 66,804 14,792 28%Fremont 21,347 24,074 2,727 13%Hayward 5,529 8,934 3,405 62%Union City 6,327 7,759 1,432 23%Newark 4,229 5,337 1,108 26%Oakland 2,719 4,609 1,890 70%Santa Clara County 26,527 38,087 11,560 44%San Jose 14,856 22,450 7,594 51%San Joaquin County 4,149 7,403 3,254 78%Stockton 971 2,428 1,457 150%Contra Costa County 6,663 8,835 2,172 33%San Mateo County 4,999 6,890 1,891 38%Stanislaus County 1,916 3,165 1,249 65%All Other Counties 18,269 29,838 11,569 63%2010-2018 ChangeTri-City Workers28%33%38%44%65%78%0% 10% 20% 30% 40% 50% 60% 70% 80% 90%Alameda CountyContra Costa CountySan Mateo CountySanta Clara CountyStanislaus CountySan Joaquin CountyNet Increase in Tri-City Workers by County of Residence, 2010-2018 Total Net Increase in Tri-City Workers: 41%
33 SERVICE PROVIDER SURVEY RESPONSES
“The only way that clients are able to stay in the
Tri-City area is if housing such as BMR, low-income
housing becomes available.”
Local service providers report that displacement is a serious issue in the Tri-City Subregion and disproportionately impacts racial and ethnic minority groups and special needs households and individuals. As part of this study, a survey was sent to dozens of representatives from local service providers to ask whether Tri-City Subregion households are currently experiencing displacement or are at high risk of experiencing displacement. The service providers included agencies and organizations providing services to lower income households and individuals, persons experiencing homeless, elderly residents, residents with disabilities, and other vulnerable and underserved populations in Fremont, Newark, and Union City. Of the 21 service providers that responded to the survey, 16 said that their clients have moved out of Fremont, Newark, or Union City due to economic hardship; are currently at risk of displacement; and/or are planning to move out of Fremont, Newark, or Union City due to economic hardship or other reasons beyond their control. Service providers indicated that displacement pressures disproportionately impact low-income households, with a sizeable portion of respondents also reporting that displacement disproportionately impacts racial and ethnic minorities, people with disabilities, and seniors. Some service providers also reported that displacement pressure disproportionately impacts single-parent households, large families, and families with children.
34 SUMMARY OF FINDINGS
The City of Fremont has three affordable housing projects in the development pipeline that received Alameda County Measure A1 bond South County subregional funds. According to the County’s Measure A1 guidelines, the South County subregion consists of Fremont, Newark, and Union City, which is the area referred to as the Tri-City Subregion in this report. Alameda County requires that cities conduct a displacement study in order to apply a subregional live/work preference to affordable housing developments funded through County Measure A1 bond subregional funds. The displacement study must demonstrate that a) Tri-City Subregion residents are at greater risk of displacement than residents of Alameda County as a whole; b) current Tri-City residents are being displaced; and c) a local live/work preference would prevent further displacement. The City plans to apply this subregional live/work preference to three projects. A live/work preference would allow individuals and households who live or work in the South County subregion, and who meet eligibility requirements for units financed with Measure A1 funds, to have priority for units in these developments.
The information presented in this report demonstrates that all three of these conditions are met: Tri-City Subregion renters are at greater risk of residential displacement than renters in Alameda County overall, some lower-income Tri-City residents have likely already been displaced, and a local live/work preference would help to prevent further displacement:
a) Data on housing cost burden and overcrowding among Tri-City Subregion residents strongly indicate that Tri-City renters are more likely to be at risk of displacement than renters in Alameda County overall. Lower-income renters in the Tri-City Subregion are more likely to have a high housing cost burden than lower-income renters countywide. Similarly, renter households in the Tri-City Subregion experience extremely high levels of overcrowding and are much more likely to live in overcrowded units than are renter households in Alameda County overall. Facing higher average market rents and lower vacancy rates, Tri-City lower-income renters are much more vulnerable to displacement than the average lower-income renter household in Alameda County. In addition, Tri-City renters have experienced significant rent increases over the past decade, to a greater degree than renters in Alameda County as a whole.
b) Recent declines in the number of lower-income households, school district enrollment trends, and survey results from local social service providers suggest that Tri-City Subregion residents have likely already been displaced, while many remaining lower-income households in the Tri-City Subregion continue to be vulnerable to displacement. Displacement risk disproportionately impacts households and individuals with special housing needs, including seniors, people with disabilities, single-parent households, and large families.
c) For many lower-income Tri-City Subregion residents, a South County subregional live/work preference for affordable rental housing in Fremont is necessary to prevent displacement.
35 Since Tri-City Subregion’s lower-income renters are unlikely to be able to afford to purchase a home, they are typically limited to renting market-rate rental units. These rental units are generally more expensive than lower-income households can afford and do not provide residents with protection from future rent increases. Even residents with Housing Choice Vouchers are often unable to find housing in the Tri-City Subregion due to the high cost and limited availability of rental units. These findings highlight the need for Fremont to have a subregional live/work preference policy for affordable rental housing, including for projects funded by Alameda County Measure A1 bonds, to mitigate displacement among vulnerable populations in Fremont and the Subregion.