The Bay Area has hundreds of below-market rate apartments sitting vacant

In April a new luxury apartment complex on Alameda s waterfront Launch opened to renters advertising views of the yacht club from its rooftop deck poolside cabanas and a co-working lounge As required by Alameda s inclusionary zoning law the developer Pacific Progress set aside of the units for low- and moderate-income households making between to of the area median income to for a single person The idea was to fill the complex with a variety of tenants not just the kind of renters who could afford a month Two years later the results are mixed units for the poorest tenants have filled but all designated for moderate-income renters the so-called missing middle remain empty much to the frustration of the developer Sean Murphy The last thing we want to do as a developer is build housing units that sit vacant he revealed That doesn t solve any social problems In other parts of the country moderate-income households don t need below-market rate apartments because they can afford the sphere But in the Bay Area even a couple making a year twice the area median income can barely swing a starter home The supply is so severely constrained that several high-income earners who in other places might be buying homes find themselves relegated to the rental sector To keep developers from building only at the top of the field state and city programs have sought to incentivize or in specific cases require new apartment complexes to reserve certain units for rent-restricted housing While those initiatives were first aimed at lower-income renters in up-to-date years those policies have expanded to consider moderate-income renters typically defined as people making between and of the area median income as below-market-rate renters But according to a review of rental input by this news organization hundreds of below-market-rate units across the Bay Area remain vacant months and sometimes even years after they opened for leasing That number is likely an undercount Just of the cities this news organization contacted provided occupancy details Moderate-income units reporting statistics had a vacancy rate of more than double that of units aimed at low-income renters There s never a shortage of very low-income renters but s are invariably tough to lease announced Stuart Gruendl whose firm BayRock has built mixed-income apartment complexes across San Francisco and the East Bay In places where rents have gone down a AMI renter can go out and get a great deal on a new apartment and get pretty awful close to the below-market rate rent That s the occurrence in the East Bay which has the greater part empty moderate-income units A number of luxury properties came on the sphere all around the same time Landlords have lowered market-rate rents which are now in line with specific of the units At Launch for example a one-bedroom apartment goes for Meanwhile certain market-rate units are genuinely priced lower at It may seem counterintuitive that below-market rate units are priced at levels in fact above territory function use strict window addEventListener message function a if void a statistics datawrapper-height var e document querySelectorAll iframe for var t in a material datawrapper-height for var r i r e i i if r contentWindow a source var d a material datawrapper-height t px r style height d It s a byproduct of the federal formula that determines affordability thresholds pegged not to actual realm rents but to the area median income a shifting figure calculated annually by the U S Department of Housing and Urban Improvement As the Bay Area s median income rises so do the caps on what s considered affordable even if the real rental sphere tells a different story Affordable housing isn t necessarily affordable and below-market rate housing isn t necessarily below sector rate revealed Alex Schafran a housing initiative researcher based in Oakland In cities like Alameda and Oakland where industry rents have softened post-pandemic the gap between approach and reality has become particularly glaring Market-rate developers are offering months of free rent that undercut the supposed discount of moderate-income units At ArtHaus Jack London a -square-foot studio rents at a month but with two months free on a -month lease the effective rent is a month That s less than what the below-market renters pay A drone view of the Atlas apartment tower right and the Tribune Tower in downtown Oakland Calif on Thursday May Jane Tyska Bay Area News Group At Launch Murphy reported he s hesitant to lower middle-income rents because they have to be high enough for the project to pay back its loans If he signs a lease at a lower rate the renter could be paying at that level for years given the city s rent control laws Despite the minimal discounts in specific places plenty of moderate-income housing has offered real relief In Courtney Welch was living in a West Oakland apartment when her landlord evicted her and her young son so he could move in She determined transitional housing and while there applied to a below-market rate unit at Avalon Populace Area in Emeryville Two years later she got a call she d been waiting for She was off the waitlist By she was making close to the area median income of for a family of two too much to qualify for one of the AMI units so she was relegated to the next tranche capped at of the AMI Welch paid for a two-bedroom apartment well below the maximum rent Avalon could have charged With the income that I had at that time I could have identified naturally occurring affordable housing but it would have been older housing with fewer amenities disclosed Welch who is now Emeryville s mayor Here I m living right next door to the Emeryville Constituents Region a park the Amtrak station she noted Do buildings at this rent level exist Yeah but they damn sure don t look like this In her income was too high to keep qualifying for her below-market unit but she decided to stay in the building In contemporary times she pays around for a three-bedroom unit a big jump but she credits the restricted rent she paid previously for giving her time to get her finances in order Moderate-income units provide the biggest benefit to renters in high-cost cities along the Peninsula and in Santa Clara County At The Anson a luxury complex in Burlingame a short walk from downtown a moderate-income one-bedroom apartment for a renter making up to goes for less than what a market-rate renter pays Just down the street at The Bower a moderate-income renter would pay for a studio while market-rate renters pay a month Related Articles is typical Californian s credit total How does that rank Gov Newsom picks housing over CEQA in bills aimed at speeding construction Is secret to California s housing affordability buried in its building code San Jose residents need to earn to afford rent San Jose incentive venture spurs multifamily maturation despite the economic challenges Part of the goal in building the moderate-income housing is for middle-income renters to have more choices disclosed Corey Smith head of the pro-housing lobbying group the Housing Action Coalition In other words give middle-income renters an option in new luxury buildings and landlords with older properties may have to lower their rents to compete Affordability advocates warn that without stricter rules though these units don t inevitably offer meaningful discounts We do find a flaw in the noted Murphy the Alameda developer He s in the midst of planning a new building in Alameda that will also need to include a number of below-market units but he ll be maxing out the number of low-income units rather than building more moderate-income units He wonders if cities should be encouraging the same What are the means these cities that want affordable housing can look at all the different metrics he disclosed so that we don t end up with empty housing