The future of housing is 'uncertain' as Salinas faces slow growth of new homes

In 2015, Salinas City Council approved a state-mandated plan that envisioned 2,229 new housing units over an eight-year period. So far, 986 have been approved, and city officials say they are not on track to achieve the pre-approved target.

Without new housing, residents continue to experience overcrowding, homelessness or little chances of obtaining an affordable place to live.

Community Development Director Megan Hunter says producing housing is a constant worry.

"I've seen it firsthand and I know what people have had to live with," she said. "I've been doing street outreach during the pandemic, and I know what folks on the streets are dealing with. Every day, I wake up and I think about housing."

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Hunter believes it's better for the city to have more homeowners so that everyone has a chance to establish generational wealth.

“Without that, communities affected by redlining, mostly people like African Americans or Latinos, have been cut out of middle-class opportunities,” she said. “It’s bad for the community because it’s not creating pathways for people to get out of poverty.”

Hunter says establishing more inclusionary housing, which requires developers to reserve a portion of new housing developments for low-income families, would also be a benefit to Salinas residents so that more people can achieve the American dream.

However, in order to buy a home in Salinas, folks have to overcome a number of obstacles.

Who can live in Salinas?

Salinas realtor Jairo Guerrero with Windermere Real Estate says much of the time, buying a home is easier for those working in high-earning jobs.

In April, the median listing home price in Salinas was $749,000. The median is the figure at which half the sales are higher, while half are lower.

With multiple offers being made, Guerrero says approval usually goes to whoever can make the biggest offer.

“We get up to 10 or more offers on one place, but we also have to look at all other factors like if they have a family, what is their living situation and who really needs it,” Guerrero said.

Guerrero estimates that people with incomes of at least $80,000-$100,000 yearly are those most likely to afford to buy homes in the area. More so for those in high local agriculture and industrial positions, for example.

Many financial advisors say the rule of thumb is that you shouldn’t spend more than 30% percent of your monthly income on housing.

Guerrero says that’s not realistic in today’s economy.

“Just recently, I had a client who backed out from an offer because they had fear,” Guerrero said. “They started to look at the big picture and looking at inflation, gas prices, everything that’s currently affecting their pockets. Others fear that if they buy now, the economy might crash, and we’ll be in a recession.”

For Guerrero, the future of the local housing market is uncertain.

Without new developments to even out the competition, he says prices will continue to soar and ultimately lead to more residents wanting to leave the state.

Breaking down barriers

Hunter says there are several barriers at play when it comes to development in the city, such as land availability and high cost of production.

According to the city’s Housing Element Annual Progress Report, 700 out of 986 approved units have gone to housing that serves the highest level of income.

Hunter says low-income families and the unsheltered remain the biggest priority, but approving more housing units for this population comes with some challenges.

“For lower incomes, it requires a lot of subsidy,” Hunter said. “If you look at any jurisdiction throughout California, they’re going to produce units on the higher end of the spectrum above moderate because that’s what the private market is driving.”

To remedy this, the city is placing a focus on establishing Accessory Dwelling Units (ADU), which are essentially blueprints to build smaller homes in an existing single-family lot.

According to the staff report, Salinas issued 278 housing related building permits representing the city’s 2021 Regional Housing Needs Allocation contribution.

Of these, 110 were for ADUs, two were for single-family dwellings, and 166 were for multi-family dwelling units.

“We’re really pushing on ADUs because we know we have a lot of overcrowded single-family homes,” Hunter said. “Instead of someone living in an unsafe garage that might not have basic services, we can provide the assistance to convert.”

ADUs do not have income restrictions and are needed across the city, but Hunter says they are typically seen more among middle class and low-income communities with greater housing challenges, such as in East Salinas.

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Hunter says the city is close to approving ADU plans and aims to unveil them by the end of June.

Another barrier, Hunter said, is that the city is struggling with “depressed property taxes.”

This happens when cities and jurisdictions don’t get enough money to provide for basic infrastructure. Those expenses are placed on developers, which leads to development impact fees.

In the case those fees are not waived, Hunter says, it’s not practical to build.

Councilman Steve McShane says while the city is taking steps to address the lack of housing, it's going to take time and finding the right partners.

"Infill and building up must be a priority of the city as well," he says. "We advocate for a rapid and easy to use permitting process and will continue to make recommendations on improvements."

He adds that lack of affordable housing is adding challenges to the local workforce, such as people who leave the county altogether to seek work and housing elsewhere, or people who have to travel from other counties to work in Salinas because they can't afford a place to live there.

"A housed and reliable workforce is among the top priorities of the Salinas Valley Chamber of Commerce," he says. "We hear regularly from members that without housing, we're never going to solve our labor challenges."

Building the future

The city has pursued three Project Homekey housing projects, where vacant motel locations are converted into affordable units, particularly for the chronically homeless.

Officials hope to have a fourth on the way soon.

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The city is currently seeking partnerships that may result in the smaller-type homes or congregate living type locations.

While some suggest the use of surrounding land throughout Monterey County to expand housing, Hunter says there are policies set in place to preserve the agriculture for food production.

Councilman Tony Barrera says he actively engages with residents in their neighborhoods to hear their needs.

While the topic of wanting surrounding ag land to be used to create more housing has not been brought up during city meetings, it's something council members have heard residents express.

Barrera says the city is currently working with the local ag industry to come up with solutions. The challenge, he says, is finding one that won't interfere with food production and still address the critical housing need.

"What I'm hearing from growers is that because of our technologies, they're looking at different ways of growing food," he says. "We're doing our best, but at the end, we're going to lose in one area or another. I don't think it this can really be a win-win situation. We're going to be impacted, but we have to make decisions."

Councilman Anthony Rocha says moving those barriers around could impact the work force and should be considered a last resort.

"People are worried about what the loss of agricultural jobs will mean for our farm worker community," Rocha said. "I've heard people express fear that they may not be able to find employment if agricultural jobs go away."

When residents see empty lots with no signs of development, it’s because they are built on flood planes or unstable fill.

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City officials are looking to rezoning certain properties, like the closed down Kmart location on Davis Road or the former Sears by the Northridge Mall, to encourage mixed-use developments that combine residential and commercial space.

"We're looking to do this in areas that can keep folks closer and connected to services and opportunities," Hunter explains.

The city currently works with developers and organizations like the Housing Authority of Monterey County and MidPen Housing to get financial support and address possible projects.

Hunter says that while seeking more partners, funding and support from private housing development employers is the right place to start, there is more that can be done as a whole community.

This would include property owners with ADUs renting out to people with vouchers or renting to college students and pushing for local school districts to build housing for teachers.

“If we shared that approach, we could do more,” she said. “If we’re just relying on a few housing nonprofits to build the tax credit deals, we’re never going to build our way out of this.”

This article originally appeared on Salinas Californian: Salinas residents continue to struggle to find affordable housing