Lack of Housing Is Not the Problem

The San Francisco Bay Area has long been one of the most expensive places to live in the United States. The region, home to the booming Silicon Valley tech sector and a rising number of billionaires, also has one of the highest numbers of people without homes.

The 2015 Bay Area Equity Atlas found half of San Francisco Bay Area renters spent at least a third of their income on rent, and in 2021, Joint Venture Silicon Valley reported that the median annual wage of a service industry worker, at $35,241 before tax, was just slightly higher than the $25,800 it costs to rent a local studio apartment. 

It’s easy to find horror stories: paying $1,200 a month to live in a literal closet in San Francisco; $2,250 for a room with a fold-down bed; a $1,400 master bedroom in San José whose occupant is prohibited from cooking. In August 2020, The New York Times recounted the story of a Guatemalan immigrant who lived with 11 others in a three-bedroom home in the Bay Area city of San Mateo. When she contracted COVID-19, she sequestered herself in a closet for days to avoid infecting her children.

And those are just the examples of people with homes. Despite the region having an economy larger than that of Saudi Arabia, the Bay Area Council Economic Institute admitted in 2019 that “by virtually every measure, the Bay Area’s homeless crisis ranks among the worst in the United States.”

So many homeless riders slept on one overnight bus route between the Silicon Valley cities of Palo Alto and San José that it was known as “Hotel 22” until lawmakers cut late-night service. After a survey found one in five students at Cupertino’s De Anza College were homeless, students advocated for overnight parking lots so they could sleep in their cars. And RVs used as permanent residences have sprung up across Silicon Valley, including dozens clustered around a park 2 miles from Google’s Mountain View headquarters (until the city begins enforcing its new ban on RV and truck parking in late July). 

Plenty of Homes, Not Enough Power

For many in the Bay Area, the housing experience is less about shocking headlines than it is about the inexorable rise of rents driving more low- and moderate-income residents farther and farther out from the urban centers. 

Liz Gonzalez was born and raised in East San José by parents from Jalisco, Mexico. Her mother, brother, and uncle all worked in the microchip factories then prevalent in San José, as she herself did for a period. The assembly lines were “soul-sucking monotony,” she says, but the money was good. Though rents were high, “it wasn’t what you see right now, where there’s folks renting out rooms and garages and living rooms.” 

Gonzalez still lives in her childhood home today, though all but three other families on her street have moved away. “Affordability definitely factored into people moving away,” she says. The U.S. Bureau of Economic Analysis reports that San José now is the most expensive rental market in the country, with two-bedroom apartments renting for an average of $2,700 a month, according to rental platform Zumper.

Gonzalez is one of a growing number of activists looking at ways to change the housing economy of the region. She was involved in a multiyear campaign to stop Google from constructing a huge campus in San José, a development community leaders feared would price out tens of thousands of working-class residents. 

She is also president of the newly formed South Bay Community Land Trust. “This whole statement about us not having enough housing is a myth,” Gonzalez says. “We just don’t have the kind of housing that meets people’s needs, that is affordable, because the market-rate housing is out of reach.” 

“The only reason market-rate housing gets built at the rate it does is because they have institutional support,” she explains, adding that Silicon Valley already has enough homes for all who live there today. Gonzalez believes that what’s lacking is not empty buildings but organizations to support longtime residents the way developers and city governments rush to accommodate the interests of the multinational tech firms. 

The Bay Area is not an isolated case—only the most extreme example of a crisis affecting cities across the United States. A 2019 article in the Department of Housing and Urban Development’s journal Cityscape reported that across the country, 39% of 2016 renters paid rents that would have been in the top 25% in 2000, though renter income had barely increased in the same period. 

“Many major American cities showed signs of gentrification and some racialized displacement between 2000 and 2013,” reports a 2019 study by the National Community Reinvestment Coalition. That trend disproportionately affects Black and Hispanic tenants.

That’s resulted in higher real estate prices that median wages haven’t kept pace with. As a result, approximately 1.5 million people left the Bay Area between 2010 and 2016, the equivalent of one in five residents, according to the University of California’s Terner Center For Housing Innovation. For every person with household income above $200,000 who left the Bay Area in this period, six people with household incomes below $100,000 left as well. Those who moved into the area had incomes skewing significantly higher than those who moved out. 

The “crisis” is real, but it’s a crisis of housing ownership and affordability, a deficit not of housing stock but of popular power to constrain runaway costs. This sort of crisis cannot be remedied with construction permits or zoning laws, so community organizations are developing new answers on the ground.

Ordinary residents don’t have the political clout of tech companies and developers, and they also have been denied access to the skills necessary to acquire and manage residential properties. But activists are beginning to wield what power they do have. In 2019, the City of Oakland dedicated $12 million to preserving affordable housing with community land trusts and cooperatives. Then in 2020, two protest encampments pressured the Philadelphia Housing Authority to donate 50 houses to a new community land trust in that city, although activists now say the city hasn’t fulfilled that promise.

Changing the Economic Model For Housing

The power differential is why community groups are experimenting with alternative models of land ownership they believe are the key to stopping displacement and homelessness—without the construction of a single new unit of housing.

Groups such as the South Bay Community Land Trust and the East Bay Permanent Real Estate Cooperative see removing land from the speculative market, not advocating for new development, as the key to long-term accessibility. New land trusts are just one example of an organizing model that’s spread across the country since its birth as a way to keep Black farmers from being evicted by White landowners as retaliation for participation in the civil rights movement. 

“From our model, believing that housing is a human right,” says Gonzalez of the South Bay trust, “we have to act like it and do everything possible so that folks are housed in a dignified way.” 

Community land trusts typically comprise numerous properties, with the land held in trust by a community-based nonprofit organization, even as the housing units are sold. Many such trusts control the rate at which sale prices for homes in the trust can grow per year, ensuring owners can build equity while the units remain affordable for new buyers.  

Expanding the trust entails decommodifying land, one parcel at a time. 

The East Bay Permanent Real Estate Cooperative uses the cooperative model instead of a nonprofit trust to remove land from the market. The collective has attracted more than 100 community owners since its launch in 2018, according to East Bay Magazine. After starting two cooperative projects, the collective is now undertaking an ambitious effort to revitalize a historic West Oakland business corridor once known as “the Harlem of the West.” “We know that buying one asset is not enough,” says Noni Session, the East Bay group’s executive director. “We’re trying to galvanize the community around the entire corridor.” Organizers envision a Cultural Community Corridor featuring cooperative housing, Black arts and business spaces, and a cultural arts center along Seventh Street stretching a mile and a half through the city. 

The members of the fledgling South Bay trust have a similarly broad vision even as they continue negotiations to acquire their first properties. Co-founder Sandy Perry, a minister and housing activist who worked to oppose Google’s San José campus and who has been organizing with tenants, homeowners, and unhoused people for decades, believes decommodifying land within the trust will not only stabilize housing costs for residents but also “give a whole community a center around which to organize.” 

Aside from housing, South Bay trust members imagine day care centers, cultural centers, and “centers for the community to organize and resist gentrification,” Perry says. 

Taking land off the speculative market in the most expensive city in the country would provide an organizing base, a means for community survival, and a symbol of hope, he says. If community members can rally around and organize in community spaces on the land trust, he hopes, they might be able to stop the next tech campus development threatening to displace the city’s residents. 

The Challenge of Scale

This aspiration arises from the challenges facing groups like the South Bay trust and East Bay collective. The 12-year-old Oakland Community Land Trust has dozens of properties, including 28 single-family homes and five mixed-use properties, says Steve King, the group’s executive director. Redfin reports 472 houses were sold in the city in May 2021 alone, with a median sale price of $921,000. And San José’s market is even hotter, with 1,128 homes sold at an average price of nearly $1.3 million in the same period. 

So long as large employers like Google offer generous salaries to draw prospective employees to the region, housing values will continue to rise and make new and existing housing stock even more appealing for investors, developers, and speculators. As the University of California, Berkeley’s Urban Displacement Project explains, these processes work hand-in-hand: Wealthier newcomers move into a neighborhood at the same time capital gets invested in local real estate. This makes efforts to buy houses off the market increasingly urgent, but progressively more daunting, as well. 

If activist organizations are unable to secure concessions from local government, however, they are left dependent on donations from individuals or foundations to purchase properties at ever-increasing market prices. The South Bay Community Land Trust’s Perry therefore envisions the organization as part of an ecosystem of community resistance against those forces. 

Money shouldn’t determine whether you have a dignified home. It shouldn’t determine whether you have access to shelter.

The South Bay trust has joined with other groups to lobby for a Community Opportunity to Purchase Act in San José, which would provide municipal funding for nonprofit housing acquisitions. In March, following years of actions against gentrification, including the Google campaign that birthed the land trust, San José’s city council moved forward with an anti-displacement work plan that could eventually include just such an ordinance. 

But those small successes won’t stop the runaway acceleration of housing costs and the forces of speculation helping fuel it. Even in Silicon Valley’s overheated housing market, two 2019 government surveys found 4.4 housing units stood vacant in 2019 for each homeless person in Santa Clara County. NPR affiliate KQED reported that some are owned by shell companies, presumably as investment vehicles. Others remain empty as their owners plan redevelopments to increase their value even further. 

In either case, even property vacancies in the Bay Area are structured by increasing property values pegged to tech workers’ generous salaries. The East Bay cooperative’s Noni Session says that what’s driving up housing prices in the Bay Area isn’t an absence of dwellings, but a continued influx of well-compensated professional workers. 

“Most of the tech companies have ongoing plans to import more and more labor into the urban city,” Session says. “This housing that we’re producing is really marked at the level of a high-salary tech worker.” 

New market-rate units do little to take pressure off of lower-income housing, and instead make the region a more attractive destination for wealthy workers whose demand pushes housing costs higher still. As housing policy analyst and urban geographer Samuel Stein wrote in his 2019 book Capital City: Gentrification and the Real Estate State, “Simply adding housing supply does not necessarily drive down overall prices. In many cases, it does the opposite.” 

“Silicon Valley needs another tech campus like it needs a hole in the head,” Perry says. The campaign against Google’s proposed campus culminated in a city hall protest where Gonzalez, Perry, and six others were arrested as the municipal government voted to sell public land to the tech giant. 

Though the campaign to halt the Google development didn’t succeed, it inspired the creation of Silicon Valley’s first community land trust. It also extracted a commitment from the city government that the project would cause no displacement due to gentrification, and an endorsement of the utilization of community groups to attain that goal. Gonzalez and Perry hope that this will lead to support for the land trust as it begins acquiring its first properties.

When Liz Gonzalez thinks about growing the community land trust model to ensure her friends and family members can keep living in the city that raised them, she emphasizes the “cooperation, collaboration, and education” necessary to scale nonmarket land use models.

Though the South Bay Community Land Trust is still in its early stages, neither Gonzalez nor Perry would be content with the preservation of a few homes if hundreds more are priced out around them. “The whole system of land ownership in the United States is wrong,” Perry says. “Ultimately, it should be abolished.” 

As Gonzalez puts it, “The goal is to decommodify housing because money shouldn’t determine whether you have a dignified home. It shouldn’t determine whether you have access to shelter.”

CORRECTION: This story was updated at 10:42 a.m. Aug. 13, 2021, to replace an out-of-date link to the East Bay Permanent Real Estate Collective’s Cultural Community Corridor Project with the correct link. Read our corrections policy here.