The Pandemic Puts Pressure on OC’s Already Struggling Workforce Housing Market

The pandemic has put more pressure on affordable housing crisis in Orange County. Although the market is one of the wealthiest in the nation, it was struggling with a dearth of affordable housing supply prior to the pandemic. Now, with widespread job loss and a shutdown hospitality industry, affordable housing demand is soaring, while supply remains limited. CREW OC recently hosted virtual event Perspectives on Housing Affordability to analyze the local housing crisis.

With the high cost of housing in Orange County, the increase in unemployment created by the pandemic resulted in many who were previously housing insecure falling into homelessness,” Pauline Hale, senior manager of advisory at Altus Group and a board member at CREW OC, tells GlobeSt.com. “This was exacerbated by the county’s high concentration of employment in the hospitality and leisure sector as Disneyland remains shuttered, and hotel occupancies remain at all-time lows.”

While the problem is more severe, the solution is still the same that CRE players have long touted: more development. The affordable housing problem is a critical supply issue. “ Due to high land costs, most of the new supply in Orange County has been in the luxury space, and it is the only sector that is showing signs of weakness in occupancy,” adds Hale. “There is a dearth of availability of mid-priced/workforce housing in the area, and this shortage has resulted in increased rents due to excessive demand.”

In a market like Orange County, however, new development is easier said than done. OC is home to a large NIMBY population that has opposed affordable or workforce housing development. Hale says that education and awareness is the key to getting the community on board. “Often the NIMBY’s rely on untrue rhetoric around the housing situation,” she says. “There are misunderstandings around concepts like workforce housing, not supportive housing, and increasing density, which does not increase traffic. If you can afford to live where you work, there is less inbound traffic in a community.”

The good news is that awareness is spreading in the community. “I think communities are beginning to realize that the housing crisis must be addressed,” says Hale. “Much of the momentum over the coming year will be tied to pandemic recovery timing and election results up and down ballot. For Orange County, reopening of Disneyland and Knotts, and the rest of our world-class tourism industry will be a lynch-pin.”