Migration Patterns Impact Low-Income Renters

Public Policy, Occidental College, and the University of California, Davis’s Center for Regional Change analyzes intra-state migration from the greater San Francisco Bay Area to the Central Valley region. The authors of the report, “Bay Area to Central Valley Migration and its Impacts,” discuss how, amid a lack of growth in the housing stock that has prevented the accommodation of growing populations, rising prices in the Bay Area have acted as a push factor that has combined with the pull of relatively lower prices in the Central Valley to encourage migration. This dynamic has in turn pushed prices upwards in the receiving areas of the Central Valley, negatively impacting low-income renters who were already suffering from financial burdens.

Between 1990 and 2020, the housing stock in both the Bay Area (San Francisco, Alameda, Santa Clara, San Mateo, and Contra Costa Counties) and the Central Valley (Sacramento, Yolo, El Dorado, Placer, Solano, San Joaquin, Stanislaus, and Merced Counties) increased, but the growth in housing stock did not keep pace with population growth. The Bay Area saw a 23% increase in its housing stock, but a 30% increase in its population. The Central Valley experienced a 47% increase in its housing stock and a 55% increase in its population. The authors also compared job growth to housing growth. The Bay Area, particularly San Francisco and San Mateo Counties, saw significantly higher rates of job growth compared to housing growth, while most counties in the Central Valley saw job growth rates similar or lower than housing growth (except for Sacramento), indicating that communities in the Central Valley are likely functioning as bedroom communities where residents commute to other regions for work.

Neither the Bay Area nor the Central Valley is densifying by adding greater shares of multi-family housing as their populations grow. Between 1990 and 2020, the share of Bay Area housing that was multi-family remained consistent – around 40% – while the share in the Central Valley declined from 25% to 21%. Of the newly built units in the Central Valley, 14% were multi-family. The authors note that little developable land is left in the Bay Area, and the fact that current development patterns are dominated by single-family homes means the Central Valley could also eventually run out of land.

Renters, particularly low-income renters in the Central Valley, have been hit especially hard by rising rents in recent years. Between 2017 and 2022, median rents increased in Central Valley counties by 25% to 44% as the rental supply was significantly underproduced compared to population growth. Rent increases were greater in the Central Valley compared to the Bay Area both pre-COVID and during COVID. Rents in San Francisco, which were the most expensive in 2017, declined by 10% between 2017 and 2022. Other Bay Area counties saw rent increases of 4% to 12%. As low-income renters are displaced by higher rents, they have likely been pushed further away from their support networks, including social services agencies where they are clients. Focus groups conducted for the study also identified another effect of displacement: renters displaced to new areas may not be aware of local policies designed to protect renters, exposing them to higher rates of eviction and substandard or hazardous housing conditions.

The authors suggest that housing subsidies act as both a sprawl deterrent and a diversifier of the housing stock, in addition to providing affordable rents, because subsidized housing is often multifamily. The reality, however, is that the subsidized affordable housing stock is very limited in size.

The full report can be found at: https://bit.ly/3PeJlri