Low-Income Housing Needs

According to the latest housing figures, 2001 wasn’t too bad a year for Orange County residents. And 2002 might even be better.

The year 2001 was the best year on record for home sales across the nation as interest rates dropped to their lowest level in about 30 years. It was an economic windfall for Orange County homeowners, who, in record numbers, took advantage of the lower rates to decrease their existing monthly mortgage payment. Nearly 140,000 residents refinanced their mortgages, well more than double the number the previous year.

The lower interest rates also enabled some middle-income renters to become home owners because of the more affordable monthly payments. But because new home sales in the county dipped last year, and the housing inventory remained so low, the median home price continued to climb. It hit $332,000 in December--the first time that any Southern California county ended a year above the $300,000 mark.

The good news for some renters is that rent increases haven’t been as sharp and there are more vacancies on the market. Unfortunately, that’s not a countywide condition. The homeless saw a slight improvement with the opening last year of five new shelters that added 117 beds, but it’s still a woefully inadequate inventory.

What does 2002 hold in store? Predictions are that while housing prices still will go up, the increases won’t be as steep as in years past and more affordable housing should be available. The county’s Housing and Community Development Department has a goal of adding at least 1,000 new, affordable rental units to the housing stock in 2002, which is good.

But what’s still so sorely needed is more home construction for low-income buyers to help keep housing costs within the reach of both renters and buyers.