More housing development was permitted last year in Oakland than any since the pandemic began, but the city continues to lag behind on affordable housing production.
A new progress report from the city looks at how much new housing was proposed, permitted, and built in Oakland in 2022. The document also serves as the final analysis of whether the city met the goals in the eight-year housing plan, or Housing Element, adopted in 2014.
Oakland has a brand new Housing Element, laying out how the city plans to meet its state-mandated building targets over the next eight years.
The Oakland Planning Commission will discuss the findings in the progress report on Wednesday, and the City Council will review it in the coming weeks.
In 2022, the city finally saw a return to a pre-pandemic level of construction, according to the report, which tracked building permits issued by the city. These permits give developers permission to start construction on a project and are generally considered a good measure of how much housing is actually getting built. In 2019, 2,163 units (houses and apartments) were permitted, but the following year that number was slashed nearly in half to 1,107.
While the number of permitted units climbed back up to 2,091 in 2022, Oakland isn’t anywhere close to the building boom of 2018, when 4,617 units were permitted. The steep drop between 2018 to 2019 indicates that the pandemic is not the only driver of the construction slowdown.
“New construction starts are waning due to mounting competition among recently-delivered residential projects and challenges associated with the financial feasibility of development,” wrote city consultants in a 2020 report on the Downtown Oakland Specific Plan.
Oakland, like all California cities, is required to plan for a certain number of new homes every eight years. That number, called the Regional Housing Needs Allocation, or RHNA, is set by the state and regional governments. In their Housing Elements, cities identify sites where that housing can be built.
The new progress report shows that Oakland surpassed its total RHNA target for this last eight-year cycle, permitting 18,880 units between 2015 and 2022, above the 14,765-unit goal.
The city achieved this success by overwhelmingly greenlighting market-rate construction. Oakland is still behind on all targets for affordable housing.
In the 2015-2022 RHNA cycle, Oakland was required to plan for 6,949 affordable housing units, with portions priced for residents considered “very low-income,” “low-income,” and “moderate-income.” As the cycle comes to a close, Oakland is still short 4,473 of these affordable units, particularly in the moderate-income category.
“For the eighth year in a row, Oakland’s Housing Element progress report shows that while the city has permitted an abundance of market rate housing, we are not building enough affordable homes,” said Jeff Levin, senior director of policy at East Bay Housing Organizations, which advocates for affordable housing. “The trend in Oakland has been to build high-end units that attract new, higher-income residents, increasing displacement pressure, while failing to address the needs of existing renting families.”
Housing prices in Oakland have left a “staggering” half of all renters in the city “housing burdened,” meaning they pay more than 30% of their income on rent, according to census data cited in the progress report. “Rent burden also follows familiar patterns of racial inequity,” with Black households experiencing the highest rate, the report said. In recent years in Oakland, the Black population has shrunk rapidly, with many families leaving for less expensive cities.
However, 2022 was Oakland’s best year for affordable housing production so far, with the city issuing permits for 653 below-market-rate homes.
“It’s encouraging that housing growth is bouncing back in Oakland, and especially great to see more dedicated affordable housing being built than ever before,” said Aaron Eckhouse, a member of East Bay for Everyone, a group that advocates for more housing development. But “there’s still a lot of unmet housing need in Oakland, as in the Bay Area generally.”
The policies in Oakland’s new Housing Element will encourage more building and equal access to neighborhoods in the city, Eckhouse said.
The pandemic has also brought increased interest in—and resources for—converting existing buildings into affordable housing, or preserving homes in precarious positions. The state’s Homekey program enabled Oakland and nonprofit organizations to buy hotels and dormitories and turn them into supportive housing. The city doles out additional funding for similar conversion projects, too.
While COVID-era programs are drying up, Oakland voters approved an infrastructure bond measure last year that will yield the largest single allocation for affordable housing in the city’s history—$350 million.