Home Construction

By Jonathan Lansner and Marilyn Kalfus, Staff Writers
Posted: 06/25/16 – 6:44 PM PDT |

Dave Miller leaves work in his gold GMC Sierra in midafternoon, loaded up with Arizona iced tea and sesame seeds. He tunes the radio to 95.5 FM KLOS, classic rock.

An auto maintenance supervisor in Garden Grove, Miller lives in Moreno Valley. On a bad day — a Friday — the drive home takes three hours.

The roughly 120-mile round-trip commute is a trade-off. Miller and his wife, Gigi, a hairstylist, bought their 2,000-square-foot, four-bedroom house with a three-car garage last year.

The price: $285,000.

“In Orange County, I couldn’t have half of what I have,” said Miller, 49.

Indeed, the Millers paid less than half of Orange County’s latest median home sale price, which hit a record high $651,500 in May, according to data firm CoreLogic. Riverside County’s median was $330,000, and the six-county Southern California region reached $459,500.

The region’s housing crunch is steep, by any economic measure. A database of housing affordability statistics created by The Associated Press shows Southern California’s two main metropolitan regions — Los Angeles/Orange counties and the Inland Empire — consistently rank among the U.S. markets that most stretch the household budgets of both homeowners and renters. Data used census figures through 2014, the latest available.

Among the 40 largest U.S. metro areas, census figures show L.A.-O.C. had the lowest homeownership rate, the most financially stressed owners and the highest percentage of middle-aged households who were renters. The Inland Empire had the most people per rental unit, the highest share of single-family homes rented, and the second-highest level of financially stressed renters.

The problem has been three decades in the making. The region’s population and economic growth has outpaced local willingness to build more housing. For example, for every four jobs created in L.A.-O.C. and the Inland Empire between 2011-2014, only roughly one new housing unit was permitted.

All told, a shortage of housing options has boosted home prices and rents and essentially raised the entrance fee to Southern California living.

Lucy Dunn, a former state housing chief who now heads the Orange County Business Council, is frustrated by the response to the housing shortfall not just regionally, but statewide. Construction is problematic, what Dunn sees as self-inflicted hurdles from unfriendly review processes to quirky environmental laws to unyielding neighbors.

“It’s simple. It’s about the supply,” Dunn says.

Just ask Dave Miller.

Miller, who works for Orange County Vector Control, hits the road at 4 a.m. His morning drive goes more smoothly, though there’s some congestion, even then. His average trip to work takes about one hour and 15 minutes.

Bob Irish, the real estate broker who sold the Millers their house in Sunnymead Ranch, has offices in Orange and Riverside counties. He sees homebuyers getting priced out of both places.

Say an average worker can afford to spend $400,000 on a house, he said. That’s likely to get them only a condo in Orange County.

“Even then, it’s a little one,” he said.

“$400,000 used to get you Corona, then Riverside. Now you have to go out to Moreno Valley to find it,” said Irish, who owns Newport Realty in Newport Beach and Lake Hills Realty in Riverside.

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