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Inclusionary Housing

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Inclusionary housing is a local policy requiring that market-rate residential developments include  a certain amount of affordable housing. While some inclusionary housing policies are mandatory and others voluntary, the goal of all inclusionary housing programs is to establish a relatively permanent stock of affordable rental or ownership housing.

Inclusionary policies take the form of a local ordinance, a General Plan policy, or a permit approval process that requires or rewards affordable projects.  While the terms “inclusionary housing” and “inclusionary zoning” are often used interchangeably, in fact, not all inclusionary housing practices are zoning requirements. 

In designing effective inclusionary housing programs, the most significant policy considerations are:

  1. The inclusionary percentage-how much is required
  2. Income levels targeted
  3. Alternatives to construction on-site
  4. Developer incentives
  5. Length of affordability

Inclusionary housing or zoning, while not uncontroversial, is increasingly being used as a major tool for addressing the affordable housing shortage in California communities.  In the current market, while affordability has increased for first time homebuyers earning the area median income, there is still a large affordability and availability gap in rental and ownership housing for lower income Californians. 

Over the past 40 years, inclusionary housing has created over 34,000 affordable homes and apartments in California.  California’s housing crisis has serious implications for the future of our state.  The performance of our schools, urban sprawl; transportation gridlock, the strengthening of the California economy, and health care for families and children- are all pressing social issues at the top of the agenda of decision makers and concerned citizens.  The recent foreclosure crisis demonstrates how powerfully affordable housing impacts these very issues.  

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