HUD vs San Francisco

First some positive news.

The average foreclosure rate in the United States is officially at pre-housing bubble levels while medium home prices are now above the height of the bubble. That means home values are the highest they have ever been and foreclosures are back to industry normals. -Yippie! 

With that being said, San Jose has officially become the first city of its size to now have medium home prices exceed $1 million. That means even for a programmer at Google with a base salary of $128k, affordable housing is vastly outpacing supply. 

Compounding this problem, 87% of current renters who want to purchase cannot due to being out priced out of markets available homes.

In a stroke of genius, San Francisco, fast becoming one (if not the) most expensive cities in the US to live in, came up with a plan. From here on out, new housing products must include 40% of the new units to be deemed affordable for the residents who already live in those neighborhoods. Unfortunately this is where the HUD stepped in. 

According to HUD - This could violate Federal Urban Development law and perpetuate racial segregation and disproportionately affect low-income people because you would be living around people like you. While the plan is not perfect, anything that pushes affordable housing allowing more Americans access to build what historically has been the largest single source of wealth building, is positive for us.