Among the new tweaks, future rowhouse projects built in Mountain View would be encouraged to include below-market housing priced for home buyers earning up to 50% over the median income for Santa Clara County. By including higher earners, elected leaders pointed out they would be helping many middle-class families who earn decent salaries but are still unable to afford the mortgage on a home.
City officials said they would seek to stagger the below-market-rate housing for future rowhouse developments, including a variety of income level qualifications. On average, housing will target households earning 120% of the median income.
"The affordability gap has increased so much that we have to do this to help more people get into ownership units," said Councilwoman Margaret Abe-Koga. "In North Bayshore or East Whisman, we're talking about micro-units and one-bedroom studios, and it's skewing the demographics of our community."
Under the new rules discussed by the council, future rowhouse projects would be required to set aside at least 20% of their units as below-market-rate housing. Even with that obligation, city staff said that rowhouse projects in Mountain View would remain quite profitable — a single home can fetch about $1.65 million in the current market, according to a city-commissioned study. Overall, rowhouse developers are expected to see about a 25% profit margin even though one out of five homes in any future project would be subsidized, the study said.
The stricter affordable housing requirements come as the city has faced withering criticism in recent months for allowing a series of rent-controlled apartments to be torn down in order to build a smaller number of rowhouses. That issue didn't come up at the May 14 meeting, but council members have highlighted it as part of their goal-setting session.
Under the city's newly proposed guidelines, other forms of ownership housing, such as condominiums, would also be subject to higher affordable housing requirements. Those developers would be required to set aside 15% of their units as below market rate, up from 10%. That requirement now matches affordable housing rules for rental housing.
The higher affordable housing standards were just one of several updates endorsed by the City Council. Council members also backed plans to expand the timeframe that projects are required to maintain below-market housing. From now on, Mountain View should seek to have subsidized housing remain locked at a lower price in perpetuity. In the past, the city has typically required a 55-year commitment.
The City Council will consider approving a final version of the new below-market-rate guidelines at its June 18 meeting.
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