Despite new laws aimed at affordability and billions of dollars invested in homelessness prevention, housing options are scarce for Angelenos who teeter on the poverty line and must decide between staying housed and feeding their families.
According to city planning data, LA is falling far short of its decade-long goal for extremely low-income housing, issuing building permits for just 4.2% of the units it needs.
Developers often avoid building these units because they’re less profitable, said Azeen Khanmalek, executive director of the pro-housing advocacy group Abundant Housing LA.
“On the lowest ends of the income spectrum, the rent that’s coming in is not covering the amount needed to operate and maintain a building,” Khanmalek said.
The city’s true progress on adding extremely low-income units remains hazy. A recent city report revealed growth over the last four years. However, an LA Local review of that report uncovered inaccuracies in the number of building permits listed.
Last year, 690 extremely low-income units were permitted, according to the city’s annual housing progress report. That was a 14% decline from 2022, but this year’s report incorrectly shows nearly 400% growth because it listed 141 units for 2022 instead of the previously reported 801.
After the LA Local asked LA City Planning about the discrepancy, the department confirmed it had made a mistake. A spokesperson said the 2022 figure was miscalculated in the latest report “due to an unknown error.”
But records obtained from the Department of Building and Safety show the actual decline in extremely low-income units could be even steeper.
Who counts as “extremely low-income” in LA?
In Los Angeles County, an “extremely low-income” household is one making less than $36,400 a year for two people, or under $40,950 for a family of three. Most of these households are “severely cost burdened,” meaning they spend more than half their income just on rent and utilities, leaving little for basic necessities like food.
This is the group hardest to serve, because building homes for them is the least profitable option for developers, Shane Phillips, a housing affordability researcher at UCLA, told The LA Local.
How much was LA supposed to build?
In 2021, the city projected it would need 57,989 new extremely low-income units by the end of the decade to meet housing demand.
According to the city’s own planning data, LA issued permits for just 4.2% of that goal so far. Fewer still have actually broken ground or been completed.
The numbers don’t add up
The dip in extremely low-income units since 2022 could be far worse. While the latest city report says 690 extremely low-income units were permitted last year, permit data obtained through a public record request shows only 274.
Those records from the Department of Building and Safety, which issues the building permits, show 100 of those units came from a single project in East Hollywood.
The planning department said the inconsistent numbers are likely because some publicly financed projects are later required to change a portion of their planned units to accommodate even lower income levels.
Very low-income units followed a similar decline. The department said the 2022 figure in this year’s report was also incorrect.
The corrected data show a 75% drop in VLI units permitted over the past four years.
Which neighborhoods got this housing — and which didn’t?
Department of Building and Safety records show East Hollywood and North Hollywood added the most affordable housing overall last year. Westlake and Florence also permitted a relatively high number of affordable units — 286 and 224, respectively.
But almost none of it was for the lowest-income residents: Westlake didn’t add a single extremely low-income unit, and Florence added just one. Most of what these neighborhoods built was moderate- to low-income, which are slightly higher income levels, but still below market rate.
Areas the city itself has identified as having severe “racially concentrated poverty” barely saw any of this housing permitted. Boyle Heights — 93% Latino — added eight moderate-income units, 30 low-income units, one very low-income unit, and just two extremely low-income units.
Why is extremely low-income housing losing ground?
Phillips, the housing affordability researcher at UCLA, said fewer developers are using the city’s Transit Oriented Communities program, which encourages them to include extremely low-income units. Developers may instead be turning to the state density bonus law, which only requires very low- and low-income units.
“You’re not going to get those [extremely low-income units] voluntarily, because they bring in less rent without letting developers build larger projects,” Phillips said.
Another likely reason for the slowdown in extremely low-income units is a delay in local and federal financial assistance.
Measure HHH, which passed in 2016 and helped fund affordable housing, has largely spent its $1.2 billion in bonds. Most of the money raised by Measure ULA, which taxes properties sold for $5.3 million or more to fund 100% affordable housing projects, hasn’t yet been spent.
Khanmalek said federal subsidies can help bridge the gap, but until recently, the Housing Authority of the City of Los Angeles had a supply shortfall of project vouchers and had paused all new applications for rental assistance. Khanmalek also said the Trump administration providing additional aid is unrealistic.
“I don’t think anyone expects the federal government to be pouring a lot more money into expanding housing assistance with the current political climate,” Khanmalek said.
