Examining the Costs and Impacts
of Housing and Transportation
on Bay Area Residents, Their
Neighborhoods, and the Environment
Bay Area Burden
Terwilliger Center for Workforce Housing
Bay Area Burden
Examining the Costs and Impacts
of Housing and Transportation
on Bay Area Residents, Their
Neighborhoods, and the Environment
Terwilliger Center for Workforce Housing
ii
J. Ronald Terwilliger, Chairman
Trammell Crow Residential, Chairman
Carin Barth
LB Capital, Inc., President
Tom Bozzuto
The Bozzuto Group, CEO
Henry Cisneros
CityView, Executive Chairman;
U. S. Department of Housing and Urban Development,
Former Secretary
Bart Harvey
Enterprise Community Partners, Former Chairman
Bruce Katz
Brookings Institute, Metropolitan Policy Program,
Vice President and Director
Bob Larson
Lazard Real Estate Partners, LLC, Chairman
Rick Lazio
JP Morgan Asset Management, Managing Director of
Global Real Estate and Infrastructure
Steve Preston
OAKLEAF Waste Management, President;
U. S. Department of Housing and Urban Development,
Former Secretary
Jonathan Reckford
Habitat for Humanity International, CEO
Nic Retsinas
Joint Center for Housing Studies of Harvard University, Director
Rick Rosan
ULI Foundation, President
Ronnie Rosenfeld
Federal Housing Finance Board, Former Chairman
Alan Wiener
Wachovia Securities, Managing Director
Pam Patenaude
ULI Terwilliger Center for Workforce Housing,
Executive Vice President and Executive Director
Copyright 2009 by Urban Land Institute
1025 Thomas Jefferson Street, NW
Suite 500 West, Washington, D. C. 20007
National Advisory Board
Terwilliger Center for Workforce Housing
n www. bayareaburden. org
iii
About the Urban Land Institute
The Urban Land Institute is a 501( c)( 3) nonprofit research and education organization supported by its members. Founded
in 1936, the Institute now has more than 32,000 members worldwide representing the entire spectrum of land use and real
estate development disciplines, working in private enterprise and public service. As the preeminent, multidisciplinary real
estate forum, ULI facilitates the open exchange of ideas, information, and experience among local, national, and
international industry leaders and policy makers dedicated to creating better places.
The mission of the Urban Land Institute is to provide leadership in the responsible use of land and in creating and sustaining
thriving communities worldwide. Members regard ULI as a trusted idea place where leaders come to grow professionally
and personally through sharing, mentoring, and problem solving. With pride, ULI members commit to the best in land use
policy and practice.
About the ULI Terwilliger Center for Workforce Housing
The ULI Terwilliger Center for Workforce Housing was established by J. Ronald Terwilliger, chairman and CEO of Trammell
Crow Residential, to expand housing opportunities for working families. The mission of the Center is to serve as a catalyst in
increasing the availability of workforce housing in high- cost communities by harnessing the power of the private sector.
The Center supports the development of mixed- income communities close to employment centers and transportation hubs.
Through a multifaceted approach, the Center facilitates research, advocates for public policy change, publishes best prac-tices,
convenes housing experts, and works to eliminate regulatory barriers to the production of workforce housing.
Acknowledgments
This report was prepared by the ULI Terwilliger Center for Workforce Housing and the Center for Housing Policy, based on
research conducted by the Center for Neighborhood Technology. Through the generous support of ULI Trustee James J.
Curtis, III, the ULI Terwilliger Center for Workforce Housing is working with the ULI Curtis Regional Infrastructure Initiative to
examine how the intersection of land use, housing and transportation can foster the creation of sustainable communities.
www. bayareaburden. org n
“ When it comes to development— housing, transportation,
energy efficiency— these things aren’t mutually exclusive;
they go hand in hand. And that means making sure that
affordable housing exists in close proximity to jobs and
transportation. That means encouraging shorter travel
times and lower travel costs. It means safer, greener,
more livable communities.”
— President Barack Obama, July 13, 2009
1
Bay Area Burden provides a comprehensive analysis of the “ cost
of place” in nine counties located throughout the San Francisco
region by examining the costs and impacts of housing and
transportation on Bay Area residents, their neighborhoods, and
the environment.
The Impacts of High Housing and Transportation Costs
Bay Area households
spend an average of more
than $ 28,000 annually on
housing— about 39 percent
of the area median income.
In addition to the high
cost of housing, Bay Area
households spend nearly
$ 13,400 annually on transportation. Combined, this cost bur-den
of $ 41,420 per year represents 59 percent of the median
household income in the Bay Area. The high combined costs
of housing and transportation leave many Bay Area households
with insufficient remaining income to comfortably meet their ba-sic
needs. This underscores the importance of broadening our
understanding of housing affordability to consider the combined
costs of housing and transportation, as well as the impacts of
longer commutes on the environment and quality of life.
Importance of Location Efficiency
This report exposes the complexity of the interaction of hous-ing
and transportation choices as well as expenditures, and the
unintended consequences on the natural environment when
they work at cross purposes. The report also highlights the
importance of “ location
efficiency”— the proximity
of housing to transporta-tion
hubs, employment, and
retail centers— as a driver
of both affordability and
environmental sustainability.
Aligning Land Use, Housing, and Transportati on Poli cies
Land use decisions play a critical role in determining the avail-ability
of housing that is affordable to Bay Area working families
in locations that are near employment centers and transit. By
strengthening the coordination of land use, housing, and trans-portation
policies, Bay Area jurisdictions could create, preserve,
and expand communities that are both environmentally sustain-able
and affordable to Bay Area households.
Executive Summary
Average Annual
Housing Costs
$ 28,045
% of Income
39%
Average Annual
Transportation Costs
$ 13,375
% of Income
20%
Average Annual Housing
+ Transportation Costs
$ 41,420
% of Income
59%
Housing Plus Transportation Costs in the Bay Area
+ =
www. bayareaburden. org n
2
Housing costs in the Bay Area are among the highest
in the country, ranking number one in median home
value, median monthly costs for homes with a mort-gage,
and median gross rent ( Table 1).
Despite a relatively high median income of $ 72,630—
in comparison to the national median of just over
$ 50,0001— housing in the Bay Area remains generally unaf-fordable.
While about one- fourth
of renters spend more than half
of their incomes on housing in
both the Bay Area and nationally,
a substantially larger share of Bay
Area owners ( 20 percent) spend
more than half their income on
housing than is true for the U. S.
overall ( 12 percent). 2
Jurisdictions throughout the
Bay Area have had difficulty
permitting and building a sufficient number of housing
units to meet demand. The total number of permitted
units affordable to low- and moderate- income house-holds
in the Bay Area between 1999 and 2006 met only
47 percent of the target for such housing set forth
in the regional plan. As shown in Table 2, rates of per-mitted
housing ( relative to goals) were particularly low
for households
with very low
incomes
( 44 percent)
and moderate
incomes
( 37 percent).
Housing Costs
Rank M edian Home Value
1 San Jose— San Francisco— Oakland, CA $ 694,700
2 Salinas, CA $ 658,700
3 Santa Barbara— Santa Maria— Goleta, CA $ 641,800
4 San Luis Obispo— Paso Robles, CA $ 578,900
5 Honolulu, HI $ 574,400
R ank M edian Monthly Costs for Homes with a Mortgage
1 San Jose— San Francisco— Oakland, CA $ 2,803
2 Santa Barbara— Santa Maria— Goleta, CA $ 2,471
3 Salinas, CA $ 2,438
4 New York— Newark— Bridgeport, NY­—
NJ-— CT— PA $ 2,432
5 San Diego- Carlsbad- San Marcos, CA $ 2,412
R ank M edian Gross Rent
1 San Jose— San Francisco— Oakland, CA $ 1,221
2 Honolulu, HI $ 1,206
3 Santa Barbara— Santa Maria— Goleta, CA $ 1,205
4 San Diego— Carlsbad— San Marcos, CA $ 1,168
5 Los Angeles— Long Beach— Riverside, CA $ 1,099
Source: 2007 American Community Survey.
The Bay Area Consistently Tops the Charts in Housing Costs
Table 2 ]
Table 1 ]
Source: Association of Bay Area Governments. 2007. A Place to Call Home.
San Francisco Above
& Select Inner Very Low Low M oderate M oderate Total
East Bay Cities ( 0- 50% AMI) ( 51- 80% AMI) ( 81- 120% AMI) (> 120% AMI)
Berkeley 68% 171% 30% 167% 107%
Fremont 33% 22% 19% 67% 44%
Hayward 6% 5% 98% 167% 92%
Oakland 27% 71% 8% 267% 107%
San Francisco 80% 52% 12% 156% 86%
Total Bay Area 44% 75% 37% 153% 92%
Percent of Regional Housing Needs Assessment Goals
Successfully Permitted, 1999— 2006
Bay Area Meets only 37 Percent of
the Demand for Housing Affordable
to Moderate- Income Households [
n www. bayareaburden. org
3
© 2009 Center for Neighborhood Technology
0 10
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20
SSSSSSSaaaaaaannnnnnn FFFFFFFrrrrrrrraaaaaaannnnnnnccccccciiiiiiiissssssscccccccooooooo CCCCCCCooooooo........ San Francisco Co.
Average Monthly Housing Costs
Less than $ 1,600
$ 1,600 to $ 2,000
$ 2,000 to $ 2,400
$ 2,400 to $ 3,000
$ 3,000 and Greater
Insufficient Data
Highways
Solano Co.
Alameda Co.
Contra Costa Co.
Santa Clara Co.
San Mateo Co.
Napa Co.
Marin Co.
Sonoma Co.
Most Housing Affordable to
Working Families Is Located in the
North Bay and the Inner East Bay. [
lN
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S
0 10
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20
580
880
680
280
101
101
80 Three- fifths of all Bay Area
residents live in communi-ties
that are unaffordable
to households earning less
than $ 80,000. Large cities
located along the Highway 880
corridor— principally along the
eastern and southern shore-line
in Oakland, San Leandro,
Fremont, and low- cost parts
of San Jose— remain rela-tively
affordable. In addition,
northern Sonoma and Napa
counties and eastern Solano
County contain areas with
below- average housing costs,
but households living in these
areas must travel farther to
reach regional employment
centers and public transit.
0 10
miles
20
SanSSSSSSS aaFaaaaannnnnnrn a FFFFFFFnrrrrrrrraaaaaaacnnnnnnniccccsccciiiiiiiicsssssssccccccoccooooooo C CCCCCCCoooooooo.........
Average Monthly
Housing + Transportation Costs
Less than $ 2,600
$ 2,600 to $ 3,100
$ 3,100 to $ 3,600
$ 3,600 to $ 4,200
$ 4,200 and greater
Insufficient Data
Highways
Fixed Rail
Santa Clara Co.
San Mateo Co.
Alameda Co.
Contra Costa Co.
Solano Co.
Napa Co.
Sonoma Co.
Marin Co.
[
4
On an average weekday, the Bay
Area transit system serves nearly
10 percent of the Bay Area work-force,
ranking it among the most
transit- reliant metropolitan areas
in the country ( Table 4).
As with housing costs, the
combined costs of housing plus
transportation are lowest in the
areas around the Bay where many
of the region’s jobs are located
and public transit
has the greatest
reach. These areas
provide the best
opportunities for
working house-holds
to save on
their combined
housing and transportation costs.
Bay Area households seeking
more affordable housing in the
outlying parts of Sonoma, Solano,
Napa, and Contra Costa counties
are burdened with higher trans-portation
costs associated with
these low- density, non- transit-accessible
neighborhoods. These
communities appear less afford-able
when the combined costs
of housing and transportation are
considered.
Housing +
Transportation Costs lN
W E
S
© 2009 Center for Neighborhood Technology
Combined Costs Highlight
the Location Efficiency of
the Largest Cities
0 10
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20
580
680
280
101
101
80
880
n www. bayareaburden. org
5
Environmental Impact
Table 4 ] Nearly One in Ten Bay Area Workers Use Public Transit
S hare of Workers Using
Rank M etro Area P ublic Transit
1 New York— Newark— Bridgeport 26.5%
2 Washington— Baltimore— Northern Virginia 11.1%
3 Chicago— Naperville— Michigan City 11.0%
4 San Jose— San Francisco— Oakland 9.5%
5 Atlantic City, NJ 8.6%
The United States ranks among
the top producers of greenhouse
gas ( GHG) emissions in the world,
and due to the historic rise in the
amount of car travel in the U. S.,
the transportation sector is the
segment of the economy where
GHG emissions have recently in-creased
the most. The successful
implementation of GHG emission
reduction plans in the transporta-tion
sector is particularly important
in the Bay Area, where transporta-tion
accounts for 40.6 percent of
greenhouse gas emissions, 4 com-pared
to 33 percent nationally. 5
With the successful passage of
California’s Senate Bill 375— leg-islation
that requires metropolitan
planning organizations to develop
housing and transportation plans
to lower GHG emissions— Cali-fornia
emerged as a worldwide
leader in seeking strategies to
reduce GHG emissions.
A recent ULI study, Growing
Cooler, found that the number of
“ vehicle miles traveled” ( VMT)— a
measure of car usage— in com-pact
urban areas with a mix of
housing types, access to reliable
transit to/ from employment cen-ters,
and services within walking
distance, can be 20 to 40 percent
lower than in auto- dependent
suburbs.
As Table 3 illustrates, densely
developed urban counties like San
Francisco are estimated to have
substantially fewer vehicle miles
traveled per household ( 19.4) and
thus lower per- household carbon
dioxide emissions ( 20.2) than do
more rural and suburban coun-ties,
where these measures can
exceed the Bay Area average by a
wide margin.
Of significant importance is
the fact that compact land use
patterns facilitate lower per- capita
GHG levels in both transportation
and building sectors. Multifamily
units in an urban setting are often
smaller and more thermally ef-ficient
than single- family detached
homes at the urban edge, reduc-ing
energy consumption associat-ed
with heating and cooling by up
to 50 percent on a per- household
basis. 6 Depending on the source
of electricity generation for a
given metropolitan area, this can
yield a comparable reduction in
GHG emissions.
Distribution of Households A verage Weekday Daily,
by Land Use Pattern per Household
CO2
County Name U rban S uburban R ural VMT ( Pounds)
San Francisco 97% 2% 1% 19.4 20.2
Alameda 47% 51% 4% 33.1 30.8
Santa Clara 34% 61% 5% 35.9 34.4
San Mateo 35% 59% 6% 40.3 36.5
Contra Costa 11% 74% 15% 43.8 42.9
Marin 0% 85% 15% 35.9 35.0
Solano 3% 76% 20% 50.4 49.4
Napa 3% 60% 37% 42.3 42.5
Sonoma 4% 56% 40% 50.1 51.0
Bay Area 36% 54% 10% 36.6 35.4
Vehicle Miles Traveled and Emissions per Household
Are Associated with Land Use Patterns ( 2006)
Table 3 ]
Note: Table sorted in ascending order by percent rural.
Source: Brazil, H. M., and C. L. Purvis 2009, July. Basteg ( Bay Area Simplified Simulation of Travel, Energy
and Greenhouse Gases): Sketch Planning Charrette/ GIS Models for Predicting Household Vehicle Miles of
Travel ( VMT) and Greenhouse Gas ( CO2) Emissions. Oakland, CA: Metropolitan Transportation Commission.
www. bayareaburden. org n
Source: 2007 American Community Survey.
6
Households in the Bay Area spend an
average of $ 28,045 per year on hous-ing
and $ 13,375 on transportation. As
expected, housing costs are highest in
the counties with the highest incomes:
Marin, San Mateo, Santa Clara, and
Contra Costa. These counties also have
mid- to- high transportation costs. As a
percentage of income, these combined
costs roughly approximate the regional
cost burden of 59 percent, with the
exception of Santa Clara.
In Napa, Sonoma, and Solano coun-ties
to the north, housing costs are
below the regional average, but higher
transportation costs result in combined
costs, as a percent of income, of 61
percent to 66 percent— above the Bay
Housing + Transportation Costs
for Bay Area Counties
Average H+ T Costs $ 41,420 $ 48,239 $ 46,212 $ 44,371 $ 43,428 $ 41,240 Average Median Income $ 75,103 $ 84,028 $ 82,262 $ 85,314 $ 78,468 $ 66,709 Average H+ T as % 59% 60% 58% 54% 59% 64% of Median Income
Nine- County Bay Area Marin San Mateo Santa Clara Contra Costa Napa 0
$ 10,000
$ 20,000
$ 30,000
$ 40,000
$ 50,000
$ 28,045
$ 34,405
$ 32,693 $ 30,261 $ 28,781 $ 26,898
A Nine- County
Perspective: Interplay
between Median
Incomes and Housing +
Transportation Costs
$ 13,375
$ 13,834 $ 13,518
$ 14,110 $ 14,646
$ 14,342
n www. bayareaburden. org
Rental Housing Lowers Overall
Housing Costs in San Francisco County
Although San Francisco County is often associated
with high housing costs, the data presented in this
report suggest that housing is more affordable there
than in five other counties in the Bay Area. Since 62
percent of San Franciscans rent their homes, the av-erage
housing costs in San Francisco are below the
Bay Area average. In comparison, only 37 percent of
households in the rest of the Bay Area are renters.
Even though rents in San Francisco are high, renting
is less expensive than owning a home, and the large
number of renters in the county keeps average hous-ing
costs lower than the Bay Area average.
7
Area average. In a pattern consistent with
the “ drive until you qualify” phenomenon
common to many metropolitan areas,
Solano County has both the lowest hous-ing
costs and the highest transportation
costs in the Bay Area.
Despite having higher housing costs
than two of the counties to the north,
combined costs for housing and transpor-tation
are lowest in absolute dollar terms
in Alameda and San Francisco counties,
which can be attributed in part to their
“ location efficiency” ( i. e., their proxim-ity
to job clusters and public transit) and
consequently low transportation costs.
Average annual transportation costs in
San Francisco are nearly $ 3,900 below
the regional average.
$ 39,245 $ 38,342 $ 37,899 $ 35,995
$ 62,348 $ 65,291 $ 68,985 $ 66,523
66% 61% 61% 58%
Sonoma Solano Alameda San Francisco
Transportation
Housing
$ 14,503 $ 14,914 $ 12,973 $ 9,501
$ 24,742 $ 23,429 $ 24,926 $ 26,494
© 2009 Center for Neighborhood Technology
www. bayareaburden. org n
8
0
$ 20,000
$ 40,000
$ 60,000
$ 80,000
$ 100,000
$ 120,000
0
75%
50%
25%
100%
0
$ 20,000
$ 40,000
$ 60,000
$ 80,000
$ 100,000
$ 120,000
100%
75%
50%
25%
0
Housing +
Transportation Costs
for Bay Area Cities
San Mateo County S anta Clara County S Alameda County C ontra Costa County M Median Income $ 43,715 $ 74,908 $ 69,716 $ 181,730 $ 75,856 $ 187,378 $ 105,660 $ 75,920 $ 82,707 $ 76,495 Costs
Costs
Berkeley Oakland Emeryville Fremont Piedmont San Pablo Richmond Antioch Concord Orinda East Palo Alto San Mateo Daly City Hillsborough Redwood City Los Altos Hills Palo Alto San Jose Sunnyvale Santa Clara Median Income $ 54,435 $ 51,045 $ 51,531 $ 87,425 $ 157,845 $ 42,660 $ 50,172 $ 67,740 $ 64,048 $ 133,108 $ 34,388 $ 31,613 $ 30,000
$ 43,087
$ 75,758
$ 32,725 $ 33,869
$ 41,153 $ 37,356
$ 62,798
77%
69%
59%
50% 49%
81%
73%
63% 60%
49%
$ 32,366
$ 43,516 $ 40,127
$ 103,135
$ 41,471
$ 94,715
$ 48,346
$ 41,956
$ 37,191 $ 35,847
75%
60% 58% 57% 57% 51% 47%
58%
46% 48%
Cost
Burden
Cost
Burden
Cost Costs
Burden
Median Income
Transportation
Costs
Housing
Costs
% of Median
Income Spent
on Housing
% of Median
Income Spent on
Transportation
n www. bayareaburden. org
9
olano County S onoma County
arin County N apa County
In most cases, the average combined
costs of housing and transportation are
lower in a county’s largest cities relative to
the county as a whole or to smaller munici-palities
in the same county. For example, in
Alameda County, the combined costs are
far lower in larger cities like Oakland and
Berkeley than in a small town like Pied-mont
with fewer than 4,000 households
( see chart).
However, costs that appear relatively af-fordable
may nevertheless consume a large
fraction of the residents’ incomes. For ex-ample,
the combined housing and transpor-tation
costs in Berkeley ($ 34,388) are less
than half of the costs in Piedmont ($ 75,758).
But because median income in Piedmont
exceeds $ 150,000, housing and transpor-tation
costs consume only 49 percent of
household income, compared to 77 percent
for the typical household in Berkeley.
$ 47,339 $ 58,205 $ 57,429 $ 77,144 $ 66,990 $ 43,411 $ 57,120 $ 55,940 $ 64,511 $ 74,506
Novato San Rafael Mill Valley Ross Sausalito American Canyon Yountville Calistoga St. Helena Napa
Rio Vista Vallejo Fairfield Benicia Vacaville Cloverdale Rohnert Park Santa Rosa Petaluma Windsor
$ 74,991 $ 70,960 $ 96,726 $ 105,788 $ 93,311 $ 56,051 $ 55,724 $ 50,611 $ 73,336 $ 60,982
With average combined costs
of housing and transportation
consuming over 70 percent of
their income, residents of cities
such as Berkeley, San Pablo,
Richmond, and East Palo Alto
are left with little income
for food, child- care, and other
daily necessities.
$ 45,052 $ 41,241
$ 53,457
$ 86,926
$ 47,391
$ 42,315 $ 41,262
$ 35,167
$ 46,270
$ 36,634
61% 61% 56%
82%
51%
83% 79%
71% 66% 62%
$ 33,928 $ 35,599 $ 35,075
$ 43,218
$ 37,270
$ 31,615 $ 35,867 $ 35,129 $ 39,435 $ 43,044
72%
64% 63% 58% 58%
74%
66% 66% 63% 62%
© 2009 Center for Neighborhood Technology
www. bayareaburden. org n
10
A Bay Area Working
Family’s Budget
A Solano County Family
A Solano County firefighter and a
waitress with one preschool- age
child together earn an estimated
$ 61,034 annually*— 84 percent of
the Bay Area median income. Af-ter
taxes,** their monthly income
is approximately $ 4,282.
Average housing and trans-portation
costs in Solano County
consume about 63 percent of
this family’s gross income, which
leaves only $ 1,087 per month to
cover other household expenses:
$ 4,282
Housing –$ 1,952
Transportation –$ 1,243
What’s left $ 1,087
This family of three in Solano
County can expect to incur the
following basic expenditures:
Child- care –$ 713
Food –$ 592
Health care –$ 315
Miscellaneous –$ 321
At month’s end –$ 854
Spending 63 percent of their in-come
on housing and transporta-tion,
this Solano County house-hold
is $ 854 short of covering
even their basic essentials like
food and healthcare.
* Average salaries for these professions in the
Vallejo- Fairfield Metropolitan Statistical Area ac-cording
to salary. com, as reported in the Center for
Housing Policy’s Paycheck to Paycheck 2009.
** Tax estimates and monthly expenditures with the
exception of housing and transportation are based
on The Self- Sufficiency Standard for Solano County,
CA 2008, produced by Insight Center for Community
Economic Development.
A Santa Clara County Family
A physical therapist with one
infant and one elementary school-age
child earns an estimated
$ 85,125 annually*— 117 percent
of the Bay Area median income.
After taxes,** monthly income is
approximately $ 5,405.
Average housing and transpor-tation
costs in Santa Clara County
consume about 52 percent of
this family’s gross income, which
leaves $ 1,707 per month to cover
other household expenses:
$ 5,405
Housing –$ 2,522
Transportation –$ 1,176
What’s left $ 1,707
A family of three in Santa Clara
County can expect to incur the
following basic expenditures:
Child- care –$ 1,388
Food –$ 669
Health care –$ 276
Miscellaneous –$ 389
At month’s end –$ 1,015
Spending 52 percent of their
income on housing and transpor-tation,
this Santa Clara household
is about $ 1,015 short of covering
even the essentials like childcare
and food.
* Average salaries for these professions in the San
Jose– Sunnyvale– Santa Clara Metropolitan Statistical
Area according to salary. com, as reported in the Center
for Housing Policy’s Paycheck to Paycheck 2009.
** Tax estimates and monthly expenditures with the
exception of housing and transportation are based on
The Self- Sufficiency Standard for Santa Clara County,
CA 2008, produced by Insight Center for Community
Economic Development.
Reductions in Combined Housing and
Transportation Costs are Essential to Help
Working Families Meet Their Basic Needs.
n www. bayareaburden. org
[
For purposes of this report, the
Bay Area has been divided into seven
regions— North Bay, San Francisco,
Peninsula, Inner East Bay, Outer East
Bay, Silicon Valley, and South Bay—
based on physical geography, develop-ment
patterns, and socioeconomic
characteristics. 7 The seven regions
broadly group together communi-ties
that share similar attributes. For
example, dense urban communities
like Oakland and Berkeley have more
in common with one another than they
do with Pleasanton, but all three are lo-cated
in Alameda County. Rather than
look at Alameda County as a whole,
this section splits the county into the
Inner East Bay and the Outer East Bay.
As Table 5 suggests, San Francisco
stands out as a particularly location-efficient
region, based in large part on
its access to public transit, its walk-able
communities, and its concentra-tion
of jobs. 8 Transportation costs
are highest in the Outer East Bay,
North Bay, and South Bay. In these
regions, the typical household must
drive farther and more frequently
to reach employment centers and
services. In addition to the adverse
© 2009 Center for Neighborhood Technology
11
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20 SSSSSSSaaaaaaannnnnnn FFFFFFFrrrrrrrraaaaaaannnnnnnccccccciiiiiiiissssssscccccccooooooo CCCCCCCooooooo........ San Francisco Co.
North Bay
San Francisco
Peninsula
Inner East Bay
Outer East Bay
Silicon Valley
South Bay
Fixed Rail
Altamont Commuter Rail
Amtrak
BART
Caltrain
MUNI
VTA
Santa Clara Co.
Alameda Co.
San Mateo Co.
Contra Costa Co.
Solano Co.
Marin Co.
Sonoma Co.
Napa Co.
Santa Rosa
Vallejo
Concord
Oakland
Hayward
Fremont
Sunnyvale
Santa Clara
San Jose
The Regional Perspective:
Transportation Costs
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Transportation Costs are Significantly Lower in
Transit- Accessible, Job- Rich Regions Along the Bay
Table 5 ]
Monthly % of Bay Area
Region Includes Transportation Costs* Median Income
San Francisco San Francisco City/ County $ 819 13.5%
Inner East Bay Coastal Portions of $ 1,113 18.4%
Alameda, Contra Costa,
and Solano counties
Peninsula San Mateo County $ 1,122 18.5%
Silicon Valley Northern Part of $ 1,125 18.6%
Santa Clara Valley
Outer East Bay Eastern Portions of Alameda $ 1,238 20.5%
and Contra Costa counties
North Bay Four Northernmost counties $ 1,262 20.9%
of Marin, Napa, Solano,
and Sonoma
South Bay Outlying Portion of $ 1,317 21.8%
Santa Clara County
* This Table shows estimated transportation costs for a household with the Bay Area median income.
Source: Center for Neighborhood Technology Calculations.
environmental impacts of extensive
driving and the “ time tax” associated
with long- distance commutes and
traffic congestion, this level of auto
dependence can strain a household
budget. Transportation costs in these
regions consume an estimated 20 to
22 percent of the monthly income of
a median- income household, which
can add $ 5,000 to $ 6,000 to the an-nual
transportation bill compared to a
household living in San Francisco.
0 10
miles
20
0 10
miles
20 SSSSSSSaaaaaaannnnnnn FFFFFFFrrrrrrrraaaaaaannnnnnnccccccciiiiiiiissssssscccccccooooooo CCCCCCCooooooo........ San Francisco Co.
North Bay
San Francisco
Peninsula
Inner East Bay
Outer East Bay
Silicon Valley
South Bay
Fixed Rail
Altamont Commuter Rail
Amtrak
BART
Caltrain
MUNI
VTA
Santa Alameda Co.
San Mateo Co.
Contra Costa Co.
Solano Co.
Marin Co.
Sonoma Co.
Napa Co.
Santa Rosa
Vallejo
Concord
Oakland
Hayward
Fremont
Sunnyvale
Santa Clara
San Jose
www. bayareaburden. org n
12
On average, a household in the
Bay Area spends $ 41,420 annually
on the combined costs of housing
and transportation, which is roughly
59 percent of the typical Bay Area
household’s income. Within the Bay
Area, these costs, as well as the
incomes of the households who pay
them, vary substantially from region
to region. At one end of the spec-trum
is the South Bay, where com-bined
costs are more than one- third
higher than the Bay Area average,
with housing costs alone exceeding
$ 40,000. South Bay incomes, too,
are exceptionally high, helping resi-
The Regional Perspective:
Housing + Transportation Costs
Regional Variations
in Combined Costs
and Incomes Are
Significant.
Nine- County Bay Area South Bay Peninsula Outer East Bay Silicon Valley North Bay Transportation
Housing
0
$ 10,000
$ 20,000
$ 30,000
$ 40,000
$ 50,000
$ 60,000
$ 13,518 $ 15,056 $ 13,942
$ 14,478
$ 13,375
$ 28,045
$ 32,693
$ 30,678 $ 29,638 $ 27,191 $ 16,809
$ 40,262
Average H+ T Costs $ 41,420 $ 57,071 $ 46,212 $ 45,735 $ 43,581 $ 41,669 Average Median Income $ 75,103 $ 99,107 $ 82,262 $ 87,511 $ 84,456 $ 69,360 Average H+ T as % 59% 61% 58% 55% 54% 63% of Median Income
n www. bayareaburden. org
13
dents to offset the higher costs.
San Francisco and Inner East Bay
are the only regions with average
combined costs below the nine-county
Bay Area average. In San
Francisco, access to public transit,
employment centers, and a very low
rate of auto ownership help produce
Inner East Bay San Francisco
the lowest transportation costs,
equivalent to a savings of more
than $ 7,300 each year compared
to the South Bay. In the Inner East
Bay, transportation costs are the
second lowest among the seven
regions, and housing costs are the
least expensive. Despite these low
costs, Inner East Bay households,
on average, spend 63 percent of
their income on these combined
expenses as a result of their com-parably
low incomes.
Tied with the Inner East Bay for
the highest combined cost burden,
North Bay households also spend
63 percent of their income on hous-ing
and transportation. Housing
costs in the North Bay are compara-tively
affordable, but the savings are
offset by high transportation costs.
As a result, the North Bay is the
only region with combined costs
above the Bay Area average and an
average median household income
below the Bay Area’s.
$ 12,858 $ 9,501
$ 23,624 $ 26,494
$ 36,482 $ 35,995
$ 62,992 $ 66,523
63% 58%
© 2009 Center for Neighborhood Technology
www. bayareaburden. org n
On average, a household in the Bay Area spends $ 41,420
annually on the combined costs of housing and transportation,
roughly 59% of the typical Bay Area household’s income. [
14
One- fourth of all households in
the Bay Area live in neighborhoods
where housing and transportation
costs account for 65 percent or
more of income— a level this report
defines as an “ extreme housing
and transportation cost burden.”
As shown in Table 6, in most
regions, the typical incomes of
neighborhoods with extreme hous-ing
and transportation cost burdens
fall between $ 39,000 and $ 53,000,
suggesting that such burdens
primarily affect low- to moderate-income
households. The Peninsula
and South Bay are outliers, where
the average median incomes of
households within burdened neigh-borhoods
are $ 61,290 and $ 75,692,
respectively.
In the Inner East Bay, North Bay,
and South Bay, more than one- third
of all households have extreme
housing and transportation cost
burdens. 9 In absolute dollar terms,
housing and
transportation
costs in the
Inner East Bay
are relatively low
in comparison
to those of the
The Regional Perspective:
Housing + Transportation Cost Burdens
costs are due at least in part to the
fact that the area is well served
by mass transit, and many people
work in the region. Incomes,
however, are also below
average, and neighborhoods
with extreme housing and
transportation cost burdens
have an average median
household income of less
Source: Center for Neighborhood Technology Calculations.
Many Neighborhoods with Extreme H+ T Cost Burdens
Are Located in the Inner East Bay and the North Bay
Table 6 ]
than $ 40,000— barely half of the
Bay Area median. Extreme cost bur-dens
in these neighborhoods are
more a function of the residents’
low incomes than of their housing
and transportation costs.
Although the North Bay exhib-its
a comparable percentage of
neighborhoods with extreme cost
burdens, similarities with the Inner [ Combined Costs as a Percent of
Income Exceed 65 Percent in Many
Neighborhoods throughout the Bay Area.
Inner East Bay 196,344 34% $ 1,595 $ 936 $ 39,786
North Bay 143,454 34% $ 2,010 $ 1,106 $ 50,673
Silicon Valley 83,852 15% $ 2,191 $ 1,090 $ 52,635
San Francisco 80,028 25% $ 2,139 $ 751 $ 45,969
Peninsula 47,391 19% $ 2,661 $ 1,071 $ 61,290
Outer East Bay 45,798 13% $ 1,748 $ 1,091 $ 44,756
South Bay 11,870 35% $ 3,219 $ 1,269 $ 75,692
Nine- County Bay Area 608,736 24%
other regions, and both expen-ditures
fall below the Bay Area
average. The low transportation
Region
Households in
Neighborhoods
Where
H+ T Costs >=
65% of Income
% of Region’s
Total Households
Average Housing
Costs in These
Neighborhoods
Average
Transportation
Costs in These
Neighborhoods
Average Median
Household
Income
n www. bayareaburden. org
15
0 10
miles
20
SSSSSSSSaaaaaaaannnnnnnn F FFFFFFFrrrrrrrrraaaaaaaannnnnnnncccccccciiiiiiiiissssssssccccccccoooooooo
Housing + Transportation Costs
as a Percent of Local Income
Less than 48%
48% to 59%
59% to 65%
65% and Greater
Insufficient Data
Highways
Outer East Bay
Silicon Valley
South Bay
Peninsula
Inner East Bay
North Bay
lN
W E
S
© 2009 Center for Neighborhood Technology
East Bay end there. Typical monthly
transportation costs for these
North Bay neighborhoods of $ 1,106
are the second highest reported
in Table 6 and largely offset the
comparatively low housing costs in
these neighborhoods. Together, the
costs of housing and transporta-tion
create extreme cost burdens in
neighborhoods where the median
income is $ 50,673, or 70 percent
of the Bay Area’s median income—
leaving little funds for these house-holds
to spend on basic necessities.
Costs
Income
Outer East Bay
Silicon Valley
South Bay
Peninsula
North Bay
580
880
680
280
101
101
80
0 10
miles
20
San Francisco •
San Mateo •
• Oakland
• Hayward
www. bayareaburden. org n
16
By examining the combined
costs of housing and transporta-tion,
and the impacts of land use
decisions on the environment,
this analysis presents a more
complete measure of the “ cost
of place” in the Bay Area. Hous-ing
that appears affordable based
solely on housing costs may not
be truly affordable when it is
located far from transit, jobs, and/
or services. This underscores the
importance of broadening our
understanding of housing afford-ability
challenges to also include
transportation costs and both
the “ time tax” and environmental
impacts of commuting.
Over the next 25 years, the
Bay Area is projected to grow by
1.6 million new residents— a 22
percent increase in population. 10
This is an opportunity to integrate
land use, housing, and transporta-tion
policies to encourage new
residential development in areas
that are well served by public tran-sit
or near job centers.
Promising Policy Developments
The Obama administration, the
state of California, and the Bay
Area have taken a number of con-structive
steps to encourage new
patterns of growth and cleaner
modes of travel by facilitating the
development of affordable, transit-oriented
housing. For example:
n Through Resolution 3434, the
Metropolitan Transportation
Commission ( MTC) encour-ages
increases in residential
density near planned public
transit stops. MTC also pro-vides
grants to help communi-ties
plan for this outcome, as
well as funds for small- scale
Current and Future Challenges
“ We are the first in the nation to tackle land use
planning. What this will mean is more environmentally
friendly communities, more sustainable developments,
less time people spend in their cars, more alternative
transportation options, and neighborhoods we can safely
and proudly pass on to future generations.”
— Governor Arnold Schwarzenegger, September 30, 2008
n www. bayareaburden. org
17
improvements ( e. g., pedes-trian
walkways, bike lanes,
streetscape improvements) that
help make it feasible. 11
n Senate Bill 375, passed in 2008,
directs MTC to develop coor-dinated
housing, land use, and
transportation plans that lower
carbon dioxide emissions and fa-vor
transit- oriented development.
n Proposition 1C authorized
over $ 1 billion in state housing
bonds for the development of
transit- oriented housing and infill
infrastructure. Roughly half of
the housing units planned in the
first round of funding will be af-fordable
to households earning
80 percent of the area median
income or less. 12
n A regional joint committee iden-tified
approximately 120 areas
in 60 Bay Area jurisdictions as
either planned or potential Prior-ity
Development Areas ( PDAs),
defined as “ locally designated
land where future growth can be
channeled, at sufficient densi-ties
to take advantage of existing
infrastructure and services,
especially transit service.” In
total, these Priority Develop-ment
Areas represent less than
3 percent of the Bay Area’s total
land mass but could accommo-date
more than half of the Bay
Area’s projected housing growth
through 2035.13
n The Sustainable Communities
Initiative brings three federal
agencies— the Environmental
Protection Agency, the U. S. De-partment
of Housing and Urban
Development, and the U. S.
Department of Transportation—
together in an unprecedented ef-fort
to align federal policies and
funding for housing and
transportation projects.
www. bayareaburden. org n
Looking Forward
While the Bay Area has made
progress in aligning land use,
housing, and transportation
policies, much work remains to be
done. The data provided in this re-port
on the housing and transporta-tions
challenges faced by Bay Area
households and the consequences
for the environment may help
expand awareness of the problem
and build support for the resources
and high- level policy attention
needed to address
it effectively.
18
Methodology
The Original Housing +
Transportation Cost Model
The Housing + Transportation
( H+ T sm) Affordability Index was
developed by the Center for Neigh-borhood
Technology ( CNT) and its
collaborative partner, the Center
for Transit- Oriented Development
( CTOD), with support from the Brook-ings
Institution’s Metropolitan Policy
Program’s Urban Markets Initiative.
This cost index has been applied to
52 metro areas in the United States,
and is unique in that it measures
the joint transportation and housing
affordability at a neighborhood level
( see www. htaindex. cnt. org).
Transportation Costs
The transportation costs estimated
in this model and used in this report
are more than the cost of commut-ing
to and from work. They also
include trips to and from school,
errands, and other travel that is
part of the household daily routine.
The methods for the cost model
draw from peer- reviewed research
findings on the factors that drive
household transportation costs. The
model assumptions, calculations,
and methods have been reviewed
by practitioners at the Metropolitan
Council in Minneapolis- St. Paul, fel-lows
with the Brookings Institution,
and academics from the University
of Minnesota, Virginia Polytechnic,
Temple University, and elsewhere,
specializing in transportation model-ing,
household travel behavior, com-munity
indicators, and related topics.
Specifically, the transportation
cost model incorporates four neigh-borhood
variables ( residential den-sity,
average block size, transit con-nectivity
index, and job density) and
four household variables ( household
income, household size, workers
per household, and average jour-ney-
to- work time) as independent
variables. These variables are used
to predict, at a neighborhood level
( census block group), three depen-dent
variables— auto ownership,
auto use, and public transit usage—
that determine the total transporta-tion
costs.
Housing Costs
Housing costs were determined
using the census variables Selected
Monthly Owner Costs ( SMOC) for
Estimating Housing
and Transportation
Costs by
Neighborhood
n www. bayareaburden. org
19
Owners with a Mortgage and
Gross Rent for Renters Paying
Cash ( GR). SMOC is defined as
the sum of payments for mort-gages,
deeds of trust, contracts
to purchase, or similar debts on
the property ( including payments
for the first mortgage, second
mortgage, home equity loans,
and other junior mortgages); real
estate taxes; fire, hazard, and flood
insurance on the property; utili-ties
( electricity, gas, and water and
sewer); and fuels ( oil, coal, kero-sene,
wood, etc.). It also includes,
where appropriate, the monthly
condominium fees or mobile home
costs ( installment loan payments,
personal property taxes, site rent,
registration fees, and license fees).
Gross Rent ( GR) is defined as
the contract rent plus the esti-mated
average monthly cost of
utilities ( electricity, gas, water, and
sewer) and fuels ( oil, coal, kero-sene,
wood, etc.) if these are paid
by the renter ( or paid for the renter
by someone else). Using gross
rent eliminates differentials that
result from varying practices with
respect to including utilities and
fuels as part of the rental payment.
The estimated costs of utilities and
fuels are reported on an annual
basis but are converted to monthly
figures for the tabulations.
The census reports aggregate
values for both of these variables
as well as the count of owners and
renters used to compile the differ-ent
aggregates. Therefore, to find
an average value for SMOC and
GR, the aggregate is divided by the
number of households making up
the aggregate value. For the pur-poses
of this study, housing costs
are estimated using only renters
paying cash and owners paying
mortgages. Renters paying with
vouchers ( e. g., subsidized housing)
and owners who no longer have
mortgage payments are therefore
excluded.
For a full description of the
methods used in the original Hous-ing
+ Transportation Affordability
Index, see www. htaindex. cnt. org/
model_ summary.
Updating the Original
Model to 2005— 2007
Input data for the original model
are primarily composed of 2000
U. S. Decennial Census block
group data and values that were
created and calculated based on
these data. Since the most recent
data are for 2000, estimates for
2005— 2007 were carried out us-ing
a recognized procedure called
the “ constant- share method,”
which considered the percent
change of variables from 2000
to 2005— 2007 within the Public
Use Microdata Areas ( PUMAs).
PUMA data for 2005— 2007 were
obtained from the American Com-munity
Survey ( ACS) three- year
estimates while 2000 US Census
block group data were aggregated
to the same PUMA boundaries.
Once the percent changes were
calculated between the two time
periods for each PUMA for each
variable, these values were then
used as multipliers. Year 2000
values for each block group within
each PUMA were multiplied by
this percent change to estimate
2005— 2007 values at the block
group level.
Transportation costs were
updated by applying new cost
factors to the model’s estimates of
vehicle miles traveled and automo-biles
per household. These cost
factors were based on the 2006
AAA estimates of costs for owning
and operating a vehicle, which are
estimated to be $ 5,569 per auto
and 15.1 cents/ mile for fuel ($ 2.41/
gallon), maintenance, and tires.
www. bayareaburden. org n
20
1 2005– 2007 American Community Survey
three- year estimates. Data for the Bay Area
reflect the San Jose– San Francisco– Oakland
Combined Statistical Area.
2 The federal standard is that housing costs
should consume no more than 30 percent of
household income. Data are from the 2007
American Community Survey.
3 Metropolitan Transportation Commission.
2009, June. Statistical Summary of Bay Area
Transit Operators: Fiscal Years 2003– 04 through
2007– 08. Oakland, CA: Author.
4 Source Inventory of Bay Area Greenhouse
Gas Emissions, December 2008. Bay Area Air
Quality Management.
5 Condon, Patrick, Duncan Cavens, and Nicole
Miller. 2009. Urban Planning Tools for Climate
Change Mitigation. Cambridge, MA: Lincoln
Land Institute.
6 Energy Information Administration. 2005
Residential Energy Consumption Survey. Table
US1. Total Energy Consumption, Expenditures,
and Intensities, 2005, Part 1: Housing Unit
Characteristics and Energy Usage Indicators,
7 Table 5 estimates the cost of transportation
for a household earning the average median
income for the Bay Area. This approach
ensures that variations in transportation costs
among the different regions are due princi-pally
to such features of the built environment
as access to public transit, residential density,
and proximity to employment centers.
8 These regions were developed because
the main drivers of transportation costs—
particularly features of the built environment
( e. g., public transit rails and routes, residential
density, the proximity of employment centers)
and socioeconomic characteristics ( e. g.,
household income and composition)— do not
always adhere to city or county boundaries.
9 We focus here on the Inner East Bay and
North Bay because they are much larger
than the South Bay, and thus contain many
more people with extreme cost burdens, and
because the comparatively higher income of
South Bay residents suggests they are better
able to afford other essential costs.
10 Association of Bay Area Governments. 2008,
June. San Francisco Bay Area Housing Needs
Plan, 2007– 2014. Oakland, CA: Author.
11 Metropolitan Transportation Commission.
2009, April. Change in Motion: Transportation
2035 Plan for the San Francisco Bay Area.
Oakland, CA: Author.
12 Sprowls, Sharon. 2009. Evaluation of First
Round Awards Under California’s Transit-
Oriented Development ( TOD) Housing and
Infill Infrastructure Grant ( IIG) Programs. San
Francisco, CA: Housing California.
13 Metropolitan Transportation Commission.
2009, April. Change in Motion: Transportation
2035 Plan for the San Francisco Bay Area.
Oakland, CA: Author.
Calculator
References
What do housing and transportation
in the Bay Area cost YOU?
Find out with the Housing and Transportation
Cost Calculator.
The ULI Terwilliger Center for Workforce Housing is
pleased to announce its Housing + Transportation
Cost Calculator to the Bay Area to provide consumers
with up- to- date cost data to make informed housing
decisions based on housing and transportation costs.
To access the calculator, go to
www. bayareaburden. org.
n www. bayareaburden. org
n calculate the combined
housing and transportation
costs using household
characteristics and location;
n evaluate the factors that
determine housing and
transportation costs, and
how changes can impact
expenses;
n assess the true proportion
of income being spent on
housing and transportation;
n compare actual household
costs with neighborhood
and regional averages.
ULI Terwilliger Center
Housing and Transportation
Cost Calculator
www. bayareaburden. org
The Terwilliger Cost Calculator aids individuals, households,
planners, government officials and municipalities to
understand the true costs of housing and transportation,
and how these costs can vary by location within the Bay Area.
1025 Thomas Jefferson Street, NW
Suite 500 West
Washington, D. C. 20007
( 202) 624- 7000
www. uli. org/ TerwilligerCenter
Using the fully customizable tool, users can:
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