San Jose developers on hook for affordable housing requirements

Supreme Court declines to hear case challenging the city’s plan to collect fees from affordable housing developers, and real estate agents in the Bay Area fear it may further drive up home prices and constrict supply
  • In 2010, San Jose's City Council in 2010 approved an ordinance requiring new residential development projects of 20 or more units to sell at least 15 percent of the for-sale units at a price the city would determine to be "affordable" or pay a $122,000 in-lieu fee.
  • The California Building Industry Association (CBIA) filed a lawsuit arguing that the ordinance was invalid.
  • The Supreme Court has declined to hear the case -- meaning the ordinance will move forward, developers are still on the hook, and agents in San Jose might see fewer transactions.

If local governments strongarm developers into paying for housing viewed as a public need, will that have unintended consequences for the local market? That’s the concern of many real estate agents in San Jose.