The Bay Area has long been entangled in a housing crisis, and housing unaffordability has become even more of a concern since the onset of Covid-19. Before the pandemic, a region-wide affordable housing shortage, rising costs of living, and worsening income inequality led to the displacement of many low-income residents. The economic turmoil of the pandemic brought an added layer of uncertainty for millions of Bay Area residents. While federal, state, and local eviction moratoriums once protected renters who were unable to pay their rent, the rollback of these protections over the past 18 months has led to landlords across the region filing thousands of eviction lawsuits against their tenants. The region's homelessness crisis also continues to grow, with an 8 percent increase in the regional homeless population between 2019 and 2022.

Data on residents’ financial well-being shows that neighborhoods across the entire region have become less affordable for renters and homebuyers alike. Moreover, residents of color continue to bear an outsized share of the rent debt accrued throughout the pandemic.

The Bay Area Equity Atlas has been tracking the nine-county region’s progress toward an inclusive and equitable recovery through the Bay Area Recovery Tracker — a regularly updated dashboard that features longitudinal data on economic security and prosperity, housing justice, and healthy communities of opportunity. This analysis provides a closer look at the housing affordability trends unfolding across the region.

Our key findings include the following:

• Since the start of the pandemic, 95 percent of zip codes in the Bay Area have become less affordable for prospective homebuyers, as measured by the ratio of typical home values to median family incomes.

• In 85 percent of the Bay Area neighborhoods where data is available, the share of yearly household income spent on rent has increased since the beginning of 2020.

• At the end of 2022, one in 10 Bay Area households were behind on rent, with households of color being almost four times as likely as white households to have rent debt.

• Many Bay Area renters have accrued “shadow debt” by borrowing money from individuals or lending institutions to cover unpaid rent.

Housing Continues to Grow More Unaffordable for Bay Area Owners and Renters Alike

While home values have somewhat declined throughout the Bay Area since the middle of 2022, there has been a net growth in housing prices in the vast majority of zip codes since the start of the pandemic. Since early 2020, the Bay Area has experienced the highest net outflow of residents among all US metropolitan areas. Many of those who’ve left the region have relocated to more affordable parts of California and other states. From the pandemic’s onset to early 2022, eight of the nine Bay Area counties saw increased home prices, due in part to low interest rates and the proliferation of high-earning, newly remote workers moving farther away from their workplaces. San Francisco was the only Bay Area county where home values did not spike, as the outmigration of local workers to surrounding counties contributed to the rise in home prices throughout the region.

As a result, in 95 percent of neighborhoods across the Bay Area, home prices have grown more quickly than local incomes have risen. Between the start of 2020 and the end of 2022, home values soared relative to incomes in many of the region’s low-density, wealthy areas — from swaths of the North Bay to the East Bay Hills to large pockets of the Silicon Valley suburbs. For example, in Ross — a predominantly white, high-income neighborhood in Marin County — the typical home cost increased from 10 times the median household income in January 2020 to almost 13 times the median income by December 2022. Home purchases also became increasingly unaffordable in many communities of color with much lower median incomes. In Richmond — a predominately Black and Latinx working-class community located in Contra Costa County — the typical home value cost seven times the median household income in December 2022. In the 262 Bay Area zip codes where we have sufficient data on typical home values, the average home value was almost 10 times the median household income in December 2022.

The large majority of the 13 zip codes where homebuying became relatively more affordable are in San Francisco, particularly in the northeastern neighborhoods of the city where single-family homes are sparser. Although San Francisco home values stagnated or decreased in value during the pandemic, they started at a higher baseline in early 2020 compared to many parts of the region. For instance, the ratio between home prices and median incomes in San Francisco’s Mission District dropped in mid-2022 as interest rates rose. Yet, at the start of the pandemic, homebuying was already untenable for many families, such as the working-class Latinx communities who have long called the Mission home: in January 2020, the typical home in the Mission was already more than 9 times the median household income.

Rental costs have risen alongside home values in the region. Out of the 133 zip codes for which we have sufficient data, 85 percent have seen market-rate rents become larger shares of yearly household incomes. Many of the neighborhoods with the steepest rent increases are home to low-income and middle-class communities of color, including the Excelsior and Oceanview districts in San Francisco, deep East Oakland and San Leandro in Alameda County, Antioch and Martinez in Contra Costa County, and the predominantly Asian American and Pacific Islander ethnoburbs north of San Jose.

Households of Color Have Accrued More Rent Debt throughout the Pandemic, Putting Them at a Higher Risk of Eviction

As rental costs have risen across the Bay Area throughout the pandemic, many households continue to struggle to keep up with rent. As of mid-April 2023, an estimated 103,000 Bay Area households were behind on rent, with an average of $6,580 in rent debt per household. Temporary relief funds, like the California Emergency Rental Assistance Program, have stopped accepting new applications, and eviction moratoriums are no longer in place — which means that tens of thousands of households face the prospect of carrying long-term debt or losing their homes.

Renters of color bear a disproportionately high share of this regional rent debt. At the end of 2022, one in seven Bay Area households of color were behind on rent — a rate almost four times higher than the fraction of white households with rent debt. While the share of non-white renters with rent debt has dropped from its peak in the middle of 2021, there has been no net change since August 2020, during the height of the pandemic. Over that same period, a slightly larger share of white households have been able to pay off their rent debt, meaning the debt gap between white renters and renters of color has worsened since 2020.

Many Bay Area Renters Have Accrued “Shadow Debt” by Borrowing Money to Cover Unpaid Rent

When faced with the financial responsibility of rent during the pandemic, many households took on additional debt to avoid lapsing on rental payments. Renters borrowed money from family and friends, acquired payday and title loans, and used credit cards to pay their rent. This accrual of rent debt to lenders, rather than landlords, is “shadow debt.” This type of debt was not eligible for pandemic-era governmental assistance.

The California Emergency Rental Assistance Program (ERAP) operated between March 2021 and March 2022. It supported low-income tenants who had accrued rent debt during the pandemic. Eligible renters could receive up to 18 months of rent and utility arrears for rent left unpaid after March 31, 2020, as well as prospective rent and utility payments. While the program offered critical support to hundreds of thousands of Californians, it faced many challenges, including high denial rates and long wait times for those who did receive assistance. Additionally, ERAP only covered debts owed directly to landlords — meaning that households who had borrowed money from elsewhere to cover their rent were ineligible for relief. A 2021 analysis of California’s ERAP program, which surveyed nearly 30 percent of applicants, determined that a majority of survey respondents had taken on shadow debt in the first year of the pandemic — averaging more than $3,000 owed per household. Since this shadow debt was not eligible for federal relief funds, many renters that borrowed money to cover their housing costs ended up worse off than if they had just let their bills lapse.

Although it was a lifesaver for some, California’s ERAP program did not fulfill the dire needs of many renters across the state. Thirty percent of San Francisco households that applied to the statewide program were denied. Renters, like Yasemin, who dealt with accruing rent debt through taking on additional debt were completely unsupported by this program. 

An Equitable Economic Recovery Will Require Policies that Ensure Housing Justice for All Bay Area Residents

To ensure housing justice for all in the region, equity-focused policies must be enacted that prioritize affordability in the region. These could include: 

• Implementing Tenant Opportunity to Purchase(TOPA)/Community Opportunity to Purchase (COPA) policies. TOPA provides tenants in multifamily buildings the opportunity to collectively purchase their buildings. COPA gives qualified nonprofit developers the priority to purchase multifamily properties and developable land on the market.

• Increasing housing affordability through inclusionary zoning practices. Such practices include requiring developers to set aside a portion of newly constructed units for qualified low-income households as well as the establishment of housing trust funds, which are created by local jurisdictions to provide dedicated revenue to support affordable housing. There also must be a focus on building more specifically affordable housing stock and ensuring that local land use and development policies prioritize these efforts, not just market-rate housing.

• Implementing policies such as just cause legal protections, which are designed to prevent discriminatory evictions from landlords, to protect tenants.

• Moving beyond temporary fixes, like California’s ERAP program, by creating a permanent program to support renters in California who are struggling to stay afloat because of income inequality and high housing costs.

An equitable recovery would ensure that all Bay Area residents have access to safe and affordable housing.

Back to Top