Published on October 18, 2017
The City of San Diego’s new Affordable Homes Bonus Program (AHBP) has shown initial success with a surge in applications to produce more market-rate and affordable homes.
In 2016, the City of San Diego adopted an innovative new AHBP to encourage the development of new homes. The AHBP provides meaningful financial incentives to developers that choose to build a percentage of their developments as affordable.
The AHBP builds on the existing California Density Bonus Law, which offers a variety of benefits to developers, namely added development capacity, when they choose to provide at least some deed-restricted affordable homes. Proposed by Mayor Faulconer’s administration, San Diego’s AHBP was approved unanimously by the San Diego City Council. Circulate San Diego led a coalition of advocates to support the program’s adoption.
While no project has yet been built using the AHBP, it can be evaluated by examining project application data. In the few short months of its existence, the AHBP generated a surge of applications for new market-rate developments in the City of San Diego that plan to include affordable homes.
An analysis of data from the San Diego Housing Commission shows that compared to the predecessor Density Bonus Program, the AHBP is set to produce:
- 900 percent increase per month for projects applying to use the program.
- 473 percent increase per month for deed-restricted affordable units.
- 453 percent increase per month for combined affordable and market-rate homes.
The AHBP is an early success for the concept of city-wide policymaking to advance the goals of housing production and sustainable growth for San Diego. The City of San Diego should monitor the program closely to ensure its continued success.
Circulate San Diego recently launched our #PlanDiego initiative, to provide research and policy advocacy related to sustainable land uses in the San Diego region.