Who pays for California’s affordable housing?

“If elected governor of California, one of my goals will be to slash the value of California real estate.”

Said no politician ever.

But if California is truly serious about affordable housing — and I’m becoming convinced it’s not — then somebody in the real estate world must accept less than what they have right now.

The pandemic era — not to mention a recall election campaign for the governor’s job — got many Californians rethinking housing.

Look what’s happened. A surprising homebuying binge ballooned prices across the state. Despite historically low mortgage rates, only 23% of California households could afford to buy the typical house this spring, according to a California of Association of Realtors index. That’s down from 35% in 2020’s first quarter before the coronavirus upended the economy and the lowest affordability rate since the end of 2007.

And note, affordability is down nationwide, too: 50% in the spring versus 59% just before COVID-19 hit and the lowest since the end of 2010.

Policy discussion is always good. However, it’s too easy for people — from political candidates to industry know-it-alls to your nosy neighbor — to say California’s housing challenges are simple supply versus demand issues being thwarted by government meddling.

Doesn’t Econ 101 say there’s no free lunch?

Yes, tossing government money at the problem often just raises costs by giving buyers more reasons to overpay. Yet the competing “build it and they will come/free market” logic is no panacea either.

Lifting much-maligned bureaucratic limits on California housing development — and of course, every real estate faction has their favorite rules to rescind — will create marketplace upheaval. That means winners … and losers.

As a result, the economy’s primal pressures will nudge certain market participants to push back against change — and those capitalistic forces will resist societal needs and even use their government pals to protect their interests.

Or in Econ 101 terms — owners want to maintain, if not increase, the value of their assets.

So to those who think “Make California Affordable Again” is easy, just tell me who pays …

Current homeowners? A California with a sudden supply of affordable housing would likely see home values fall. And Californians would have new neighbors in denser projects, whether those are in