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KCBX's Out of Reach is an in-depth series on Santa Barbara County's housing crisis, reported by Beth Thornton. Senior editor Marisa Waddell and editor Benjamin Purper contributed to this project. This special report is made possible by a grant from the Sunflower Foundation.

Out of Reach: Faced with crushing housing costs, Santa Barbara locals weigh their options

Building workforce housing near downtown can reduce the need for cars and revitalize businesses.
Beth Thornton
Building workforce housing near downtown can reduce the need for cars and revitalize businesses.

Finding a place to buy or rent in Santa Barbara County is more challenging than ever due to high prices and low inventory, and it’s forcing residents to reconsider whether they can afford to live there.

Michael Graham has lived in Santa Barbara with his wife and business partner, Kathryn, for 19 years. They own the Cheese Shop downtown.

Owning a home in Santa Barbara has long been a dream of the Grahams. But after many years of watching prices go up and up, they’ve put that dream on hold.

“Definitely, housing has been a challenge. The goal always has been to own a home here, but the prices have been out of our reach,” Michael Graham said.

A rendering for proposed moderate-income workforce housing near downtown Santa Barbara.
Screenshot from Housing Authority of the City of Santa Barbara
A rendering for proposed moderate-income workforce housing near downtown Santa Barbara.

In addition to soaring home prices, natural disasters such as the area’s massive 2017 Thomas Fire and then Covid-19 affected their business, so the couple said it’s been a tough few years in Santa Barbara.

Kathryn said they’re not the only ones frustrated by the impossible housing prices.

“We’ve had a countless number of good friends that have opted to leave Santa Barbara because they want to start families and it’s not cost effective to live here in town,” she said.

Kathryn said she sometimes thinks about moving, too.

“We are constantly weighing that, especially in light of the fact that not only as the owners of this business we can’t afford to get into this market, but our staff, too, can’t afford to live here,” she said.

Kathryn said the high cost of rent and lack of available housing makes it hard to find employees. She recently purchased an Amtrak train pass for an employee who moved back home with her parents in Ventura County, about an hour away.

“This is a great staff person, fully-trained, and so we really wanted to find a way to at least keep her around for the summer, because it’s taking on average at least two months to find new people,” she said.

Stories like this are commonplace in Santa Barbara these days. As we reported in an earlier segment on Out of Reach, local workers spend a lot of time commuting to Santa Barbara.

Bob Walsmith, Jr., this year’s president of the Santa Barbara Association of Realtors (SBAOR), said it’s been a challenge for people looking to buy homes. There’s been limited inventory, he said, but he thinks the market is beginning to change.

An open house sign in Santa Barbara.
Beth Thornton
Realtors expect to see more inventory on the market in Santa Barbara.

“We were living in a seller’s market for quite a long time and that’s definitely shifting, especially in the last month or so,” he said.

But local economists do not expect home prices in Santa Barbara to drop drastically — which means the median home price will likely remain over a million dollars.

Walsmith said finding a place to rent is incredibly difficult right now, too. He regularly fields phone calls from people seeking advice.

“It’s almost impossible to find rentals now. The apartment occupancy rate in our area is approaching 99%,” he said.

The price of rent in Santa Barbara is up 24% in the last year, according to Apartments.com, and there are almost no vacancies.

Rob Fredericks, Executive Director of the Housing Authority of the City of Santa Barbara, said the average rent for a one-bedroom apartment is about $2500 per month.

“Renters are being absolutely crushed right now,” he said.

Fredericks said the Housing Authority provides rental assistance for low-income earners, and they also build workforce housing for what he calls “the missing middle.” That’s a term for households that don’t qualify for low-income housing, but also can’t afford current market rates.

“They are professional, working households that, even at the income up to 120% of Area Median Income, cannot afford the rents that are here,” he said.

Fredericks said the household Area Median Income figure used by the city is $100,000.

The Carillo Commuter Lot offers parking for commuters in Santa Barbara.
Beth Thornton
This lot on Carrillo Street in Santa Barbara is the future site of a workforce housing development.

He said the city of Santa Barbara is making it easier to develop workforce housing downtown by adjusting parking requirements and prioritizing areas that are walkable and close to public transportation. He said downtown housing can reduce the need for cars and help revitalize local businesses.

One Housing Authority project coming soon will transform an underutilized parking lot on West Carrillo Street into moderate-income workforce housing.

“Frankly, something that’s so needed along State Street and along the two outer blocks of State Street, is residential housing to bring that vibrancy back to downtown,” Fredericks said.

Shop owner Michael Graham says he’s eager to hear what the city has planned for housing at all income levels, including the missing middle. He says he loves Santa Barbara but the housing problems need immediate attention so current residents can afford to live and work there.

“If you don't plan for it or make decisions, and try to keep things how they've always been, I don’t see that working out very well for the community at all,” he said.

Out of Reach is made possible by a grant from the Sunflower Foundation.
Senior editor Marisa Waddell and editor Benjamin Purper edited this story.

Beth Thornton is a freelance reporter for KCBX, and a contributor to Issues & Ideas. She was a 2021 Data Fellow with the USC Annenberg Center for Health Journalism, and has contributed to KQED's statewide radio show The California Report.
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