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Construction Costs According to a March 2020 report published by the Terner Center for Housing Innovation at UC Berkeley, construction costs for multi -family housing in California have climbed 25 percent between 2009 and 2018. This increase is in part due to the higher cost of building materials, such as wood, concrete, and steel, as well as prevailing wage requirements. According to RSMeans, construction costs (including materials and labor but excluding soft costs such as fees) for a small apartment complex in the Pleasanton area ranged between $171 to $201 per square foot in 2021. However, based on the City's 2018 affordable housing impact fee nexus study, multi -family construction costs ranged from $215 per square foot for a rental development and $225 per square foot for a for -sale development. Construction costs have continued to increase since 2018. Construction costs can vary depending on the type of development, ranging from more expensive steel -frame Type I construction to more affordable wood -frame Type V. Due to the smaller scale, single-family homes tend to be more expensive to construct on a per square foot basis than multi- family. This cost can fluctuate depending on the type and quality of amenities to the property, such as expensive interior finishes, fireplaces, swimming pools, etc. Soft costs are the costs that are not directly incurred by the physical construction of the development. These costs include services for architectural, consultant, and legal services, as well as permitting requirements and impact fees. They generally range from 15 to 30 percent of total development costs but can fluctuate depending on local fees and exactions. Please refer to the Permit and Development Fees section, above, for a discussion of the City's required permit and development fees. C.3.3 Availability of Financing The availability of financing can impact rates of homeownership. The ability to secure financing can be influenced by several factors, including creditworthiness, debt -to -income ratio, and the restrictiveness of mortgage lending standards. Reviewing data collected through the Home Mortgage Disclosure Act (HMDA) can reveal the role the lending market has had on local home sales. Home purchase loans in 2020 are summarized in the table below. Almost all traditional home loan applications (between government -backed and conventional) in 2020 were for conventional loans, for a total of 894 home loan applications across both types. This disparity could be driven from high home values in Pleasanton, as government -backed loan programs typically have a maximum loan amount. The approval rate for conventional loans was 78 percent. In competitive housing environments, where purchasing a new home may be out of reach for some, home renovations can be a desirable and more affordable way to add value to property. There were 183 home improvement applications in 2020. The approval rate for these types of applications was 56 percent. Housing Constraints City of Pleasanton i C-35