Laserfiche WebLink
C. Non-Governmental Constraints <br /> <br />Market constraints significantly affect the cost of housing and are important factors to take into <br />account when discussing affordable housing. Escalating land prices and construction costs and <br />fluctuating interest rates are major contributors to the cost of housing in the San Francisco Bay <br />Area. <br /> <br />1. Availability of Financing <br /> <br /> Interest rates for home financing and rental development have a crucial effect on the <br /> affordability of housing in Pleasanton. Mortgage interest rates have remained relatively <br /> stable over the past five years, at about 7.5 percent. <br /> <br /> Were high interest rates to return, the City could mitigate some of the effects by issuing <br /> (or participating in County issues of) Tax-Exempt Mortgage Revenue Bonds. These can <br /> be issued for multi-family developments that require a percentage of low-income units <br /> and for mortgage financing for first-time buyers of single-family homes. <br /> <br />2. Price of Land <br /> <br /> Based upon City estimates, the average cost of vacant land supported by public <br /> infrastructure in Pleasanton is $85,000 for single-family lots (9,000-square foot average <br /> parcel size) and $15,000 for multi-family housing (assuming 20 units per acre). <br /> <br />3. Current Cost of Construction <br /> Housing construction costs per unit in Pleasanton are estimated by the City as follows: <br /> <br /> Materials/ Soft Costs- 15 % <br /> Land Fees Labor (Design/Financing) Total <br /> <br />Single-Family Unit $85,000 $28,000 $189,000 $45,300 $347,300 <br />(2,250 sq. ft.) <br /> <br />Multi-Family Unit $15,000 $15,000 $64,800 $14,200 $109,000 <br />(900 sq. ft.) <br /> <br /> 13 <br /> <br /> <br />