Abstract
California faces the loss of thousands of affordable rental units in the coming decade as affordability restrictions— known as covenants—expire. These agreements, signed between housing developers and government agencies, typically last 15 to 30 years and require that units be rented at below-market rates. When covenants expire, owners can convert units to market-rate housing, often displacing lower-income families.
In Southern California alone, over 17,000 affordable units are at risk of conversion, and nearly 70% of these units are located near high-quality transit. If the owners of these properties do not enter into new covenants, these units will be placed on the open market, likely leading to the displacement of lower-income residents to the urban outskirts, resulting in longer commutes and reduced access to reliable transit. To better understand the risk of losing affordable units, this brief analyzed historic data on affordable housing conversion and identified key factors that influence whether at-risk properties are preserved or lost.
