How Much Do You Need to Earn to Afford to Live in Napa Valley?
Napa County recently commissioned the State of Housing in Napa Valley report, prepared by Generation Housing (aka Gen H). And the California Housing Partnership recently published the Napa County 2024 Affordable Housing Needs Report. We want to take this opportunity to share some of the findings to impress upon our readers how important it is to increase the supply of rental and homeownership housing that is affordable.
Renters in Napa County need to earn $46.62 per hour or 2.9 times the California minimum wage, to afford the average monthly asking rent of $2,424. Below is a sample of earnings by job category to illustrate how illusive it can be for much of the local workforce to afford rent anywhere in the county.
(Source: Napa County 2024 Affordable Housing Needs Report)
There are 3,740 low-income renter households in Napa County that do not have access to an affordable home. Additionally, state and federal funding for housing production and preservation in Napa County has drastically decreased, with a 95% drop from the previous year, amounting to only $6 million in 2024.
The Gen H report is chock full of data and insights, too many to list here. We hope you will take a little time to peruse the report. Three themes that stand are:
-
Entry level homes are key to leaving the rental market but are rarely available.
-
Existing homes that might be suitable or “matched” to moderate- and low-income households are rarely available due to limited movement within the housing stock, a symptom of skyrocketing prices overall compounded by a relatively high rate of second homes that could be owner- or renter-occupied.
-
While employers in our key sectors tend to pay higher wages than neighboring regions and competitors, higher housing costs cut into those wages, resulting in housing cost burden and ultimately hurting employers and employees in essential sectors.
The Current Housing Landscape in St. Helena
A household paying more than 30% of its income on housing is “housing cost burdened.” According to the City of St Helena’s Housing Element Update (2022), in St. Helena, nearly 38% of householders are experiencing housing cost burden, with 16.1% of households spending the majority of their earnings on housing.
Rental Market
Only 18 percent of the total rental stock is deed-restricted affordable (218 units) with only 25 of those being built or preserved in the last 20 years. With our partners, Our Town St Helena is on pace to add 48 new and 12 preserved rental units serving very low- to moderate-income households in the coming few years. More is needed but it’s a good start. There also is a great need for “missing middle” housing for those households that earn too much to qualify for lower-income housing, yet still struggle to afford rent or a home purchase due to ever-increasing prices.
Home Ownership
Based on actual home sales in St. Helena from January to June 2024, the median home price was $2.15 million. To purchase a home at this price would require a $430,000 down payment and a monthly mortgage of $13,711, plus taxes and insurance. A household would have to earn $515,000 annually or $43,000 per month to qualify for the mortgage and to avoid being housing cost-burdened.
Currently in St Helena there are 41 affordable homes for owner occupancy, or 3 percent of the total ownership housing stock. Of these, only 11 were built in the last 20 years including the 8 townhomes developed by OTSH at Brenkle Court.
According to Gen H’s report, second homes constitute 54 percent of the vacant ownership housing stock in St. Helena – that’s over 250 homes that could be owned or rented by locals for long-term residency.
Some of the Effects
Householders are aging in place with no ability to downsize and free up larger homes because of rising prices and scarce supply. A direct fiscal impact is that homes are not changing ownership and therefore not being reassessed to generate property tax revenue.
Younger working families can’t afford to live here. From 2012 to 2022, Napa Valley households with children under age 6 decreased from over 12% to around 9.7%, negatively affecting local school enrollment.
Local businesses struggle to recruit and retain employees.
The character of our town is eroding. Our community is becoming one of commuters, second homeowners and vacationers, making it especially difficult to sustain a local workforce, recruit new civic leaders, and nurture the connective tissue of a small town.
Around 75% of local workers are commuting long distances to their jobs in St Helena, which negatively impacts the environment and the quality of life for the commuters. These 4,000+ employees are engaged in their own communities, not ours.
What Can You Do?
By highlighting some of the significant housing challenges we face and sharing important data and resources, Our Town St Helena hopes to raise awareness and inspire action. Here are a few suggestions:
Share our newsletter and urge others to sign up. Follow local housing issues, get involved. Become a YIMBY (“Yes In My Backyard”). Donate funding or property to Our Town St Helena to ensure we can continue increasing affordable housing opportunities. Encourage City leaders to prepare a results-oriented housing strategy. Serve on a housing non-profit board of directors or advisory committee (including ours). Volunteer.
It is crucial for policymakers, community leaders, and residents to come together to develop strategies that ensure housing for all. Only through collective efforts can we hope to create a more equitable and stable housing environment for the future.
