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Housing bust's ripple effect felt at bottom of Sonoma County rental market

Kindra Pedro, center, and Jennifer Varano, left, prepare a dinner plate for Varano's daughter, Kaylee Poni, 12, at their Santa Rosa apartment on Wednesday, April 17, 2013. Pedro and Varano are recovering addicts that Catholic Charities helped with housing.

(Christopher Chung/ The Press Democrat)
Published: Monday, April 22, 2013 at 7:51 a.m.
Last Modified: Monday, April 22, 2013 at 7:51 a.m.

While many of those who lost homes during the housing bust and economic meltdown may not have ended up on the street, they almost certainly disrupted the rental-housing food chain, whose lower rungs are a crucial part of housing some of Sonoma County's homeless.

Many of the almost 50,000 county residents who were forced out of their homes by foreclosures and short sales since 2007 took refuge in what quickly became a tight rental market. That, coupled with a short supply of rentals, drove rents higher and created a competitive market that has been devastating to some lower-income residents and people at risk of being homeless.

The trickle-down effect is being felt at some local homeless shelters, where the general lack of rental housing is causing a bottleneck.

“People are staying longer in shelters. We can't get them out as quickly because there's a lack of housing,” said Jennielynn Holmes, program director for Catholic Charities' housing and shelter programs.

Holmes said she hasn't seen a lot of people who have lost homes in a foreclosure coming to shelters operated by Catholic Charities. “But what I am seeing is that people that were foreclosed on are moving into the rental market and that's making it harder for people with lower incomes and poor credit to move into the rental market,” she said.

Kindra Pedro, 38, of Santa Rosa, is among those who have had difficulty finding a place to rent because of bad credit.

Pedro, who is currently recovering from years of drug use, has successfully been through a number of Catholic Charities housing programs designed to help homeless people into permanent housing.

Pedro's road to the streets began when she was a child, sexually abused by a family member. Her abusive past left her with the “motto,” she said: “People are here just to hurt me, so I will hurt everyone I can.”

She started using methamphetamine when she was 14, became pregnant at 20 and lived in one drug house after another, long after her baby boy was born. She said her son would often feed himself by opening cans of food.

Pedro hit bottom a few years ago, when she found herself making a fire to boil water outside a drug house where she was staying.

“Here I am trying to help him wash for school and I just went down on my knees and prayed for help,” she said. “Pretty much that was when my life changed... pretty much.”

First she got into a Santa Rosa drug treatment program, then when she graduated from that Pedro got into Catholic Charities' Family Support Center, a comprehensive homeless shelter for families with children. Catholic Charities transitional housing and, currently, permanent supportive housing have given her the resources and time to get back on her feet and go back to school for vocational training.

“I'm now a welder millwright for (union) Local 101,” she said. “More than being proud of myself, I'm grateful to God and Catholic Charities.”

But organizations like Catholic Charities rely on the assumption that there's enough affordable rental housing at the end of the tunnel, and the tight rental market is making that scenario increasingly difficult.

“Everything trickles downhill. When there's more demand in the multi-housing rental market, prices go up,” said Nick Grotjahn, a spokesman for RealFax, a Novato-based apartment market research firm.

Since 2008, there have been essentially no apartment units built in Sonoma County. Meanwhile, the influx of former homeowners into the rental market began pushing county occupancy rates higher.

According to data from RealFax, the apartment occupancy rate was 91.9 percent, and by 2012, the rate had climbed to 96.8. Any rate above 95 percent is considered “full occupancy,” Grotjahn said.

Of the 26 metropolitan statistical areas in California, the Santa Rosa-Petaluma area — essentially Sonoma County — had the state's second highest average occupancy rate in the first quarter of 2013, just behind Redding. Sonoma County had the 9th highest average rent for the first quarter of the year, $1,307, according to RealFacts data.

Grotjahn said relief for renters will come when demand decreases. Housing experts say that will most likely come from long-time renters and former homeowners re-entering the real estate market rather than from new construction, as banks continue to make lending difficult.

The rental crunch has made certain housing initiatives operated by local homeless-service providers an essential tool in keeping some people off the street.

Last July, the Interfaith Shelter Network expanded its homeless services to include a transitional housing program specifically for 100 chronically homeless veterans, 75 in Santa Rosa and another 25 in Mendocino County.

“We have to find apartments, sometimes condos, sometimes homes ... In some cases we've had to find two- or three-bedroom homes for veterans and their families,” said Pamela Wallace, executive director of the Interfaith Shelter Network, a Santa Rosa-based nonprofit that has been providing homeless services for about 23 years.

This year the organization, using federal grant dollars, launched a rapid re-housing program, aimed at people who have been hit hard by the recession and are on the verge of being homeless.

Wallace said the recession has broadened the demographic profile of the local homeless population beyond the chronically homeless.

“The economy is really creating a whole new class of homeless people and that's the really sad part,” she said.

At Catholic Charities, the organization's permanent supportive housing program has been maturing and growing in recent years. In the beginning of April, Catholic Charities partnered with a landlord to permanently house four homeless families.

Catholic Charities becomes the master lease holder and continues to provide supportive services to keep the families in the home. Such programs are partly an effort to free up space in shelters and transitional housing, said Catholic Charities' Holmes.

Holmes said that in November, Catholic Charities started a waiting list for the first time at Sam Jones Shelter in Santa Rosa. The shelter has 120 beds for single adults, and currently has 43 people on the list last week.

Holmes said that between January and March, about 40 people who have been housed in the shelter identified themselves as “first-time homeless.”

“That's higher than usual for us,” she said. “One of the things you hear a lot from clients is that they've been limping along for the last couple of years and finally their safety net just broke.”

Holmes said the high demand for rental apartments is giving landlords the luxury of being “pickier.” The evidence is found in county shelters and other temporary housing programs.

“People are staying longer and we're not able to serve as many people in the shelter,” she said.

(You can reach Staff Writer Martin Espinoza at 521-5213 or martin.espinoza@pressdemocrat.com.)

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