First-of-its-kind accelerator will focus on the housing crisis
June 6, 2019
A new accelerator, the Housing Lab, is the latest solution to the growing Bay Area housing crisis. The first-of-its-kind accelerator is the result of a collaboration between CED and the Haas School of Business and is housed in the Terner Center for Housing Innovation at the Fisher Center for Real Estate & Urban Economics.
“The need for innovative solutions and outside-the-box thinking has never been more urgent, and we’re encouraged by the growing number of entrepreneurs who are challenging our antiquated housing system and considering new ways for housing to be more equitable and affordable across the board,” said Terner Center Faculty Director Carol Galante, who previously served in the Obama Administration as U.S. Assistant Secretary for Housing.
According to the Joint Center for Housing Studies of Harvard University, median home prices are rising faster than inflation, causing an imbalance in housing demand, and a scarcity of housing and new home construction supply.
Housing entrepreneurs must wade through copious amounts of red tape, such as finicky zoning codes or complex construction standards, that add to the crisis and hamper any quick solutions. Along with those challenges, many housing innovation startups may have trouble being accepted into a traditional technology-focused accelerator.
“Most accelerators and VC funds direct the majority of their capital to pure technology-focused innovations, and we think there are a lot of other good ideas out there that may not fit the VC model — either because they’re not a pure tech company, or they’re focused on a more regional market,” said Housing Lab Program Director Michelle Boyd (MBA ‘19), who began working on the accelerator as a student and is staying on post-graduation to lead it. “These companies are also asset-intensive, meaning they own and operate real assets and buildings, and there is less support for startups like that. We want to elevate these ideas and connect them to the capital they need to scale.”
The Housing Lab alleviates bureaucratic hassle for these innovators, providing expertise about building regulations, helping streamline business plans, and connecting entrepreneurs with investors, including members of the Housing Lab’s Advisory Board.
Applications are being accepted now until July 12. The Housing Lab will make its debut in September with the selection of five startups who will join a six-month program and receive seed-funding grants of $100,000 to $150,000.
The Terner Center is also an advocate for another housing trend in the Bay Area: Building Accessory Dwelling Units or ADUs. Commonly known as granny-flats or mother-in-law apartments, ADUs refer to dwellings attached or detached from the main residence.
While ADUs aren't necessarily a cure-all salve for the Bay Area's housing issues, some say they can help ease the region’s struggles in untapped ways. David Garcia, policy director for UC Berkeley's Terner Center for Housing Innovation, called the growth of ADUs "a positive" for the Bay Area. (per SFGate)
"[ADUs are] one of many tools that the region needs to confront its broader housing crisis," said Garcia. "I think ADUs present the lowest hanging fruit: They typically encounter less resistance [from cities], they're cheaper to build and they're oftentimes rented at below market rates, or many times, nothing at all because of the relationship between who lives in the ADU and the homeowner."