It's old news that housing in Napa County is expensive, no matter whether you rent or own. And, even though sales have plummeted more than 40 percent in the last year, two themes prevail for middle- and low-income residents: purchasing a house is not possible for most, and finding an affordable rental is increasingly difficult. In 2007, median housing prices began to decline, but the latest median price of roughly $565,000 is out of reach, even for middle-income wage earners. The City of Napa reports median household income at $71,345, while the County median is a bit higher at $74,146. Still, the annual income needed to buy a median-priced home is nearly twice that (assuming the buyer puts five percent down), according to the California Budget Project (CBP), a nonprofit, non-partisan group that tracks economic trends. This disparity means that many professionals--including dental hygienists, nurses, teachers and carpenters--can't afford to buy. In fact, among people that own their homes, nearly 20 percent spend half or more of their income on housing, which is higher than the state average. Between 2000 and 2006, the housing market "boom" cycle, many people who previously couldn't afford to buy had access to ownership. Credit requirements eased or were eliminated; subprime and adjustable rate mortgages, jumbo loans, "teaser" rates and other risky financing options for first-time and low-income home buyers flourished. Extended families also began pooling resources to buy and live together, which made home ownership possible for them. As the housing and mortgage markets tumble, many first-time and low-income buyers are proving to be the most vulnerable. A foreclosure begins when a homeowner is three months delinquent on mortgage payments. The entire process can take five to eight months. Foreclosures have skyrocketed in the last year: The Napa County Assessor recorded 22 Trustee's Deeds in 2006 and a whopping 213 in 2007. (A Trustee's Deed indicates that a property has been taken over by a bank or lender, marking a completed foreclosure.) While most households in Napa County are owner-occupied, among the 38 percent who rent, most are Latino and more than one-third of them live in overcrowded conditions, according to CBP. Nearly all tenants who are classified as low-income spend 30 percent or more on of their earnings on rent. It's no wonder that this is the case: In our County, if you earn minimum wage, you have to work 80 hours a week to afford a studio apartment; 90 for a one-bedroom; 117 for a two-bedroom; and 161 for a three-bedroom apartment. People earning more than minimum wage, which is $8 per hour in California, need to take home nearly $17 an hour to pay rent for a studio; $19 for a one-bedroom; $24 for a two-bedroom; or $33 for a three-bedroom apartment. The escalating number of Trustee Deeds already has shown signs of a cascading effect on the rental market: Former owners are seeking rentals; tenants are being kicked out by banks rushing to sell off a foreclosed property; and, landlords are raising rents. A tight rental market adds layers of complexity for anyone needing affordable shelter in our County--be they low- or middle-income residents, or homeless families working to move into permanent housing.

$175 million. That's the sobering amount the City of Napa's economy is likely to shrink in 2008 as a result of the current mortgage crisis, according to a study commissioned by the U.S. Conference of Mayors. Residents already are feeling the effects, and so are nonprofits across our Valley. For instance, Napa County's four family centers, which help low-income households build emotional resiliency and economic stability, all report a variety of fallout thus far, including: clients defaulting on mortgages, either due to high-risk loans or a job loss; and single- or double-income households that are delinquent with car or credit card payments. Typically, these kinds of scenarios increase pressure in family systems and surface underlying emotional challenges. In fact, some of the family centers identified an increase in counseling services to couples who are experiencing economic strain. These nonprofits also reported more referrals to Napa Valley Food Bank or other food programs for households that are struggling with mortgage, rental or credit card payments. Both Legal Aid of Napa Valley and Greater Napa Valley Fair Housing Center are seeing an uptick in tenants facing unexpected eviction by banks that have taken possession of a foreclosed property. More low-income clients are looking for apartments or homes to rent, and as the market tightens, prices are less affordable, and landlords are less willing to accept tenants with poor credit. Napa Valley Community Housing, a nonprofit that provides 600 rental apartments and homes to low-income families, has almost no vacancies. Its typical vacancy rate is 10 to 15 percent. Families that are priced out of the rental market often live in overcrowded situations, or sometimes they can find subsidized housing. This means the tenant, who is low-income, pays an amount that is affordable, and the property owner receives the balance in the form of a federal subsidy. Historically, Napa's inventory of subsidized housing has lagged behind the demand--some people wait one or two years. A crippled real estate market means that fewer property owners will participate in federal subsidy programs, and many already are declining to renew existing contracts. This squeeze impacts homeless individuals and families that are trying to transition to permanent housing, according to Community Action Napa Valley's Shelter Project. The Shelter Project provides temporary housing and services to homeless individuals and families. For example, its South Napa Shelter provides beds to homeless people for a limited time. During the first nine weeks, counselors help residents, who must stay clean and sober, find employment and start saving money towards permanent housing. After these two months, the clients transition to apartments they will be able to afford over the long term; 70 percent of South Napa Shelter residents make this transition. Section 8 vouchers and other rental subsidy programs are integral to these residents' strategies to end their cycle of homelessness.