Developers looking to build for-sale homes in Newport Beach near John Wayne Airport won’t need to build as many affordable units after officials decreased low-income housing requirements — despite pushback from regional and state transportation officials.
Previously, 15% of the units in for-sale residential developments near the airport needed to be affordable for low-income families. Now, only 6% of the project will need to be affordable for low-income households and 8% will need to be set aside for moderate-income families.
It’s only required for a specific residential area near the airport around Bristol Street, Birch Street, Macarthur Blvd and Jamboree Rd. Rental projects will still need to meet the 15% affordable housing requirement.
According to the state income limits for housing, a family of four living in Orange County would be considered low income if they make less than $148,850 per year. The Orange County limit for moderate income for a family of four is $166,300.
Newport Beach officials argue the decrease is necessary because the median value of homes in the city are almost three times higher than the median value of homes in OC and it would make it worthwhile for developers to build for sale homes in the area.
“With today’s rising construction costs and land values, the 15% Inclusionary Requirement is not financially feasible when applied to for-sale housing developments within the Overlay,” reads a staff report.
“Inclusionary housing percentages for for-sale housing greater than 6% for lower-income levels and 8% for the moderate-income level would likely render most for-sale residential projects financially infeasible to develop.”
The move has faced pushback from county airport land use commissioners and state transportation officials who argue it doesn’t align with their officials guidelines and planning for the area.
During their meeting on Tuesday, city council members voted 5-0 to approve the decrease in low-income housing requirements and override the Airport Land Use Commission — with Mayor Lauren Kleiman recusing from the vote and Councilmember Joe Stapleton absent.
Councilmembers approved the change during the meeting with no discussion.
Kleiman said she recused herself because her husband’s company has received income from the developer Intracorp Homes involving projects outside the city.
Adam Leverenz, a resident, said that the decrease in affordable housing requirements in the particular area is going to create challenges and could become costly in the future.
“It’s frustrating to continue to see the catering to the developers at the expense of the city and possibly residents who might need affordable housing to be able to live here and work in some of these lower-income jobs,” Leverenz said at Tuesday’s city council meeting.
Newport Beach has been tasked by the state to plan for 4,845 housing units by 2026, according to the city’s housing element.
That state mandate is broken down into various income categories: the city must plan for 1,456 very-low-income units, 930 low-income units, 1,050 moderate-income housing units and 1,409 above-moderate-income units by 2029.
In 2006, the city updated its general plan within the Airport Area to include housing with a mixed-use method. The area was originally planned and designed in the early 1970s for commercial office and business uses.
This is not the first time officials have decreased affordable housing requirements in the area.
To help meet Newport Beach’s state mandated low income housing goals, city officials created a residential overlay area near the airport in 2012 which established development standards for the area and required 30% of units built to be affordable for 30 years.
In 2023, city officials reduced the minimum inclusionary requirement for affordable housing from 30% to 15%.
“The 15% Inclusionary Requirement is applicable to both for-sale and rental housing developments to facilitate construction of market-rate housing and affordable for all income groups,” the staff report reads.
Of these units, the Airport Area comprises approximately 25% of the city’s planned housing capacity.
“Additionally, with today’s rising construction costs and land values, the 15% Inclusionary Requirement is not financially feasible when applied to for-sale housing developments within the Overlay,” the staff report reads.
After the city council approved a 67-unit condominium project in 2024 that incorporated the 15% inclusionary requirement, Intracorp Homes, the developer, requested the city to consider lowering the requirement for for-sale housing because the project was no longer financially viable to implement.
On Nov. 4, 2025, the city council also adopted an amendment that made it possible for the city council to initiate reducing affordable housing requirements with or without the Newport Beach Planning Commission’s recommendation.
On March 19, 2026, Newport Beach Planning Commissioners recommended the city council approve the amendment in a 4-0 vote with Commissioner Tristan Harris recusing from the vote and Commissioners Curtis Ellmore and Jon Langford absent.
Evaluations and reports made for the city in 2025 by Keyser Marston Associates, a real estate consultant firm, also found that requirements greater than proposed decrease would likely make most for-sale housing projects too expensive to develop.
Leverenz urged city council members to look towards the future during the meeting.
“Somebody is going to have to address the state mandates — it just can’t be kept putting off [and] putting off,” Leverenz said.
