Tag Archives: affordable housing

George Lucas to his weathly neighbors: if you don’t want my new studio, I’ll sell my land for affordable housing

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An interesting NIMBY battle is continuing in Marin County, California between George Lucas and his neighbors. Here is the latest:

Skywalker Properties abandoned the plans in an acerbic two-page letter [PDF] to its neighbors: “Marin is a bedroom community and is committed to building subdivisions, not business,” it read. (“It was, by his own admission, a bit edgy,” Peters says.) The letter concluded by suggesting that if people felt the land was best suited for more housing, Lucas would aim to sell it to a developer who would at least create the kind of housing Marin really needs: not more million-dollar homes, but low-income residences…

The plan, now in its early stages, is for Lucas to transfer the property to the Marin Community Foundation, which will work with a nonprofit developer to build the housing, as it has with similar low-income projects throughout the area. (Peters prefers the term “workforce housing” given the stigma attached to its more common moniker. To illustrate the perception he is up against, one wealthy neighbor cried to the New York Times that Lucas was “inciting class warfare” by inviting poor people to move in.)…

Peters would like to put about 300 apartment units on the property, which would again take up only a small portion of the remaining 200 acres. Given all the protected space around Lucas’s properties here, it’s unlikely any of the neighbors would even be able to see such a development. Most of the Marin Community Foundation’s other housing projects have been developed along transit corridors. But because this location is more remote, Peters envisions that, at first, this site may be best suited for low-income elderly. Marin also has the highest proportion of aging residents of any county in California.

Peters is quick to add, too, that in Marin County a family of four earning nearly $90,000 a year is eligible for housing assistance (for further perspective on the local housing market: “I forget that you have to translate here that a million-dollar house is not a mansion, by a long shot. They’re very comfortable homes.”) And so the popular imagination – “you’re going to bring drug dealers” was another complaint in the Times – is at odds with the reality of what affordable housing really means in this economy, and who needs help obtaining it.

It’s a strange world where wealthy people can poke each other in the eye by threatening to build affordable housing. I guess we’ll have to wait and see how the neighbors respond but I wouldn’t be surprised if they fight this with the same vehemence they fought Lucas’ plans. Clearly, more affordable housing is needed here but wealthy residents fighting a NIMBY campaign can be quite powerful.

Quiet issue: over 60,000 on CHA waiting list

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While this story is mainly about why the Chicago Housing Authority has 3,400 unoccupied units, there is another long-running issue here: the CHA has over 60,000 people on a waiting list for housing.

The CHA currently operates 20,000 properties that serve about 57,000 families, but about 3,400 units remain unoccupied. CHA’s wait list was almost 60,000 families as of March…

We are in the business of affordable housing; our goals are generally aligned with those of the (Chicago Housing Initiative),” said CHA spokeswoman Kellie O’Connell-Miller. “But from our perspective, we’re moving forward as quickly as we can. This is a multiyear redevelopment plan. The biggest challenge is the part of the plan that requires some units to come offline.”…

O’Connell-Miller said wait list standings aren’t made public because it’s not a fair assessment tool.

“It’s not a straight numbering system. Placement is dependent on family size and what bedroom need is,” she said. “The turnover varies on what the tenant needs. There are so many variables.”

The CHA is planning to take a fresh look at its Plan for Transformation this year under new leadership, Woodyard said, and welcomes suggestions and input from the community.

There are a couple of problems with this large waiting list:

1. The waiting list has been long for year and has continued to grow. In my article “The Struggle Over Redevelopment at Cabrini-Green, 1989-2004,” here is what I found about the waiting lists:

By 1984, 24,000 people were on CHA waiting lists for apartments, while another 56,000 households were waiting for CHA Section 8 vouchers…

The waiting lists for public housing continued to be long; in 2002, 48,000 families were waiting for public housing, while 38,000 more waited for Housing Choice vouchers.

2. The CHA says they are working on this issue. This might be believable if we haven’t heard similar things for decades and we haven’t seen many projects being delayed. Taking a “fresh look at its Plan for Transformation”? Sheesh.

3. The issue of affordable housing needs to be addressed on a broader scale, preferably throughout the Chicago region. Even if more affordable housing is made available in Chicago, are there good or at least subsistence jobs available in the city? Both cities and suburbs need to work on this. Unfortunately, neither the City of Chicago or suburbs have really shown a willingness to tackle this. See, for example, the contentious of affordable housing in Winnetka and Westchester County.

In sum, even if these 3,400 units were suddenly occupied, there are still over 50,000 people in Chicago looking for housing. This is an issue that needs to be addressed more comprehensively.

Some housing not so cheap when you factor in transportation costs

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Plenty of people may move to where the cheaper housing is located but this could come with higher transportation costs:

In Chicago’s transit-rich Ravenswood neighborhood, where there is an average of one automobile per household and 42 percent of commuters use transit, monthly transportation costs averaged $751 in the five-year period studied, the center determined.

Households in Marengo in McHenry County incur an average of $1,324 in transportation costs each month, the study found. Each household in Marengo, where transit ridership is less than 1 percent, also logs an average of 24,438 miles per year in their cars, versus 12,150 miles annually in Ravenswood.

When people are looking for a place to live, taking into account housing and transportation costs changes the affordability outlook significantly, said Scott Bernstein, the center’s president…

[From the print edition:] Some 69 percent of neighborhoods in the Chicago area are considered affordable under the traditional definition of housing affordability: rent or mortgage payments consuming no more than 30 percent of household income, the study said. But only 42 percent of the neighborhoods are considered affordable when housing and transportation costs are measured, it said…

The study also found that it is more difficult for a typical household in the U.S. to find an affordable place to live compared to a decade ago because incomes increased about half as much as transportation and housing costs since 2000.

This provides some data to back up Joel’s claim from earlier this week: life is cheaper (and perhaps better?) without a car.

What I find fascinating about this is that this report ties transportation costs to the idea of affordable housing. Typically, we only think about the cost of the housing itself but if you built affordable housing in the middle of a corn field 90 miles west of Chicago, those housing units won’t really help anyone.

At the same time, this is a trade-off many Americans seem willing to make: you pay less for your house and then pay more for transportation costs over time. Perhaps because the house is a significantly larger “one-time purchase” (you have repeated payments but they are somewhat fixed and you have already psychologically taken possession of the house even though you don’t own it) people can justify then paying more for transportation over time because the money trickles out and the costs are more variable. Plus, if you think of the home as one of the key pieces of the American Dream and Americans should love to drive anyway, this all could make some sense.

This is also a reminder that the cost for entry to the suburbs is not just about finding somewhere to live which often requires a sizable down payment and a mortgage. In order to get anywhere, whether it is a job or store or recreation area or church, one needs a car in the suburbs and one needs to have extra money on hand to deal with this. Without being able to pay for insurance, gas, maintenance, and somewhere to park (which is factored into a parking space or the driveway/garage that is factored into the mortgage), there is plenty of extra cost involved with having a car. This reminds me of a story I read recently about an affordable car program in Wisconsin where the state or some agency was providing cheap but reliable cars to people to help cover these growing and important transportation costs.

Argument: land restrictions lead to the American cities with the “most and least affordable housing”

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A new survey names the “most and least affordable housing” markets in the United States. Not too many surprises here. The top ten most affordable markets: Detroit, Atlanta, Phoenix, Cincinnati, Cleveland, Las Vegas, Rochester, Columbus, Kansas City, and Minneapolis-St. Paul. The top ten least affordable markets: San Jose, San Francisco-Oakland, New York, San Diego, Los Angeles, Boston, Seattle, Richmond, Providence, and Portland.

What is particularly interesting is the reason given to explain the differences in affordability:

The authors specifically call out new construction that is significantly controlled by comprehensive plans or through more restrictive land use regulations “referred to as ‘compact development,’ ‘urban consolidation,’ ‘growth management’ and ‘smart growth.’” The thesis is that these places create housing that is unaffordable. And conversely, the places ranked as affordable – Phoenix, Atlanta, Las Vegas – tend to be areas associated with sprawl development.

These two authors are known for their market-based preferences for land use and housing development, so their argument is no surprise. And though there is certainly a case to be made that restrictive land use policies can limit supply and drive up costs, these aren’t the only factors in play. That New York City is less affordable than its upstate neighbor Rochester has more to do with the fact that it is a much more vibrant and attractive city, and that people are willing to pay more to live that lifestyle than people who prefer Rochester living. Taking this and other factors into account would expand the understanding of why some places are less affordable than others. And while the picture painted by Cox and Pavletich is not wrong, per se, its limited scope offers a less-than-comprehensive analysis that could benefit from more context.

This sounds like an argument from the urban ecology school that argued sprawl could be explained by a search for cheaper land. If governments or other agencies restrict the amount of land available for development, then prices will have to go up.

This explanation also seems to suggest that the affordability sprawl allows should be a primary goal. Of course, sprawl comes with other problems including increased costs, longer commutes, more environmental concerns, and a loss of space that could have been used for other purposes or left open. If the affordability of a home was the only thing that mattered for public policy, policies would be quite different. But when doing urban and regional planning, there are a number of other concerns that must be taken into consideration.

Also: I’ve always wondered why lists of affordable or unaffordable places don’t try to overlay other data on the prices. At a quick glance, it looks like the more affordable places tend to be in the Rust Belt, the South, and foreclosure centers while the more expensive places are on the coasts. Some other factors that may matter: perhaps “creative class” cities more expensive on the whole, even controlling for other factors; demographics; the particular industries and companies located in each place; where cultural centers are located; the historical context.

Imagining the conversion of neighborhoods to multi-family housing

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A journalist imagines what might happen to neighborhoods of McMansions:

I’ve long thought with a kind of evil glee about what might happen one day to all those horrid McMansions dotting the suburbs. I visited one for a story a few years back that was three stories. It had five bedrooms — each with its own bath. These places have kitchen, breakfast room, dining room, living room, den, office and solarium.

In other words: Perfect for being split up into multi-family housing…

Enough suburban decline, and who’s to care — or perhaps even notice — about the chicken coop in the back yard?

How long before the entire front yard is a cornfield?

Somehow, thinking about this makes me happy.

Others have also suggested this idea. Wouldn’t the truly green solution to McMansion be to allow these neighborhoods to return to their original natural state?

At the same time, turning McMansions into affordable, multi-family housing would require a lot of changes to communities as well. While it may be relatively easy to convert houses, this would lead to changes for local school districts and other services. Additionally, these neighborhoods would still lack public transportation and still be set up so that walking to necessities would be difficult. This would be a much bigger project to truly transform these neighborhoods.

End of the conversation about affordable housing in Winnetka

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I highlighted earlier this year (original post in March, update in April) a public discussion taking place in the Chicago suburb of Winnetka over affordable housing. After a vote last night, Winnetka has decided to table this discussion:

The six trustees were evenly split on a resolution to take several Plan Commission recommendations off the table. Village President Jessica Tucker broke the tie by supporting the resolution to drop talks about the issue.

The Plan Commission began studying affordable housing in 2005, and in April offered its recommendations to diversify the village’s housing stock by encouraging rental apartments and coach houses, as well as sub-market rate condominium units in qualifying future developments.

On Tuesday, village trustees cited a Winnetka Caucus survey in which a majority of respondents opposed affordable housing by more than a 2-to-1 margin…

The three most controversial components of the plan were “inclusionary” zoning, a housing trust fund, and a community land trust. After being sent back to the advisory panel for more consideration, plan commissioners voted to withdraw their recommendation regarding a community land trust.

I can’t say I’m terribly surprised. Wealthier suburbs, like Winnetka, often don’t desire affordable housing because of connotations the term has with poorer residents, lowered property values, and a diminished community image.

The Winnetka Caucus Survey is interesting in of itself. As the Causus notes, “One out of every four households in the village completed this survey.” This is not exactly a representative sample although this isn’t terribly different than the percentages of people who tend to turn out for local elections across suburbs. Here is how the survey gave background for the affordable housing questions:

Beginning in 1979, the Winnetka Plan Commission identified the need for modest-priced housing for seniors,
young families, and those who work in the community. For a variety of reasons, over the ensuing years
Winnetka lost many rental units and restrictions on renting coach houses further impacted the stock of modest priced housing. In 2004, the State of Illinois enacted the Affordable Housing Act, and under it Winnetka was required to file an affordable housing plan. However, in 2005, Winnetka adopted Home Rule and asserted its rights to have local control over the affordable housing issue. That same year, Winnetka filed an Affordable Housing Plan with the State declaring that Winnetka would assert its Home Rule authority and not be subject to the State’s standards for Affordable Housing. The Village Council instructed the Winnetka Plan Commission to conduct further studies and propose a customized affordable housing plan for Winnetka. The resulting proposal from the Plan Commission includes zoning, code changes and other options to foster the availability of modest priced housing. It expands its vision to establish a program to set aside some units as affordable housing units and creates tools that bridge the affordability gap for qualified households. This Affordable Housing program is limited to multi-family units within Winnetka’s commercial districts and includes preferential access to these units for long-time residents and those who work in the community. Because of the higher affordability standards, it would not qualify for state or federal affordable housing funds or fit under Section 8 housing. The new program would engage local government – either the Village Council or an appointed agency – in housing issues, as the new administrator would determine (according to the program’s guidelines) who may live in these affordable housing units and at what cost. Resources would be required to manage the program and properties on a permanent basis (i.e. forever) and, potentially, to purchase property. Further, the program would require developers of multi-family projects to dedicate a portion of their units to the Affordable Housing program in which the units would be sold or rented at below-market “affordable” rates.

On the whole, respondents were against the village getting involved in these housing issues with 85% of respondents saying “It is not appropriate for Village government to be involved in determining who can live here and what prices can be charged for housing in Winnetka” and similarly negative responses to specific pieces of the affordable housing proposal (pages 5-10 of the PDF). Interestingly, there was also strong support (over 60%) for Winnetka needs more affordable housing options for seniors” and “Winnetka needs more affordable housing options for those who work in the community.” Providing this kind of affordable housing is more of “workforce housing” for which some suburbs openly advocate. So if people want these housing options but don’t want the affordable housing proposal run by the village, how exactly might this get done?

Despite the low number of people who completed the survey, the Winnetka Caucus Council has a long history and likely is an influential force in the community.

Two common issues in affordable housing battles illustrated in Pawcatuck, Connecticut

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A fight over affordable housing in Pawcatuck, Connecticut highlights several common issues in these battles:

1. The author suggests the development will ultimately go forward because of Connecticut’s particular zoning laws:

In the event of a denial by the PZC and subsequent appeal of that decision, Connecticut State Law 8-30g puts the burden on the PZC to prove substantial risk to public health and that those “public interests clearly outweigh the need for affordable housing; and (C) such public interests cannot be protected by reasonable changes to the affordable housing development.”

In other words, the proposed housing complex must pose a threat to the well-being of its neighbors. A mixed-use plan which calls for first floors eventually to be converted to commercial use, the proposal includes three buildings; two-three story buildings of 20 one-bedroom, 20 two-bedroom, four, three-bedroom and one, three-bedroom caretaker detached house, 89 parking spots and a playground.

This regulation about affordable housing sounds like it has more teeth than those in other states. For example,  Illinois tried to impose regulations in 2004 (read some important documents and annual reports here) but as far as I know, major changes have not occurred.

If planning commissions can’t do much about such proposals, how can communities fight back (if they desire)? I assume the typical NIMBY arguments, like traffic, might be thrown out to show the development is a danger to the well-being of the neighbors.

2. There is some mention about who would actually qualify for the affordable housing:

“We’re not dealing with low income housing, but attainable housing, Bates said. He said “civil servants that cannot afford McMansions,” like police officers and teachers.

The affordable housing formula calls for 20 percent of the units to be provided for families whose income is 80 percent of median income, 15 percent must be at 60 percent of median income with the balance at 100 percent of the median income—or market price for rents.

Interestingly, the attorney for the development (Bates) is the one suggesting it is about “attainable housing.” For worried residents, suggesting that the housing is really for teachers and police sounds much better. The subtext is that this really isn’t about bringing lower-class or poor residents into the community. On the other hand, the Connecticut regulations are tied to income. Pawcatuck had a median household income (2009 estimate) of nearly $58,000 so a household at 60% is making $34,800.

In the end, is opposition to the development about the density of housing that might not fit the community, is it about the kind of residents who might move in, or is it about property values?

(Read about another fight over affordable housing in Winnetka, Illinois.)

US government thinking of renting foreclosed homes

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Different people have different opinions about what to do with the glut of foreclosures: perhaps convert them into multi-family units, bulldoze them, or donate them. It appears the federal government might try another route: renting them.

The Federal Housing Finance Agency said Wednesday it is seeking input from investors on how to rent roughly 250,000 homes owned by government-controlled mortgage companies Fannie Mae and Freddie Mac and the Federal Housing Administration. All of the homes are foreclosures…

Converting the homes into rentals may reduce “credit losses and help stabilize neighborhoods and home values,” said Edward DeMarco, acting director of the Federal Housing Finance Agency, which oversees Fannie and Freddie.

Homes in foreclosure sell at a 20 percent discount on average, which can hurt prices of surrounding homes.

It also might meet the growing demand for rentals. Since the housing meltdown, nearly 3 million households have become renters. At least 3 million more are expected by 2015, according to census data analyzed by Harvard’s Joint Center for Housing Studies and The Associated Press.

This sounds like it could turn into a large program with a lot of moving pieces. Would these homes essentially be converted into temporary public housing?

If done well, this could help deal with a rental problem. Even before the economic crisis, a number of metropolitan areas suffered from issues of affordable housing: there simply were not enough cheaper and good units available. Additionally, there was often a mismatch between where these homes were located and where jobs were located. Could renting these foreclosures be a viable solution?

How many communities would be interested in supporting a program like this? I could imagine some interesting battles within better-off suburbs. On one hand, as the article mentions, foreclosures tend to drag down home values. On the other hand, having the federal government actively involved as a landlord in more neighborhoods would make a lot of people nervous.

Problems at the DuPage Housing Authority

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As part of a story about corruption at the DuPage Housing Authority, the Chicago Tribune provides an update on the recent history of the organization:

But investigators have asked plenty of questions lately about how DuPage housing officials spend the $22 million in federal funds they get annually.

Since 2009, the U.S. Department of Housing and Urban Development has audited the DuPage Housing Authority three times, concluding the troubled agency violated numerous federal regulations and must pay back $10.75 million in misused tax money.

HUD has determined DuPage must repay that money to its Section 8 housing program because it didn’t allow competition for projects, failed to properly document whether many tenants were eligible to get subsidized rent, made inappropriate credit card purchases and, in some cases, overpaid benefits.

This is not a whole lot of federal money, particularly in a county with a population over 900,000 and a poverty rate of around 6% (this site has 2009 figures of a poverty rate of 6.5% and the 2008 Census had an estimate of 5.8%). But the DuPage Housing Authority has an interesting history. If I remember correctly from research I have done, the group was formed in the 1940s and had some federal money to work with. But by the early 1970s, the Housing Authority had not built any units within the county and HOPE, an organization now in Wheaton, sued the county for housing discrimination, primarily for exclusionary zoning practices. The court case, Hope v. County of DuPage (the 1983 version here), lasted for over a decade and here is a brief summary of the conclusion in a law textbook.  It is only within recent decades that the Housing Authority has developed units.

This is perhaps not too unusual considering the political conservatism of a county that has been solidly Republican since the the 1860s. But as the lawsuit from the early 1970s alleged, the county has continued to change: more immigrants and minorities have become residents, housing values went up, a number of communities limited construction of apartments, and there are a good number of lower-paying jobs in wealthier communities. Add this all up and there are affordable housing concerns within a wealthy county and this extends beyond the common suburban debate about “work-force” housing for essential government employees like teachers or policemen or providing cheaper housing for young graduates and/or older residents.

Update on affordable housing debate in Winnetka

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The Chicago Tribune reports on Tuesday’s meeting in Winnetka regarding a proposed affordable housing ordinance. Here is how the comments at the meeting were summarized:

Rick McQuet, a Winnetka resident, said at the meeting that the affordable housing plan is intended to help young families and recent college graduates.

“That young family was me about 15 years ago, a new degree in hand and aspirations of becoming a member of a truly great community,” he said.

Northfield resident June O’Donoghue received applause after she said she opposes the proposal because it interferes with the housing market.

“Housing is affordable to the people who can afford it. That is a simple thing,” O’Donoghue said. “I think you need a referendum for people to vote to see if they want to go through all this social engineering.”

In recent weeks, the plan’s opponents have said it amounts to “hand-outs” for people with lower income that could result in Section 8 housing, decreased property values and increased crime. Supporters have lashed out at the opposition as bigoted, arguing that the plan would allow teachers, clergy and other employees to live in the community in which they work.

Some thoughts about these comments (which may or may not represent everything that was said at the meeting):

1. The first comment I included above is interesting in that it refers to a common understanding of affordable housing in suburbs: it is not about helping the disadvantaged in society but rather “young families,” “recent college graduates,” and often elderly residents of the community. While this may be a good goal for a community (particularly if residents want their own family members in these categories to live in the community), this is a different understanding of “affordable housing.” Perhaps this is what has to be done in many suburbs order to counter the plan’s opponents who are quoted as saying this is really about helping lower-income people. But overall, there are needs for cheaper housing in society beyond people who might fit a profile of a community but simply don’t have the money.

The plan seems to play to this more suburban understanding of affordable housing:

The proposed plan would apply to new developments, in which 15 percent of owner-occupied units must be affordable to households earning at least $75,000 per year, while 15 percent of rental units would be affordable to those earning at least $45,000. Current residents and senior citizens would receive priority, the plan says.

According to the Census, the 2009 median household income was $49,777 so the part of the plan for people making at least $45,000 is still drawing from near the top 50% of American incomes.

2. “Social engineering” is always an interesting term to think about. In finishing my taxes for this year, I was reminded that our tax code is riddled with all sorts of “social engineering” in terms of promoting or incentivizing certain activities. We as Americans value homeownership so we have a home mortgage interest deduction (which some argue should be taken away). We give deductions for giving money to charities. Is all social policy “social engineering” or just policies that some people don’t like?