Who is affordable housing in Naperville for? September 2022 edition

Two recent proposals aim to bring affordable housing to Naperville. The first project had 401 housing units and the affordable housing units within the development would be for this group:

Photo by Michael Tuszynski on Pexels.com

While the council has not adopted any measure requiring affordable housing, Pulte designed Naperville Polo Club in response to the city’s stated priorities, Whitaker said. They are committing to sell 20% of the town homes at an affordable level based on area median income, or AMI.

“Pulte will target buyers at 80-100% Naperville AMI consistent with household income targets set forth in SB Friedman’s Affordable Housing Program,” Whitaker said in the letter. “This target demographic for for-sale housing represents household incomes of approximately $100,000 to $125,000 and translates to a home purchase price below $440,000.”

With the median household income of DuPage County at over $94,000 and Will County at over $90,000 – Naperville spans both counties – this affordable housing is only accessible to people above the lower 50% of household incomes in the counties.

The second project involves affordable units set aside for two groups who need them:

It’s not often the Naperville City Council receives a standing ovation.

But it happened Tuesday after a 9-0 vote authorizing pursuit of an affordable housing project on city land southeast of the corner of 103rd Street and Route 59 on Tower Court. As part of the potential agreement for development, a minimum of 60 units would be built for seniors and for adults with intellectual or developmental disabilities.

When the vote finished, more than a dozen audience members clad in red shirts with “I (heart) affordable housing” written on them stood and cheered the decision — more than a year in the making — that paves the way for young adults with special needs to live independently.

In both cases, housing is needed.

But, what is “affordable housing” about? Is it about keeping Napreville residents in Naperville like seniors and young college graduates? Is it about providing housing that provides no threat to larger homes and higher property values? Is it about providing units to those who live and work in wealthier suburbs but cannot easily afford to live there? Is it about providing units within a region where tens of thousands need affordable housing? Is it about providing housing for those who could not otherwise live in a wealthier suburb?

More centers for growing ethnic senior populations in the suburbs

A more diverse suburban population has contributed to an increase in community centers for ethnic seniors:

Without public transportation to get around or language skills to communicate in their suburban surroundings, many of these seniors — feeling isolated and lost — have turned to adult day care service providers that cater to immigrant communities. The number of such suburban centers with a cultural sensitivity has exploded in the last 10 years, from two in 2005 to 14 today, serving an estimated 3,500 seniors, according to Marta Pereyra, executive director of the Coalition of Limited Speaking Elderly.

Despite the growth, centers can’t keep up with demand. There are still hundreds of senior immigrants in the suburbs left home alone because the day cares cannot accommodate them, the centers’ directors say. And with proposed changes to the state program that distributes Medicaid funding to cover the cost of the care, advocates contend that droves of ethnic adults may soon lose the sense of community that keeps them from becoming a further drain on public dollars in state-funded nursing homes.

“They’re following their adult children and their grandchildren (to the U.S.) and are ending up in the suburban areas, and then they discover that these locations don’t have much in the way of services that are culturally specific,” Pereyra said. “They need to have some access to their peers, their ethnic foods, some kind of meaningful activities.”…

“For seniors in suburbs, they’re just isolated in the home. They feel useless, their self-esteem is hurt, they just feel depressed,” Yang said. “We need to give them some time and space for themselves, and we need to teach them English.”

There will be even more need for such centers as (1) more immigrants move directly to the American suburbs (and the numbers several years ago were around 40%) and (2) the American population ages. As the article notes, the suburbs presents a unique challenge for putting these centers together as they have to range wider to pull in people who are more spread out. As opposed to cultural centers in urban enclaves in the city, people can’t just hop on public transit or walk a few blocks – they need to be rescued from their private homes.

And the next question to ask is: what happens to all of these seniors once they can’t make it to these community centers and instead need more medical care or assistance?

More older Americans dealing with mortgage debt

Retirement may look quite different for many Americans who have more mortgage debt than in the past:

Nearly a third of homeowners 65 and older had a mortgage in 2011, up from 22% in 2001, according to an analysis from the Consumer Financial Protection Bureau, using the latest available data.

The debt burden also grew — with older homeowners owing a median of $79,000 in 2011, compared with an inflation-adjusted $43,400 a decade earlier.

For decades, Americans strove hard to pay off their mortgages before retirement, an aspiration that when achieved was celebrated with mortgage-burning parties…

A recent study from Harvard University’s Joint Center for Housing Studies showed that of mortgage holders ages 65 to 79, nearly half spent 30% or more of their income on housing costs. Of mortgage holders 80 or older, 61% pay that amount on housing.

This continues a trend noted last year. This is worth watching as a higher percentage of Americans are older and this particularly affects older residents in more expensive markets where housing options are not as cheap. Homeowners could have several options down the road. First, perhaps they shouldn’t buy homes close to retirement age. Unfortunately, this means they might not be as flexible in searching out new jobs. Second, they may have to sell at retirement and bank that money for future concerns. Yet, even if they can make a good return on selling their home, moving can still be a tough transition (even within a metro area as opposed to moving to significantly cheaper markets). Third, they may have to pursue other living arrangements at retirement such as renting rooms or small apartments in their dwelling to try to make some extra money.

Unintended consequences: when property values decline, seniors with frozen property taxes pay more

Programs that freeze the property taxes of older homeowners may reduce their taxes for a long time – unless property values decline and seniors end up paying more:

The state’s Senior Citizens’ Assessment Freeze Exemption works by capping participating homeowners’ property assessments. So even if the property’s value rises each year, a participating homeowner is taxed only at the level when the “freeze” was put into effect. In better times for real estate, participating homeowners in some suburban townships averaged as much as $38,000 reductions on their assessments, which would have reduced their property tax bills by hundreds of dollars. But instead of just losing out on the revenue, governments shift the tax burden onto property owners who don’t qualify for the freeze.

The law was intended to prevent fixed-income seniors from being taxed out of their homes since, to qualify, participating homeowners have to earn less than $55,000 a year.

“But nobody thought property values would decline,” said state Rep. David Harris, an Arlington Heights Republican who sits on the House property tax subcommittee. “Now, the issue is huge.”

Here’s why. If property values drop below the frozen level, there is no longer any benefit to the participating homeowner because he or she is taxed at that lower level.

That wouldn’t be a problem if the value dropped for only that homeowner. But when the value drops for everybody and the tax levies for all government bodies stay the same, or more likely increase, tax rates have to increase to meet the levies governments are allowed to collect.

The most important thing to me in this story: nobody assumed property values might drop. In other words, legislators and those receiving the tax help didn’t think about this possibility. So now they are stuck trying to scramble to find a fix.

While there are certainly other reasons contributing to the financial troubles of the last seven years or so, I wonder how much ignoring this simple idea – property values could decline for a while and not bounce back – contributed to the larger issues.

What to do with those extra years of life

Virginia Postrel addresses how American society can move beyond seeing age 65 or retirement as the end of a career or life (“Floridization”):

It’s to change the pictures in our heads, to give up the images that “Floridization” evokes, as either a warning or an implicit ideal. People do not automatically become crotchety, backward-looking, and idle when they reach their 60s.

But changing that picture means exchanging today’s architectural metaphor, “building a career,” for another one: adaptive reuse. This is the human-capital equivalent of turning industrial lofts into apartments, factories into medical schools, power plants into art museums, or saw mills into shopping centers. Your original career may be economically obsolete, or you may just want a change, but your knowledge and experience still have their charms. Instead of equating success with a steady progression of better-paying jobs, each related to the previous one, this model emphasizes taking on new challenges and making new contributions, even if that means going back to school, taking a pay cut, or starting as a trainee when you’re middle-aged.

One version of this idea is the “encore career” advocated by Marc Freedman, who has made one of the most prominent attempts to think what how longer, healthier lives should mean for Americans’ careers.

This is an important topic to be discussing with longer life spans, limited funds for government retirement programs, and economic times that may require citizens to work to an older age. Those with more years have plenty to contribute to society and to simply write them off as past their time is foolish: it is not good for these individuals, their families and communities, and society.

Implicit in this discussion is an American emphasis on youth. Postrel cites one journalist who seems to suggest that youth equals progress and that being older automatically leads to loneliness. This may only appear to be the case because our society doesn’t leave much productive space for those who have retired. As I recently discussed, being older can lead to increased happiness and wisdom, two traits out society could use.

h/t Instapundit