Tag Archives: affordable housing

Sleeper issue snoozes on

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cnbcdebateWe’ve read through the transcripts of the two GOP-presidential-candidate debates held on CNBC last night, in order that — to steal one of Gail Collins’ recurrent lines — you don’t have to do it.

The two debates, of course, featured the “undercard,” with four candidates, and the “main card,” with 10.

In nearly four hours of discussion, the word “housing” was uttered once. That was when Rand Paul lambasted the Federal Reserve Board for, among other alleged malfeasances, having “caused the housing boom and the crisis…”

The candidates had nothing to say — nor were they asked by their CNBC interlocutors — about the housing unaffordability that afflicts millions of Americans, or about persistent residential segregation by race and income. And they had virtually nothing to say about the bubble-burst that ushered in the Great Recession. Maybe that’s partly because the bubble was fed by the kind of deregulation that small-government proponents are fond of promoting.

True, six of these candidates had been given brief opportunities to hold forth at a daylong “housing summit” in New Hampshire that we noted last week (here’s yet another account of that event, by the way), but it seems unlikely they were each talked out after that experience. Perhaps they, their fellow contenders, and the CNBC panel all agree with Chris Christie’s comment at the summit that housing is an unsexy issue that “kind of depresses people.”

On the other hand, the candidates talked a lot last night about other things they presumably think are depressing, such as ”big government” and taxes. One might have expected that housing could get some attention in a debate that was supposed to focus on economic matters.

Perhaps the candidates believe that their various plans for shrinking government and “growing” the economy will jump-start the private market to spur housing development, raise incomes of working families, and take care of the affordable housing problem. If so, it would be nice if they’d explain in some detail how that will work.

It would be even nicer if reporters would start making them talk about it.

 

Affordability with an expiration date

affordable housing, elected leaders, fair housing, housing, housing crisis, housing subsidies, Vermont, workforce housing, , , , , , ,

expireIf we’re going to address the housing-affordability shortage, two things have to happen. The first is obvious: more affordable units have to be built or developed. The second is less obvious: For the affordable units that already exist, insufficient as they are, affordability has to be preserved.

Preservation is necessary because affordability typically derives from public subsidies, such has low income housing tax credits, that expire – after 15 years, in the case of LIHTC. As the expiration nears, a private owner might well be tempted to convert the units to market rate or to sell to a new owner who will have no affordability restrictions. Such a sale might be particularly tempting in hot real estate markets.

A wave of coming expirations across the country prompted this ominous Blooomberg headline last week, “A lot of cheap housing is about to get very expensive.” The story drew from an Urban Institute blog post on a review of 1.2 million project-based rental assistance units around the country that found about one-third were at risk of losing their affordability status in the next couple of years. The Urban Institute researchers recommended that local preservationists (such as housing non-profits and land trusts) focus their efforts on units in “high-opportunity” or low-poverty areas, where owners’ temptation to convert to market rates might be particularly strong.

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Vermont, mercifully, has benefited from a concerted preservation effort since the late ‘80s – a combined initiative of state agencies (Vermont Housing Finance Agency and Vermont Housing & Conservation Board) that marshal state and federal dollars to provide and extend subsidies, and non-profit organizations, such as land trusts, that step in to acquire properties before they disappear from affordability ranks.

A survey last year turned up 822 units in privately owned apartments in Vermont with subsidies due to expire before 2020. An additional 1,649 units controlled by non-profits were found to be eligible for new investments, such as capital improvements or subsidy-extensions, before 2020.

Whether Vermont will be able to maintain its historically high rate of preservation for these units will depend, in large part, on the availability of public funds to underwrite the needed subsidies and investments, and the outlook for that, at both state and federal levels, is dubious.

burlingtonapt

And even if Vermont could preserve the affordability in perpetuity of all the current affordable units, there aren’t anywhere near enough of them to meet the demand. Many more affordable units have to be developed, and more public money will be necessary for that, too. That’s money that won’t be available until political leaders make housing a priority.

 

California’s sideshow

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Nowhere, seemingly, is the U.S. housing crisis more acute than in California.

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So you might suppose that here, in unassuming, modestly-overpriced Vermont, we can safely ignore what’s unfolding in California. To the contrary, it does make sense to pay some attention, for these reasons:

 

  • California social trends and public policies have a way of diffusing through the rest of the country. Not only that, middle-class Californians, in exodus because they’ve been priced out of the housing market, are moving in droves to other parts of the country and effectively bidding up housing prices in the places where they relocate.
  •  Sundry housing-affordability initiatives in California might give us some ideas about what to do here. San Francisco has a Nov. 3 election with a ballot full of affordable housing measures. Redwood City, to the south, just approved an affordable-housing impact fee over developers’ objections. People in L.A. are looking into the prospects for land trusts, something Vermonters already know a fair amount about. And as we’ve mentioned before, school districts are facilitating workforce-housing developments merely to attract and retain teachers.
  •  California generates much of what we consume here as mass-media entertainment, so we should be aware of the social context.
  •  Unavoidably, the part of entertainment value in what we’re hearing about the extraordinary California housing market, especially the one in the Bay Area, is in the form of Schadenfreude. Apparently, “there goes the neighborhood” applies when Apple employees start moving in.

Any dreams you have of moving out there should be dispelled by this short film, “Million Dollar Shack,”

a middle-class lament is filled with tales of egregiously over-priced properties, skyrocketing rents, absentee overseas investors, etc.

 

Right under our nose

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We’ve heard a lot over the last few years, both in Vermont and nationally, about how “health care is a human right.” But what about housing as a human right?

If we haven’t been hearing much about that, it’s because we haven’t been paying attention.

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Adequate housing as an international human right has been a familiar theme in the United Nations for years. In fact, it’s centerpiece of the message that the U.N.’s housing rapporteur delivers regularly to the General Assembly. The current rapporteur, appointed last year, is Leilani Farha, executive director of Canada Without Poverty, a lawyer. Her full title is “Special Rapporteur on adequate housing as a component of the right to an adequate standard of living.”

That title derives from the Universal Declaration of Human Rights, adopted in 1948, which, while not declaring housing a right per se, does say this:

Article 25.

Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services …

and this, foreshadowing the spirit of fair housing law:

Article 13.

  • (1) Everyone has the right to freedom of movement and residence within the borders of each state.

Over the years through assorted covenants and agreements, we learn by browsing U.N. documents, housing has achieved recognition as a human right.

Here we pause to note that much of the Universal Declaration of Human Rights (which is worth reading, if refresh your memory of how many rights remain unfulfilled) has been willfully ignored by many U.N. members. And of course the U.N. has negligible power to enforce compliance. (We seem to recall that the U.N. brought its “water is a human right” message to Detroit last year. How did that turn out?)

We turn now to the website of the U.N.’s High Commissioner for Human Rights:

“Increasingly viewed as a commodity, housing is most importantly a human right. Under international law, to be adequately housed means having secure tenure – not having to worry about being evicted or having your home or lands taken away. It means living somewhere that is in keeping with your culture, and having access to appropriate services, schools, and employment.

“The right to housing is interdependent with a number of other human rights: rights to health, to education, to employment, but also to non-discrimination and equality, to freedom of association or freedom from violence, and ultimately to the right to life.

Too often violations of the right to housing occur with impunity. In part, this is because at the domestic level housing is rarely treated as a human right…”

The rapporteur’s 2014 report notes that “under international human rights law, it is the State that is held responsible for the compliance with international human rights to which it is bound.” That means national governments, but also, in the case of housing, “state/provincial and municipal governments.”

She acknowledges that ”the evolving nature and diversification of the State and the multiplicity of actors who may be involved in fulfilling its obligations under international human rights law make implementation all the more complicated.”

She can say that again, in housing’s case.

 

A digital-age summit in the oral tradition

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The J. Ronald Terwilliger Foundation for Housing America’s Families held a daylong “housing summit” Friday attended by assorted luminaries and seven presidential candidates (six Republicans and one Democrat).

summit

No doubt you’re wondering what they said. You’re probably also wondering about J. Ronald Terwilliger. He is, among other things, a developer of rental apartments in Atlanta, Charlotte, Nashville and Raleigh/Durham. He established the foundation last year, the foundation’s website informs us, “to recalibrate federal housing policy to more effectively address our nation’s critical affordable housing challenges and to meet the housing needs of future generations.” The foundation’s five-member executive board, besides Terwiller, comprises former senator Scott Brown, former congressman Rick Lazio, former HUD secretary Henry Cisneros, and Harvard Business School real-estate lecturer Nic Retsinas.

Besides the candidates, who were each allotted about a half-hour in a conversation format, the event featured several panel discussions, including one on “Accessing Private Capital to Build Affordable Housing.”

Fine, so what was said of substance? Don’t ask the J. Ronald Terwilliger Foundation. No transcript was made of the proceedings. For some reason, perhaps because it’s relatively new, the foundation didn’t take any steps to “seize the narrative” of its own event. The only record of the summit is in a spotty collection of news stories and snarky commentaries.

Chris Christie got a fair amount of attention, in a Boston Globe story and a harshly critical Times blog post, but also for his Twitter-worthy remark that housing doesn’t get a lot of notice in the presidential campaign “because it’s not the sexiest issue in the world to talk about, and it kind of depresses people.”

The most comprehensive account we’ve found was an article on a TV station’s website. The Republicans (who also included Jim Gilmore, Lindsey Graham, Mike Huckabee, Rand Paul and George Pataki) acknowledged that many Americans have an affordability problem, but some tried to link that to federal regulation. The lone Democrat, Martin O’Malley, called for doubling funding for the low income housing tax credit program and Community Development Block Grants.

But we’re not going to attempt a synopsis. You’ll just have to be satisfied with the summaries you get at places like Real Estate News or Forbes or NH1 TV news, or a video clip of Huckabee, on base guitar, backing Scott Brown’s daughter, the singer. Good luck finding any account of the panel discussions.

 

Stuck in the middle

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Couple with daughter together in front yard
 

Middle-class financial struggles have occupied the public discourse for some time, but wouldn’t you know, we’re starting to hear more about housing unaffordability as a stresser for this beleaguered population segment.

The annual “State of the Nation’s Housing” report from Harvard took note this summer:

While long a condition of low-income households, cost burdens are spreading rapidly among moderate-income households. The cost-burdened share of renters with incomes in the $30,000–45,000 range rose 7 percentage points between 2003 and 2013, to 45 percent. The increase for renters earn­ing $45,000–75,000 was almost as large at 6 percentage points, affecting one in five of these households. On average, in the ten highest-cost metros—including Boston, Los Angeles, New York, and San Francisco—three-quarters of renters earning $30,000–45,000 and just under half of those earning $45,000–75,000 had disproportionately high housing costs.”

Granted, much of the news about middle-class housing unaffordability is coming out of the big cities – places where “middle income” is construed to reach far above Vermont standards. For example, Cambridge, Mass., is taking steps to reserve a share of “affordable” housing in a new Kendall Square building for families with incomes in the low six figures! San Francisco is also considering measures that would expand affordable housing eligibility and help out renters in the $100,000 to $140,000 bracket. And Portland, Ore., where the “housing emergency” is apparently wide-ranging, is looking at a form of inclusionary zoning that make apartments available to people making 100 120 percent of the median income (Up to $96,875 for a family of four).

Perhaps it’s a testament to the severity of the housing crisis around the country, and/or to the fragility of the middle-income stratum, that the terms “middle class” and “subsidy” are suddenly being spoken in the same breath.

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Here’s the thing: To qualify for most subsidized housing, applicants can’t earn more than 80 percent of the local median income. Where does that leave people who draw an average salary, or perhaps a little more? Perhaps in a place where they can’t readily afford housing but can’t get any help, either. How many such people there are in Vermont is unclear; plenty, no doubt.

(Note: Middle-income earners are not beneficiaries of Burlington’s inclusionary zoning ordinance, which aims to provide affordable rentals for people earning up to 65 percent of the median; and for sale, up to 75 percent.)

For an illustrative display of how housing costs compare to standard incomes, the National Housing Conference’s interactive “Paycheck to Paycheck” shows bar graphs for each of the nation’s metro areas – and just one in Vermont, Burlington/South Burlington. One graph compares salaries to the pay needed to afford a median-priced home; another does the same thing for 1- and 2-BR apartments at HUD’s “fair market rent.”

Below are the charts for 10 occupations that might be considered to be middle class. As you can see, eight of the 10 would be hard pressed to afford purchase of an average home in Burlington:

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They do a little better in the rental market, but still, six of 10 can’t comfortably afford a two-bedroom apartment in Burlington:

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paycheck6

 

Vermont dreaming … in California

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Vermont fantasies can take many forms, but one has to wonder: Where are the Vermont brand police when you need them? Not in California.

Consider “The Vermont,” a luxury, high-rise apartment complex in L.A.’s Koreatown that promises “sky-high decadence.” Here’s the web page’s come-on (“bask in paradise seven stories up”):

vermontcover

Hmm, doesn’t look much like Vermont (come on, we have only a handful of buildings higher than six stories in the entire state!) , so where might the name have come from? Perhaps from Vermont Avenue, which runs alongside and is one of L.A.’s longest thoroughfares.

Why that street is named for Vermont is another question. A quick Google search didn’t provide an answer, but it did turn up this 1874 photo of an area where Vermont Avenue was later platted:

vermontave1

That’s more like it.

Now, you may consider all of this off-topic for a housing blog, but bear with us…

 

 

 

There’s another curious Vermont vestige in L.A. that’s more than a century old, called Vermont Square. It’s a section of south Los Angeles (Vermont Avenue runs through it) that’s among the city’s most densely populated areas.

Vermont_Square,_Los_Angeles,_California

 

 

 

 

 

“Vermont Square” apparently was a developer’s name for what, in the early 20th century, was a huge subdivision — “the largest ever put on the market in Los Angeles,” according to this 1909 newspaper ad, “comprising fifty-two city blocks – a town in itself.”

vermontsquaread1909

That doesn’t seem particularly Vermont, either.

Back on Vermont Avenue, we learn that one of its southern segments is known as “death alley,” with one of the highest homicide rates in the city.

That’s certainly not very Vermont, so we’ll retreat to “The Vermont,” on the corner of Vermont Avenue and Wiltshire Boulevard. What are apartment rates?

A corner two-bedroom-two-bathroom suite, about 1,000 square feet, “starts” at $2,890.

vermontcorner

Finally, an unmistakable Vermont quality! Unaffordability!

 

NJ’s lessons for VT

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The Times’ Sunday editorial was a ringing endorsement of affirmatively furthering fair housing as put into practice in Mount Laurel, N.J. Mount Laurel, of course, was the epicenter of a fair housing lawsuit that resulted in state supreme court rulings in 1975 and 1983 known as the Mount Laurel Doctrine.

mtlaurel1

Essentially, the doctrine held that every town must make room for people of all incomes and can’t legitimately exclude low or moderate income people through restricting planning and zoning policies. The Fair Share Housing Center, a primary litigant in the case that led to the Ethel Lawrence Homes in Mount Laurel that’s lauded by the editorial, calls it “one of the most significant civil rights cases in the United States since Brown v. Board of Education (1954).”

That statement might sound self-serving, but it has some credence, given that other states all over the country – including Vermont – have at least paid lip service to this principle. (For a quick summary of the Doctrine and how it resonates in Vermont, check out our previous blog post on this.

One thing that was missing from the editorial was any invocation of the incisive language in the New Jersey justices’ rulings. Like this, from Mount Laurel I:

“By way of summary, what we have said comes down to this. As a developing municipality, Mount Laurel must, by its land use regulations, make realistically possible the opportunity for an appropriate variety and choice of housing for all categories of people who may desire to live there, of course including those of low and moderate income. It must permit multi-family housing, without bedroom or similar restrictions, as well as small dwellings on very small lots, low cost housing of other types and, in general, high density zoning, without artificial and unjustifiable minimum requirements as to lot size, building size and the like, to meet the full panoply of these needs. Certainly when a municipality zones for industry and commerce for local tax benefit purposes, it without question must zone to permit adequate housing within the means of the employees involved in such uses…” (emphasis added)

Those guidelines are as apt today as when that opinion was written, in 1975 – 40 years ago!

Another thing missing from the editorial was anything more than a passing reference to complexities and controversies that attended efforts to implement the doctrine in municipalities across the state. It’s a long and tangled story, and while it’s true as the Times intones that “some local officials are working diligently to turn back the clock…” and that “Gov. Chris Christie and his allies in some of the state’s wealthy towns would like nothing more than to kill this remedy…” there is an added complication in many communities, and this one has resonance in Vermont, too.

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Some of the challenges New Jersey’ Sussex County faces in providing more affordable housing, according to this New Jersey Herald account, may sound familiar here:

“ ….a shortfall of utilities — sewer, water, electric — to accommodate more housing and population; and a lack of practical public transportation in the area that limits the ability for low- and moderate-income people to get to decent-paying jobs.

“But the most glaring problem is that with the population declining and the economy volatile, the county is not an ideal place for developers to invest.”

 

We’re full, so go somewhere else

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density1When someone says that a town or a city is “built out,” what does that mean? It often means simply that the speaker doesn’t want any more people moving in – even though it might be possible to design more space, in keeping with local standards, that would accommodate more people.

The common claim that a city has run out of room reflects not a physical reality, but rather, an exclusionary prejudice, as Emily Badger suggests in a thought-provoking piece in the Washington Post. She points to widely varying population densities of major “First World” cities (Seattle, 3,000 people per square mile; New York, 4,500; Paris, 9,500; London, 14,600). How can anyone in San Francisco, even with its topographical challenges, argue that that city is “built out” at a mere 5,400 people per square mile? In fact, according a Berkeley economist, the city could accommodate 30-40 percent more people without losing its character.

Building higher and shrinking parking lots can seem reasonable as planning options, but there are limits. In Burlington (2,730 people per square mile), for example, any building higher than about 12 stories would likely be seen as excessive, and no one is ready to enforce a dramatic reduction in vehicles plying the city’s roads. There is such a thing as overcrowding, too (HUD’s so-called Keating memo calls for a limit of two people per bedroom), but of course most American communities are nowhere near their limit.

The most densely populated municipality in Vermont is undoubtedly Winooski , about 4,800 people per square mile.

winooski

And Winooski, when you meander through it, doesn’t come across as particularly dense – much of its 1.5 square miles is occupied by single-family lots, after all. It could get denser and still be less so than LA (6,000 people per square mile) or Madrid (12,100) – never mind Mexico City (25,100) or Jakarta (24,500).

Nationally, exclusionary land-use practices have had the effect of holding down housing supply and pushing up housing prices. Consider California, where housing prices began to soar above those in the rest of the country starting around 1970. One reason California diverged, according to an legislative analysis that came out earlier this year, is housing construction has been limited – by community resistance, environmental policies and other factors – in coastal urban areas. That has driven up prices there and inland as well.

The legislative analyst called for policy changes that would lead to significantly more housing along the coast. Here again, the suggested remedy for unaffordability was a familiar one: increase the housing supply. But does anyone believe that can be left simply to market forces?

Moreover, merely eliminating exclusionary policies and increasing density, while favoring more affordability, aren’t necessarily sufficient to promote inclusiveness, or integration. The pro-density strategy has to be combined with affirmatively fair housing, as Jamaal Green argues in this Shelterforce article.

 

Taller & brighter

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Once upon a time, believe it or not, planners of public housing in the United States believed high rises were a good thing. In the early ‘40s, we learn from J.A. Stoloff’s history of public housing, the thought high-rises “could provide a healthy, unique living environment that would contrast favorably with surrounding slum areas.”

Well, as we all know, high-rises for families didn’t work too well in the big metro areas. Two notorious examples in Chicago were Cabrini Green …

cabrinigreen

 

 

 

 

 

and Robert Taylor Homes…

 

KONICA MINOLTA DIGITAL CAMERA
 

 

drab, unsightly, unlivable in many ways, they unfortunately tainted the popular conception of public housing. No public-housing high-rises were built after the early ‘70s, and by the ‘90s many of these buildings were being torn down.

As it turned out, though, some public-housing high-rises did work pretty well – for elderly residents. One such example, built in 1971, is the tallest building in Vermont – 11-story Decker Towers in Burlington, operated by the Burlington Housing Authority for elderly and disabled residents:

decker

 

 

 

 

 

 

Granted, construction of ANY public housing is passe in this country, sadly, but before you stop thinking about high-rises, look at some examples in Singapore, where public-housing high-rises are home to a majority of the population. These shots are by Peter Steinhauer, a photographer:

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These photos make two things really clear: (1) High rises don’t have to be drab and dreary…sing3

 

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… and (2) no one should have any trouble finding the street address of these places.

 

 

 

The bright colors bring to mind some of the buildings in Burlington’s Old North End, many of them owned or developed by Stu McGowan …

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Now that we’ve drawn your attention back to Vermont, let’s consider building height on a Vermont scale as we also consider how to add to the state’s affordable housing stock. High rises are out of the question, of course, especially in our small towns. But what about adding a third story to buildings in town centers, here and there, for family apartments? Is that such an outrageous idea? This three-story building in the photo below doesn’t look a bit out of place.

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