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Let's Talk About Affordable Housing in (Mostly) America
Quid
Definitely not a bananaRegistered User regular
Definitely not a bananaRegistered User regular
You know where people like living? Inside.
Unfortunately In America, among other places, it's getting really hard to do for a variety of reasons. A big one is the ever increasing capitalistic hellscape that views what should be a basic right as an optional entitlement. Another is places to live becoming increasingly underwater or on fire. Another still is widespread support for affordable housing only existing so long as it's somewhere else.
In the States there are also shelters and halfway houses but these are almost universally underfunded, understaffed, and at capacity almost constantly. We also have subsidized housing which can turn in to an insane tangle of federal, state, and local ordinances for people trying to live in or build.
More successful attempts outside of America have included giving people housing or giving people money to buy housing which I'm also a fan of.
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On the market side of home ownership I'd really like to see something like the VA loan become universal. No down payment, no PMI, and limits on closing costs. For renting I wish deposits would die in a fire and potential damage caused by tenants instead get covered by insurance or just be accepted as a risk.
Unfortunately In America, among other places, it's getting really hard to do for a variety of reasons. A big one is the ever increasing capitalistic hellscape that views what should be a basic right as an optional entitlement. Another is places to live becoming increasingly underwater or on fire. Another still is widespread support for affordable housing only existing so long as it's somewhere else.
In the States there are also shelters and halfway houses but these are almost universally underfunded, understaffed, and at capacity almost constantly. We also have subsidized housing which can turn in to an insane tangle of federal, state, and local ordinances for people trying to live in or build.
More successful attempts outside of America have included giving people housing or giving people money to buy housing which I'm also a fan of.
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On the market side of home ownership I'd really like to see something like the VA loan become universal. No down payment, no PMI, and limits on closing costs. For renting I wish deposits would die in a fire and potential damage caused by tenants instead get covered by insurance or just be accepted as a risk.
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Doc: That's right, twenty five years into the future. I've always dreamed on seeing the future, looking beyond my years, seeing the progress of mankind. I'll also be able to see who wins the next twenty-five world series.
Nope.
There's an upfront fee but no PMI.
Major causes:
1) Broad housing shortage, going back decades, affecting multiple regions and sectors and types of housing, across all English-speaking countries.
2) Insufficient funding for public/subsidized housing in the US. Funding for affordable housing has dried up since the 1960s, if you're looking at it either on a per-capita basis, or a % of GDP, or whatever other normalized metric you want to use. We just don't spend enough money to keep poor people housed. So on top of a broader housing shortage, we have an even worse shortage of subsidized units.
3) A slow shift of popular preferences away from single-family suburban housing towards urban multifamily housing over the last ~25 years or so. Consequently, housing unaffordability is particularly worse in denser walkable neighborhoods in hub cities. This cooled a little in 2020 due to COVID but that seems to be a bump in the road rather than a longer-term trend.
4) Construction costs rising everywhere, especially during COVID.
These causes are exacerbated by local regulations that make it impossible to build anything but detached single family houses in most of the country.
Minor contributors include collusion among landlords to fix rents, housing deliberately held off the market for speculation, other unnecessary vacancies, and conversion of housing units to short-term-rentals like AirBnBs.
the "no true scotch man" fallacy.
Would that solve the problem, or is there some other underlying issue?
It's hard to see exactly what getting rid of landlords would look like.
One thing you could say "needs to be done" if we had infinite power to enact policy would be to spend a huge amount of money paying developers to build housing and have a bunch of that be subsidized. A simple change that leads to reducing landlords is having the government buy or build many, many houses
Everything needs to be done. And it would solve nothing
Landlords aren't even much of a problem. They can be scummy sure but it's not even ideal for everyone to own all the time - the extra fees involved in purchases and the risk of losing larger amounts of capital in a down market make people less likely to move around to pursue better opportunities, and while rents do go up, so do property values and both make it more difficult to afford property to live in
I mean, not morally, morally the government builds a shitload of housing and makes housing trivially easy to get one way or another. If you make areas a mix of free housing and rentals (public and private?) and housing for private sale you probably avoid creating rough neighborhoods?
I like this, I'm going to talk to my local house rep about it.
This is useless, look at the rest of the replies and contribute or take a break.
So just landlord regulations? I can get behind that.
This makes sense as well and honestly should be a thing in rural areas to get people mingling
Remote work has a chance of cutting some of that down, since it gives people more options on where they can live. Hybrid work is unlikely to do anything about it because it seems like most hybrid jobs have one going in enough, that they end up preferring a location within a reasonable commuting distance of the corporate mothership.
I'd also argue that the lack of mixed development also really hurts things. First in that it puts what little sanely built comm unites as highly desirable and thus making them pretty expensive. Though I'll concede, maybe not always. The other way it hurts things, is that all your poorly designed communities have fuck awful traffic, which ups the demand and thus costs of the places where either traffic isn't fucking awful or at least greatly reduces people's commuting times to tolerable lengths a the very least.
Ultimately, we need to dismantle the notion that housing is an investment. Yeah, that's politically difficult but I think we can do it without fucking over existing homeowners. Over the long term, reducing the rate of growth of housing costs means that future homeowners won't get as much equity, but existing homeowners are negligibly affected.
In the meantime, there are a lot of people who need housing who can't afford it, and they need direct help in the form of rental assistance and/or public housing.
the "no true scotch man" fallacy.
@amateurhour
In very broad strokes, a combination approach of:
1) Reforming & abolishing the regulations that stymie new housing development. The most notorious of these is single-family zoning, but that's not the only one. Here's a good article about how that worked in Minneapolis.
We've been making some progress with this in the US.
2) Public housing and/or rental assistance. (I'd strongly argue both.) Private, market-rate development can't meet the needs of lower income classes. A lot of urbanists like to point to Vienna, Austria's public housing system as a model. Here's another article about it.
3) Getting unnecessarily vacant housing online and occupied. The word "unnecessarily" there is doing a lot of work; different people will have different ideas about what reasons for vacancy are valid and what aren't, or what vacancies should be left alone vs which need to be dealt with. A couple of starting points to think about that are the Vancouver, BC vacancy tax and the Barcelona, Spain empty apartment seizures.
We also need better renter protections and eviction protection, but it's not clear that those would improve affordability so much as just making it suck less to be a renter.
the "no true scotch man" fallacy.
Unfortunately, the cost to build housing in the US means that building alone isn't the answer. This is a generalization with a lot of variance, but for the most part, new housing in any metro area still going to be unaffordable to people below median income for that area.
If we're talking about building at a loss, where the builder just eats most or all of the cost, then sure. That's one reason why public housing is so important.
the "no true scotch man" fallacy.
American Gothic, what's wrong with this picture?
The regulation: the US has something called the Faircloth Amendment. It's a federal law that says that federal funds may not be used to increase the net amount of public housing in the US. It may only be used to repair public housing, or replace on a 1-to-1 basis, housing that's gone 'offline.' It effectively limits public housing to 1999 levels.
The Faircloth Amendment was passed in the 90s during Clinton-era welfare reform, but it's the modern incarnation of similar laws that were in effect on-and-off since the early 1970s. On and off from the Nixon era to the Clinton era, the US federal government only built public housing to replace previously demolished/destroyed/uninhabitable public housing.
The Faircloth Amendment has gotten some fire recently from Alexandria Ocasio-Cortez and other left-leaning congresscritters, but the sad reality is that we aren't even maintaining those 1999 levels allowed under Faircloth. We're well below the Faircloth allowances because we don't fund public housing.
Nextcity puts it well in this article: "[Faircloth] is both one of the most important obstacles to expanding public housing in the U.S., and not important at all."
the "no true scotch man" fallacy.
To be pedantic, Vienna is the capital of Austria and definitely not in Italy.
Of course it is. Brain fart.
the "no true scotch man" fallacy.
Also, just straight up ban AirBnB or regulate it to the same standards as a hotel so it's not easy money to be a slumlord.
This does not matter*. When you build new housing older housing becomes more affordable because the people who can afford the new housing leave their older housing for it.
Like; Seattle currently** has enough low income housing stock to meet the number of individuals who qualify for low income housing in the city.
What it doesn’t have is places to put the half of the people currently in that stock whose income is now too high to qualify but do not have a place to move because housing is too expensive for them . And kicking those people out in order to house the currently low income just makes different homeless people rather than fixing the problem.
So if we build more “luxury housing” this will free up the medium income places, which will free up low income places. It actually just does work like this. There is loads more with regards to how “luxury” really just means “new” and how new building has a significantly hard time making ends meet in private construction if they’re selling/renting at lower prices. It’s not like the new apartment buildings being put in in Seattle are huge spaces. They’re expensive because there is something like a 50,000 unit shortfall
*ok it doesn’t not matter but building housing is far far more important than building a specific type of housing. Public funding is really great but not so much because it builds cheap housing but because it builds any housing. Should we build expensive public housing? Well no obviously and we should build more of it. But worrying about private builders building luxury units is backwards. More units means cheaper prices. Build all the fucking ugly 5/1s. Build them as far as the eye can see. Line every Main Street and surround every train stop 5 blocks deep with ugly 5/1s and then keep going. They won’t be luxury in 10 years but they will be housing.
*ok well the last time I went and looked at the numbers which was a while ago but also i sincerely doubt things have changed significantly.
@amateurhour
Ask a dumb pithy question get a pithy answer I guess? I really don’t know what you were expecting with your question. Especially since none of the other posters had mentioned getting rid of land lords as even like… a starting point or a constructive issue. So you weren’t getting your question as part of a serious examination or response to the people in the thread.
Take your own damned break
The missing middle has been brought up, but I think that the problems run a bit deeper. Starting after WWI or so, increasingly car dependant suburbs started appearing. Initially they were still pretty dense, with relatively small houses. Oftentimes they were served by streetcars. As car dependency grew, the streetcars went away. Lot size and house size grew steadily. The size of cities expanded and density dropped. And as a result of all this, the kind of place that can only exist due to cars and cheap fuel became the norm.
Three or four bedrooms and a yard large enough for a big dog to run around is what’s expected for a family. You need space to park your personal vehicle, your spouse’s personal vehicle, and your work truck, plus a space for your kid’s vehicle when they’re old enough to drive. And of course you all need those vehicles, because you live in a suburb or exurb, where you can have the space you’re expected to have, and nothing is within walking distance. The suburbs were built on cheap gas and cheap land close to town, and continued expansion just isn’t sustainable as gas prices and distance increase. But that’s not a message most people want to hear.
This isn’t even a conservative/liberal thing. There’s no shortage of people on the left who want the American suburban dream. The idea of living in a condo or townhouse in a dense neighbourhood rather a detached home of their own just doesn’t cut it, it’s seen as taking a step back into worse living conditions than their parents or grandparents or in some cases great-grandparents. And that’s even if those condos or townhouses were available, and they often are not!
Fixing the housing situation is straightforward: build more units. Fixing the housing in a way that doesn’t involve further urban sprawl and the long term environmental and social problems that sprawl incurs? That is going to require that North Americans rethink what the North American Dream of middle class success looks like. That’s going to be a lot harder than building the missing middle. We’ve spent over seventy years seeing increasingly large homes and yards and vehicles, and “you’re going to have learn to love the benefits of a dense city” is going to be a very bitter pill to swallow for a lot of people.
And even then, legislation has to catch up to not letting things like Airbnb do as they please.
But as usual, until the Boomers holding the political positions and purse-strings die out, that shit isn't going to budge. Walkable towns and cities is like Europe, European means socialism, socialism means agreeing to let Satan eat your children. And I wish this was mostly hyperbole but it's not, that brainwashing against anything not from America is deep and strong.
And yeah, there are still people in the US who are going to want the more rural homes and whatnot but I don't see that as a problem if the demand for mid- and high-density living areas is met.
Yeah, this. I touched on that a bit here:
I like to call this "The Great Inversion," after the book by the same name by Alan Ehrenhalt. Here's an interview and short summary. The book isn't perfect, but the title gives me a pithy term for the phenomenon.
I wrote this here on PA back in 2014. So pre-pandemic. (I fixed the broken links.):
For a minute it looked like COVID might reverse this trend as WFH techies fled cities and looked for larger homes to accommodate home offices. But it's starting to look less like a full reversal and more of a partial moderation. Combined with some of the efforts we've seen recently across the US to get more urban multifamily housing online in cities, I expect the growth rate in apartment rents in hub cities to keep cooling somewhat. They'll continue to grow (most likely) but grow a little slower.
the "no true scotch man" fallacy.
I have a friend whose team office was randomly moved to a city an hour's rush hour commute away and yet they have 6 AM meetings because of time zones. Zero percent of their job is physical.
Exactly. And there's still the fact that a lot of people prefer to live in the walkable, urban neighborhoods Ninja Snarl P described. So plenty of tech workers, even when given the choice to work from home, won't move to the suburbs.
the "no true scotch man" fallacy.
I'm in favor of cracking down on hoarding, but I do think we should be realistic about how much it'll bring online. From my post earlier, just because it has links:
Let's crunch some numbers, specifically about Vancouver, BC.
They implemented their vacancy tax in 2017. Prior to the implementation, the city commissioned an ingenious study that looked at electricity consumption as a proxy for vacancy (PDF link).
Key takeaway:
10k isn't nothing, but the City of Vancouver had about 650,000 people in 2014. The greater Vancouver metro area had about 2.5m people.
The empty home tax was implemented in 2017, so the first city reports about its first-year effects were published in 2018. From Housing Vancouver (another PDF link):
Okay, so the numbers are a little different, possibly due to different methodology or just a shift from 2014 to 2017. But it still gives a sense of magnitude. 8500-10800 nonoccupied units in a city of 650k.
Of those, more than half (5200) were exempt because there was some reason they were vacant - they'd recently been sold and were waiting for the occupant to move in, were under redevelopment, etc.
From that very same report, in their section on housing targets (emphasis mine):
Even if the city appropriated all 3300 of those vacant homes (1200 declared vacant by owner and 2100 determined vacant by the city) or more aggressively just ignored the exemption criteria and appropriated all 8500-10800 vacant homes, we're still talking about a fraction of what Vancouver needed (and still needs). Sure, seize those 10k - they'd still have to build 60k more.
That's how it was. Here's how it's going. From the city's December 2022 report on the vacant homes tax (yet another PDF link):
Not great, but not terrible.
They also say that:
These are good things! I just want to emphasize that we're still talking about small fraction of the city's housing needs, and that this is a tertiary measure.
the "no true scotch man" fallacy.
And even when it is, it's often very standardized in a way that doesn't fit everyone. I just bought a SFH on a large lot. I would have preferred a smaller one but almost all of the areas small to medium size houses are detached townhomes. This means a lot of their interior space is lost to stairwells. And medically I can't handle that many in-unit stairs.
I found one condo that could have been a possibility, except it was selling for a $300,000 loss which is a giant, giant red flag.
Said condo had a $1,000 month HOA.
Vancouver BC is a high-demand, low-vacancy market. We should expect them to have low vacancy/unoccupied rates.
Usually, we see that vacancy/non-occupancy rates are much higher in cities in economic decline. The Lincoln Institute of Land Policy released a report in 2018 that I like called The Empty House Next Door (yet another PDF link) about it.
The legacy cities they refer to here include but aren't limited to Detroit, Cleveland, and Baltimore.
The report also discusses the difficulty of measuring nonoccupied properties. Personally, I think that we do a shit job of it in the US. One of the upsides of a vacant home tax like Vancouver's is that it establishes a process for identifying and counting such homes.
the "no true scotch man" fallacy.
This is technically true for a certain definition of "low-income", but I think it is a bit misleading for folks who might not know the details about how affordable housing works. And your gist includes a good point, though I'd argue it's incomplete.
To clarify for anybody reading, subsidies and tax breaks for affordable housing are divided into multiple income tiers. The top tier in the US is 80% area median income. That's the absolute highest income you can be to qualify for subsized affordable housing, and that's where a real estate developer or landlord gets the smallest tax breaks and subsidies for housing you.
For an individual in Seattle, that income maximum $70,650/yr. Any individual making that, or less, will qualify for the 80% AMI tier of affordable housing. If they aren't trying to get into affordable housing, but are just going on the market and trying to get market-rate housing, then that qualifies them for monthly rent of about $1960/mo. (Based on 30% gross monthly income.)
Just as an illustration, here is a nice pie chart showing how Seattle Office of Housing funded different projects at different tenant income tiers in 2022. It'll help folks visualize how affordable housing bureaus break down their portfolios by income:
To your point, a 2021 study, commissioned by the city, that broke out housing supply & demand by income level found this:
They also point out, further down the report, that this "does not reflect the needs of residents who have been excluded from housing in Seattle through displacement, homelessness, or inability to find affordable housing in the city" and, again in another page, "They [the gaps we estimated] do not consider additional housing that would be needed to accommodate demand from households that would like to live in the city but cannot find adequate or affordable housing."
Distilling this down to a surplus of low-income housing units is a bit misleading. This is a surplus at a particular income level, on the high end of what technically qualifies as "low income." (And of course it doesn't take into account unmet demand from people who would like to live in Seattle, but can't.) The report gives another visualization of this:
Even taking this downrenting phenomenon into account, there's still a shortage of units at 50% AMI and lower. And the report is very clear in their conclusion (emphasis mine):
the "no true scotch man" fallacy.
It is true that if you don't build enough high-end housing in a hot market, high-income people will compete for lower-end housing. And that pushes poorer people out of the market, and drives rents & prices up.
And that's a good reason why we should keep up construction of market-rate housing at the higher ends of the market. It's a good counterargument to the too-common perception that building higher-end housing is a bad thing. Research bears this out, too. A Finnish working paper and another on the US are just a couple that were easy to find from a quick search.
When new high-end housing goes up into a city, the people who move into it free up space from lower-end housing. Then other people move into that, which frees up space in even lower-end housing. And so forth.
I've only linked a couple of studies, but there are plenty others, that show that new market rate development (including new high-end development) alleviate pressure on lower ends of the market, slowing rent growth and reducing displacement. Some can be found in the citations of those papers. A few other are here, in this UCLA research roundup.
the "no true scotch man" fallacy.
I've been watching the housing market off and on the last couple years and I'm reaching the point where I'd back a nation-wide ban on HOA's. There are places I could consider getting a place even in my high-priced area, except insane HOA fees rocket the monthly cost right out of my range. Nothing light like a hundred bucks a month, but shit like $600+ a month. Unless I get an outright personal butler for that cost, that's a fucking ripoff. At a minimum, I feel like there should be a reasonable cap on what HOA's are allowed to charge, set by law.
Most HOAs aren't this.
the "no true scotch man" fallacy.
Maybe an item-based list of items judged acceptable for communal upkeep? Genuinely shared and essential things, like the items you mention here. Not shit like gates blocking off surburban communities, though.