Michael K. pre-empted me on touching on this topic of “what is affordable housing?” After reading David Howard’s “explanation” of what he thinks HOMES means by saying Alameda needs to build more affordable housing, I also came to the same realization as Michael K, that we are “talking past each other.” This is an important topic because it is the basis of a lot of misunderstanding and innuendo.
So, what is affordable housing? Well, the Department of Housing and Urban Development (HUD) says:
The generally accepted definition of affordability is for a household to pay no more than 30 percent of its annual income on housing. Families who pay more than 30 percent of their income for housing are considered cost burdened and may have difficulty affording necessities such as food, clothing, transportation and medical care.
What David Howard points to on his blog through a spreadsheet are income limits as set by HUD to determine eligibility for subsidized housing. Michael K. has helped clairify the issue by giving definitions to the terminology that has been haphazardly thrown around by folks on both ends of the debate.
…[T]he term “affordable housing” has also come to be applied to programs and policies that make housing units available for sale or rent below the market rate. The most common affordable housing programs are subsidies, where taxpayer dollars pay some or all of the costs of housing. The most common policy is inclusionary zoning, where developers are required to make units available for sale or rent at below-market rates.
To further expand on Michael K.’s definition, some subsidies include Section 8 housing vouchers, also called housing choice vouchers. Section 8 vouchers can be either project based or tenant based. Tenant based vouchers are ones I think most people are familiar with, these travel with the tenant to help offset the cost of market rate housing so that the tenant pays no more than the 30% of their income to housing, therefore making their housing affordable.
Project based Section 8, ties the Section 8 subsidy to the actual building, or rather unit itself. This is one of the many funding mechanisms used by non-profit housing developers to build below market rate housing (aka affordable housing). The viability of the Section 8 program has been threatened by this administration and even if it were not, would not solve all the problems of housing affordability, particularly in the SF Bay Area.
Other subsidies include public housing, welfare to work, shelter plus care, etc… While all of these subsidies work well for folks on the very bottom end of the economic scale, defined by HUD as “extremely low, very low, or low” or some variation on that, it is not particularly beneficial to those generally classified as “middle-class.” Oakland has a slightly different method of classification than Alameda, but both use the same HUD numbers.
From what I understand, HOMES is saying, it’s great that Alameda will build below-market rate units (either rental or homeownership) for families in the moderate, median, low, etc… range, but what about the people who aren’t in those categories. The people who don’t — and shouldn’t — qualify for the government subsidized housing. Those middle class families deserve housing that is affordable as well and one way to help is by building a variety of housing options and increasing density, because, as Michael K. explains:
The problem here is that the major cost of a home in the Bay Area today is not the house itself, but rather the land upon which it sits. Given the high land values and cleanup costs at Alameda Point, the only hope for providing market-rate starter units is to reduce the land cost per unit. The way to do this is with multi-family housing: apartments, town homes, and condominiums.
Pro-Measure A folks point to Alameda’s high rate of renters to either prove that (a) Alameda is affordable or (b) there are lots of multi-family housing. But to me, a high rate of renters means that there is a much lower rate of home ownership, which means that Alameda is not at all affordable. In 2004, the California Budget Project put out a study called: Locked Out, which determined:
California’s 2002 homeownership rate of 58.0 percent was the fourth lowest in the nation,behind the District of Columbia, New York, and Hawaii. The homeownership rate in California is about 10 percentage points below that of the nation[.]
…
California’s homeownership rates are lower than national ownership rates largely due to the state’s high cost of housing. Nationally, 57 percent of households could afford to purchase the median-priced home in 2002, compared to just 29 percent of California households[.]
…
Young families – those headed by individuals in their twenties and thirties – are much less likely to be homeowners than they were two decades ago. The share of individuals in their twenties that owned homes dropped 13.9 percent, from 31.0 percent to 26.7 percent, between
1979 and 2002… Homeownership among thirty-somethings dropped even more dramatically during the same period (21.6 percent), from 61.0 percent to 47.8 percent.…
Only households headed by persons age 65 or older have enjoyed increasing ownership rates. The percentage of seniors owning their homes rose 15.7 percent, from 67.0 percent to 77.5 percent, between 1979 and 2002.
And what does CBP say is at the root of the growing unaffordability of housing?
Lack of supply, particularly a lack of rental housing, contributes to California’s steadily increasing home prices and rents.
…
Multifamily construction, in particular, has not kept up with projected need. In 2002, multifamily housing was only about one-quarter (26.2 percent) of total new construction (43,896 units) – down from nearly two-thirds in 1970 (124,348 units). Multifamily construction has remained below 30 percent of total housing units constructed since 1992[.]
The CBP produced a neat little chart showing what you need to be able to afford to buy a house in the Bay Area:
There is a whole other layer to the “affordable housing” debate regarding equity building and breaking the cycle of poverty, which I might get into at a later time, but definitely something to consider when we are talking about homeownership opportunities and affordability.
So, when we all talk about “affordable housing,” let’s use the same definitions, rather than spinning each other’s words to mean something that they never intended it to mean, because I think we all can agree that regardless of your income level, we all need housing that is affordable.
This is what I hear most of you folks saying – because _you_ can’t afford to buy a house, there’s an affordable housing problem, and therefore we have to look for someone or something to blame.
“Affordable housing” is normally taken to mean the very low, low and moderate income categories (relative to median income) as defined by HUD and State of California Health and Safety I reproduced in the table on my blog.
What Lauren has talked about, and what “willy” has talked about, is a “missing rung” in the price ladder above those levels.
What HOMES is doing is quoting “affordable housing” as means to fill that missing rung. i.e. “affordable housing for people that don’t otherwise qualify for affordable housing.” This is reprehensible on HOMES’ part – speaking to the poor but providing for the better off.
Housing is expensive all over the Bay area – people are facing this same problem in every city in the Bay area – even in cities that, golly gee, don’t have a restriction like Measure A. The high cost of home prices in Alameda, and the Bay area, is a function of market forces, not Measure A.
Under Measure A, one could, for example, build a duplex and a single family home on a 6000 square foot lot (one dwelling unit per 2000 feet – that’s what the rule is.) Measure A doesn’t proscribe a minimum lot size of 2000 feet, nor does it proscribe that all homes must be single-family 3500 square foot monsters. (If that’s what developers are building, it’s because people are buying them.)
Prices will always be high in Alameda (and the Bay area) because of our climate and our proximity to jobs, Silicon Valley, San Francisco.
If you start vertical sprawl – building upwards – you’re just going to get a lot of condos that are still priced out of your reach. Just look at Oakland and San Francisco.
I first moved to Alameda in 1996 and rented. I moved away and moved back in 2004 and bought. I’m a ‘newcomer’ to Alameda, not a long-time resident, and I own my home. And I don’t look for scapegoats to blame for what I don’t have.
Comment by keepmeasurea — September 15, 2006 @ 1:19 pm
keepmeasurea has suggested elsewhere that “‘progressive liberals’ . . . don’t like to think that markets take care of themselves, and we always need some kind of government or other higher authority intervention.” The trouble with these liberals, he alleges, is that they “don’t want markets to adjust themselves; current residents need to risk what they enjoy about Alameda so non-residents might get a piece too; we should add ‘vertical sprawl’ and look like Manhattan; and it’s OK if we do that under the guise of helping the poor.”
There are so many things wrong with this that I’m not even sure where to begin.
First and most importantly of all, I cannot believe that someone is trying to invoke the free market in defense of Measure A. Of all the arguments one could make, this one has to be at the very bottom of the barrel of plausibility. Measure A is a market restriction, and a particularly draconian one at that. It says no multiple units, anywhere, under any circumstances, ever. This goes far beyond the market restrictions found in most cities’ zoning codes.
No self-respecting Libertarian or other free marketeer could possibly argue that the government has any business telling people what kind of structures they can build, beyond perhaps a few bare minimum concessions to the most pressing issues of public safety.
The minute you state your support for Measure A, you are implicitly agreeing to the proposition that government intervention in the marketplace is appropriate and desirable. If keepmeasurea truly believes that markets always “take care of themselves” without “government or other higher authority intervention,” then why not completely repeal Measure A and let market forces drive the development of Alameda? If multiple units are so bad and market forces work so well, then surely none will ever be built!
Second, the use of the term “vertical sprawl” is fine example of contorting words beyond recognition in the service of politics. “Vertical sprawl” is a contradiction in terms, an oxymoron. Although there are varying definitions of sprawl, all of them refer to (horizontally) spread-out land use patterns. “Vertical” is not “spread out,” no matter how you slice it. This isn’t mere linguistic nitpicking, either, because the spread-out nature of sprawl is the very quality that gives it most of its negative connotations.
I will not even attempt to address the aesthetic, cultural, social, and health issues related to sprawl, because it can be argued that they are subjective matters of personal choice. Although it is possible to have meaningful and productive discussions about subjective concepts (”small-town feel,” anyone?), to do so here would only distract from the looming objective issues.
The objective environmental problem with sprawling developments is not that people live there or even that people drive cars there, but rather that they consume and pollute so much more per capita. There is ample evidence that denser development can mitigate the objective environmental impacts of sprawl; for just one example, consider the study “Measuring Sprawl and Its Impact”:
Although one can have a legitimate discussion about “how dense is too dense” for Alameda or any other community, a misleading oxymoronic term like “vertical sprawl” contributes nothing to that debate.
Finally, the allegation that HOMES and others who would consider any modifications to Measure A are somehow deceptively operating “under the guise of helping the poor” is patently false. For example, here is the third entry in the frequently asked questions (FAQ) section of the HOMES Web site:
If HOMES is supposedly hiding the fact that it supports the construction of market-rate housing for those who earn too much to qualify for subsidized housing, why would it state this so clearly and prominently on its own Web site?
The only one claiming that HOMES’ stated mission is “building ‘affordable housing’ for the poor” is keepmeasurea himself. HOMES certainly supports the construction of housing for people of all incomes, including the poor, but this is just one of the many issues that the group has raised in the ongoing discussion about Measure A. To suggest otherwise comes off as a desperate attempt to redefine the debate by putting words in the mouths of one’s opponents.
Comment by Michael Krueger — September 15, 2006 @ 5:39 pm
Lauren’s Note: I warned you about this previously. Do not use this blog to further your own agenda. Willy commented on your site, address issues with him there. I noticed that you put the comment in a more appropriate location now, all I ask is that you not hijack entries for your own benefit.
Comment by keepmeasurea — September 15, 2006 @ 6:04 pm
Lauren – your comments are confusing, they look like they come from me.
I don’t know what you’re talking about re: warning about this previously.
I approved comments to my blog from the opposition. What I posted re: Willy is relavent to the discussion here.
It looks like you are trying to censor debate.
Comment by keepmeasurea — September 15, 2006 @ 7:27 pm
Michael – you keep distancing yourself from people whom I would otherwise are in support of the HOMES cause.
Is it safe to assume that there is in fact a small number of people – enough to count on two hands – that are actually HOMES supporters?
As for HOMES espousing the need for affordable housing – I’ll find the reference, but the HOMES line that I’ve seen goes something like this: “affordable housing for those that wouldn’t otherwise qualify for affordable housing.”
Comment by keepmeasurea — September 15, 2006 @ 7:29 pm
Michael – if you try to understand the language of the Measure A legislation, you will probably see that it is a fair and reasonable market restriction.
The meaning of Measure A has been mis-represented in this forum, and in the local press many, many times.
Such restrictions abound across all markets.
As for “vertical sprawl”, the term is self defining – “sprawl” meaning spread-out, and upwards, rather than horizontal. You’re stretching.
Comment by keepmeasurea — September 15, 2006 @ 7:38 pm
Much has been said to try and lay claim to why the Bay Area is as expensive as it is. The classics go something like this: ” Silicone valley and those high-paying jobs”, The great climate.” ” The culture” and so on.
As someone who has lived in no less than 5 diffrent cities across the country, I can honestly say that every single area is as unique and interesting as the next place. People, culture, food, heritage, and weather are all diffrent and depending on your tastes- appealing in many ways.
Why is the Bay Area so expensive? is due to the weather? Well.. Greenich Conn is one of the most expensive places in the country. So is New York, Ann Arbor MI, and Juneau Alaska. Each & every single one of these places have severe winters with below zero snowstorms. Then it must be the jobs… right? last time I looked, the median income in the BA hovers at around 50-60k, which as anyone here will honestly tell you will NOT allow you or your family to buy a home in the currrent housing market. Also- SV has been losing around 3% of it’s workforce per year to outsourcing and industry streamlining. A lot of these jobs wind up in India, China, and places like Raleigh NC and Atlanta. GA. So then what? The culture? yes… there’s culture here allright. Lots of fun festivals you can go to, etc etc.. But I just talked to my folks in NC and they just got back from an all weekend bluegrass and jazz festival, one of only a few local events that weekend.. in the heart of Boone, NC. Once more, another claim to reasoning as to why the BA is so pricey; it’s culture isn’t at all specific to this region as if it has the key to unlocking delectable delights that only people in the BA have access to. Indeed, many places in the country- if not most- can lay claim to their own vast assortment of goodies.
My take, as mentioned from the start of this interesting topic is that legislation causes prices to be high. First you have state-w0de laws like Proposition 13, a law that steals from our schools and iniatiated an era of limited housing availability- in other words, ” grandfathered” housing. Secondly, the myriad of local laws like Measure A, further supressing the supply. lastly, the paranoia associated with citizens, whom after slaving away for decades for their tiny piece of pie, and after having to fight tooth and nail to get it will in turn join the machine to prevent future growth that in their minds hampers their supposed perfect plot of precious land.
People claim how wonderful it is here and how that they feel that paying most of their income on an old home is worth every single penny. If that’s the way you feel, then that’s fine. But don’t make the claim that the BA is better than other areas. I’ve been to these other areas and know what kind of a life you can have somewhere else… and it doesn’t involve paying an arm and a leg for it either.
Comment by Willy — September 19, 2006 @ 3:02 pm
Then, Willy, I have to ask the obvious: why don’t you live there?
Comment by NIMBY — September 19, 2006 @ 4:12 pm
The answer is that I have a great job that I enjoy, friends, a great rental house with a massive yard that costs about 1/4th of what it’d cost to buy, and I am involved with a number of community organizations.
But none of these have anything to do with the area. They are not unique to the area and like everyone else, my situation is unique only for myself.
But I am concerned for the community, the future, abd future residents. I don’t doubt that home prices are on their way to a nice robust crash,but even then, I would hope that someday California can solve it’s rampant cycles of booms and busts more carefully. This starts with adressing the issues and avoiding using folklore and unfounded hype- like” everyone wants to live here” etc etc. I’d rather focus on the facts and not the fiction.
Comment by Willy — September 19, 2006 @ 4:45 pm
Regarding Nimby comment under Robertoralize comment #14. I decided to move my rebuttal comment under a measure A thread since it doesn’t have anything to do with Don Roberts.
Even if the new housing isn’t affordable to everyone…the increase supply and may make some of these older house more affordable. My first house in Seatle need work and that is were I had to start.
Go on to the Remax web site and look at some of the houses in Almeda, many of the need a lot of work or are very small and look how much they want for them…I was shocked. When I bought my house at Bayport, you could buy a new house for less than what some of these people want and you don’t have to do all the home improvements. The price of a house in Alameda is ridiculous and a lot of it has to do with people wanting to live here and there is no supply.
In San Francisco Lamar is building Condos on Hunters Point and the affordable housing is going to start at $120,000…although there is going to be only 58 of them out of 1,200 in this 1st phase.
The US population just pasted 300 million and is predicted to be 400 million by 2043. Where are all these people going to live? We need preserve our farm lands…so the only place to put them is in the Cities which are already here. Alameda is going to grow, needs to grow, it is the responsible thing to do. We need to conserve the farmland we have left especially in California which is the #1 supplier for the nation.
Smart growth is the only answer. I went onto the smart growth website which has a link from this website and I was totally impressed with the new way people are thinking.
Comment by Joe — October 18, 2006 @ 5:23 pm