Community Developments: Reports on Supply Expansion & Cost Containment Strategies + Shortage of Affordable Housing
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- Given the tremendous ongoing demand for affordable housing, increasing the supply of affordable homes through new construction and preserving existing homes that are affordably priced are critical. Yesterday the Enterprise Policy Development & Research team released a new white paper, Proven Local Strategies for Expanding the Supply of Affordable Homes and Addressing Cost Challenges, which highlights proven local strategies for boosting the supply of affordable housing and reducing costs. It draws on the successes of some of the country’s most expensive areas to offer options to communities working to address the scarcity of affordable homes and the rising cost of development, focusing on four key strategies: leveraging existing assets, creating public funding opportunities, utilizing land use controls and improving the approval process. This white paper, which builds on recent Enterprise cost containment research, was informed by the High-Cost Cities Housing Forum’s 2018 convening, which focused on strategies for containing the cost of housing development. Learn more about the white paper in Enterprise’s blog post.
- In order to afford a modest two-bedroom apartment in the U.S., renters need to earn a wage of $22.10, according to the National Low Income Housing Coalition’s Out of reach 2018 report. This “housing wage” of $22.10 is nearly $15.00 higher than the federal minimum wage of $7.25 per hour. The report, which breaks down and maps its Housing Wage data by state, metropolitan area and county, points out that in no jurisdiction can a worker earning the federal minimum wage or prevailing state minimum wage afford a two-bedroom rental home at fair market rent by working a standard 40-hour week. According to the report, a renter earning the federal minimum wage would need to work 99 hours per week to afford a one-bedroom rental home at Fair Market Rent and 122 hours per week – that is, three full-time jobs – to afford a two-bedroom. (NLIHC, June 13)
- Yesterday the Seattle City Council voted 7-2 to repeal the city’s newly enacted employee hours tax, which would have raised about $47 million annually to fund affordable housing. Last month the city council voted unanimously and Mayor Jenny Durkan signed the “head tax” into law to charge businesses making $20 million a year or more in gross revenue $275 per employee, yet it was repealed yesterday due to overwhelming big-business opposition. (NPR, June 13) According to CityLab, opposition to the tax was advanced by a new business-backed non-profit, No Tax on Jobs, which had collected 45,833 signatures — far greater than the 17,000 they needed — to put a head tax repeal on the November ballot. (CityLab, June 12)
- According to an article in The New York Times, New York City has committed $500 million to construct thousands of affordable senior housing units on vacant public housing land, including lawns, parking lots and unused land at New York City Housing Authority (NYCHA) developments and other public locations. The article points out that there are 207,000 families on the wait list for NYCHA public housing units, and there are currently more than 58,700 people living in shelters across the city, noting that the plan would help address these challenges. (The New York Times, June 13) In 2017, Enterprise released a report, Public Benefit from Publicly Owned Parcels: Effective Practices in Affordable Housing Development, which identifies leading practices and recommendations for overcoming challenges to creating affordable housing and other community benefit facilities on publicly owned parcels.
In Case You Missed It
- Grounded Solutions Network and BWB Solutions, in partnership with Freddie Mac, have released a report, Assessing the Feasibility of a Shared Appreciation Loan Fund Designed for Long-Term Sustainable Affordable Homeownership, which explores whether a combination of public, private and philanthropic financing, rather than grants, can be deployed as shared appreciation loans to expand shared equity homeownership. It looks at the feasibility of providing for-profit and nonprofit shared appreciation loans -- secondary financing typically used to bring down the original mortgage amount, rather than amortizing monthly payments, requiring the debt in full upon the resale of the property -- on a national scale to increase access to homeownership for low- and moderate-income households and preserve affordability of properties over the long term. (Grounded Solutions, May 2018)
For the latest housing and community development news and notes, follow the Enterprise policy team on Twitter: @E_Housing Policy and subscribe to the Capitol Express Newsletter. The Enterprise Public Policy team works to safeguard, expand and improve programs that end housing insecurity. Learn more about our public policy efforts.