April 23, 2020

Maintaining Affordability During Coronavirus

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Keynote remarks by David Bowers at Bisnow’s “Maintaining Affordability During Coronavirus” on April 23, 2020

Many thanks to Bisnow for hosting another conversation on housing affordability in our region.
 
All housing is affordable. The question is to whom?
 
Let’s assume today we are talking about households making less than 80 percent of the area median income, $121,000. Roughly $68,000 for an individual or $97,000 for a family of four.
 
Title of this session is maintaining affordability during coronavirus.

I submit we need to do a “both/and” approach.

Imagine that there were thousands of people that drowned every year. And imagine that tens of thousands of people were struggling to keep their head afloat. And imagine every year thousands of additional people fell in the water. And imagine our response was to pull out who we could. But we looked up and the numbers kept getting worse. Then all of a sudden, a massive flood hits with massive waves.  
 
Would we be surprised if more people drowned? Would we be surprised if people that were treading water started to go under? We shouldn’t be.
 
What should our response be? Pull the people that are drowning out of the water. Help the people that are struggling to tread water. Take steps to make sure more folks don’t end up in the water. Teach people to swim. Build barriers to keep folks from ending up in the water. Yes, yes and yes.
 
That is our housing situation. Before coronavirus hit – roughly 10,000 people were homeless in the region. They had drowned.  

Twenty percent of all households were paying more than 50 percent of their income for their housing – they were treading water and barely afloat.

Each year we have been losing affordable units across the region. Each affordable unit lost is one more person or family in the water. Hey – who doesn’t like a gleaming fancy condo with nice amenities, or a nice big house with a big yard?

It should surprise no one in our industry that the people more likely to be in the water are black and brown people. The resources needed to achieve equity in their housing and quality of life aren’t even part of the discussion in a real, meaningful way.

For every 100 units we lost, our response has been let’s see if we can build 5 or 10 more to fill the gap. The waters were filling up with folks struggling to stay afloat while we who are comfortable wrung our hands-on scarcity inspired “what is realistic” thinking instead of abundant “what is needed” thinking.
 
Now this virus hits. Health calamity. Economic calamity. A massive wave. We find out lots of people and families really are on the edge – unable to go more than a couple of missed checks.  
 
So yes – we need emergency responses and have seen some. A hold on evictions. A hold on rent increases. Additional rent assistance payments. Mortgage forbearance and hold on foreclosures. Adjusting payment schedules for multifamily building owners.

We need to continue to do this. And!!!  

The fundamental needs that existed before the virus hit are still there. This region needs hundreds of thousands of units over the next decade to meet current and projected need. Estimates in the billions of dollars.  
 
The good news is we have folks that know how to preserve and produce new affordable housing. We have folks that know how to finance a deal. We have policy folks that have great ideas on how to reduce costs and inefficiencies in the process. We do that work all day every day at enterprise across the country and have done it right here in the DMV region. On today’s panel you will hear from my peers in the industry about how they do it every day.
 
We have the smarts. The question is do we have the will to offer a helping hand, to invest in the wellbeing of others and our region’s wellbeing at solution-level scale?
 
When the Housing Leaders Group announced our capital region housing challenge last March at Bisnow, the goal was to see a billion dollars of net new money invested in housing affordability by the end of 2020. Half by public sector. Half by private sector. To date we’ve seen about $285m of net new money invested.
 
Some were inspired. Some thought it was crazy. Too bold. Too aggressive.  
 
Then the storm hits. The waves come. And suddenly we see that we must act or our streets would be full of people without a place to live. And it is interesting that many of the people we now deem essential are the same folks that we know are treading water each day with their housing costs.
 
Grocery store clerk. Teacher. Nurse. Truck driver. Food delivery person. We realize what we should have known all along. We are all important and worthy of support. And that person who doesn’t work in an air conditioned office wearing a shirt, tie and wing tip shoes is just as important and critical to our region’s daily wellbeing.
 
Public budgets will be hit. We must figure out how to still make significant investments in the preservation of housing affordability for low- and moderate-income households, and in the production of new units, and in rent supplements.  

Philanthropy and private investors. Yes – help emergency relief efforts like those of The Community Foundation and The United Way. And go deeper and do more – invest in the ongoing work of affordable housing developers, service providers and affordable housing policy advocacy, training and organizing groups.
 
And this time, let’s do so with an equity and reparations lens. Stop with the clutching of the pearls about the disproportionate impacts of Covid-19. White America catches a cold, black America gets pneumonia. I was told that as a child. The underlying inequities have been there since this nation was established. Let’s stop talking equity if we won’t collectively invest at reparation scale levels to bridge equity gaps in housing, wealth, health and education. From city hall to county headquarters to the state house to Capitol Hill to corporate boardrooms. We are a rich nation.  

The question is this: will we invest our money and implement policies that will not only pull drowning folks out of the water today but build systems and make investments that keep people from falling in the water tomorrow?
 
We need to do this. We can do this. Let’s do this.

Access the complete Bisnow webinarMaintaining Affordability During Coronavirus.

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