An Affordable Housing Boondoggle

Thanks to its urban-growth boundary, Denver has a housing affordability problem. Apartment rents have increased by 65 percent in the last decade, while the nationwide cost of living in that time rose by just 18 percent and rents nationwide increased by an average of 28 percent.

One of the city’s responses was to create a housing voucher program for people who earn too much to qualify for federal housing vouchers but still can’t afford rents in the city. Last July, it allocated $1 million to the program which was supposed to help 125 families.

So far just three households have been able to use it. Out of the million dollars, $180,000 went for administrative overhead, which is a lot of money for just three renters. Continue reading

Rolling Homeless Shelters

Transit advocates have a new reason to justify subsidies to public transit: transit vehicles provide shelters for homeless people. San Jose’s perennially cash-strapped Valley Transportation Authority is proposing to cut its only all-night bus route, but homeless advocates are protesting the plan because the buses are “another lifeline” to homeless people. The night-time buses cost taxpayers half a million dollars a year, money that could probably be more effectively spent on behalf of either homeless people or transit riders.

In Minneapolis, the Green Line light rail, which runs all night, has become the shelter of choice for 200 to 300 people seeking to escape the winter’s cold. Heartless people who have their own homes complain that the homeless people make light-rail cars overcrowded, filthy, and smelling of urine, so much so that Metro Transit has had to add four staff members to clean the cars every morning. Some suggest that Metro Transit should stop running the trains from 2 am to 4 am to keep homeless people from using them overnight, but homeless advocates object that such people “need our help.”

The link was strong even levitra cialis viagra after considering other factors associated with impotence – such as smoking, drinking alcohol, diabetes, high blood pressure and bad effects of certain drugs. The most encouraging part from the group was that they improved their blood glucose purchase generic viagra level is gained. CBT is performed by viagra without prescription free a licensed therapist – a reputable practitioner that your main physician can recommend – and focuses on changing the pondering and behavior from the nervousness sufferer. Feeling commonly begins to return within a viagra prescription canada few weeks and the numbness might be entirely gone after several months. While there are several different causes of homelessness, the problem is clearly worsened by growth-management planning that makes housing expensive. One study estimates that a 10 percent increase in housing prices results in a 14 percent rise in the rate of homelessness. A study released last month in Oregon concluded that “high rents are to blame for the severity of the state’s homelessness crisis.” Continue reading

Regulating Affordability

Two recent op-eds illustrate the dilemmas lawmakers face when dealing with unaffordable housing. The first explains to readers on Capitol Hill how Oregon is pretending to make housing more affordable when in fact almost everything it does makes it less affordable.

The article points out that in 1971 Oregon’s then-governor Tom McCall told a national group, “We want you to visit our state, but for heaven’s sake, don’t move here!” To make sure they didn’t, the Oregon legislature passed and McCall signed a 1973 land-use law that ended up limiting all urban growth to less than 1.2 percent of the land in the state. Naturally, developable land has become expensive and housing has become unaffordable, which helps keep people from moving to the state.

The article suggests, however, the state officials must be disappointed that Washington has made itself even less affordable despite not passing a similar law until 1990. As a result, many of the efforts made to provide “affordable housing” must be viewed as ways “to prevent a flood of Washingtonians from moving into more affordable Oregon.” Rent control, which every economist agrees makes housing less affordable, is only one of the ways the state is doing that. Continue reading

Killing the California Dream

Californians need to give up on their dream of a “ranch-house lifestyle” and an “ample backyard” and the state should become “more like New York City,” writes LA Times columnist George Skelton (reprinted in the Mercury-News and East Bay Times in case you run into the LA Times paywall). After reading his article, the Antiplanner has just one question: Why?

Skelton argues that California’s population has grown in the last 70 years and is still growing. But he doesn’t seem to realize that the vast majority of the state is still rural. The 2010 census found that urban areas covering just 5.3 percent of the state is urban and houses 95 percent of the state’s population.

In 2000, California conducted a housing supply study titled Raising the Roof. The full text of the study is no longer available on the California housing department’s web site, so I’ve posted it here. Chapter 3 assesses how much land in each county is available for development, data summarized in exhibit 13 (previously cited here). Continue reading

Affordable Housing at $530 Per Square Foot

Last year, Portland’s Metro persuaded voters to raise their property taxes (which will make housing less affordable) so Metro could sell $652.8 million worth of bonds that could be applied to so-called affordable housing projects. The first such project will be the Mary Ann, a four-story apartment in Beaverton.

The apartments will actually be built by Reach Community Development, a non-profit housing group that is using low-income tax credits to pay nearly 55 percent of the $20.9 million cost. Metro will provide another $3 million, so Reach only has to recover $6.5 million from rents or sales in the building. Continue reading

Infill Won’t Make Housing Affordable

The Portland Planning Commission has approved a plan to rezone almost all of the city’s single-family neighborhoods to quadruple the current densities. Planners claimed that this would make housing more affordable by allowing the construction of tens of thousands of new triplexes or fourplexes in the next few years.

Internal documents, however reveal that the planners’ own projections are that this change will lead to fewer than 4,000 new housing units. Moreover, most of those units will be in poor neighborhoods, resulting in the displacement of low-income families by people who can afford to live in new, higher-cost housing.

Fourplexes won’t solve housing affordability problems because Portland’s urban-growth boundary makes land prices high. Quadrupling densities won’t help if the land itself costs four times as much as in urban areas that don’t have growth boundaries. Continue reading

The Deflating Bubble

According to data released last week by the Federal Housing Finance Agency, home prices have peaked and are beginning to decline in many urban areas. Since 2018 prices in some urban areas had grown to be greater than at their peak in the 2006 bubble, it is fair to say that we have seen another bubble inflate and begin to deflate.

The above chart shows home price indices adjusted for inflation using GDP deflators for six metropolitan areas whose prices have been made volatile by growth management. Late-2018 prices in San Francisco and Seattle (as well as San Jose and some other areas) were considerably higher than in 2006, even after adjusting for inflation. Now they appear to be declining. Continue reading

Keeping People Out of Oregon

“We want you to visit our state,” said Tom McCall, Oregon’s best-known governor, “but for heaven’s sake, don’t move here.” To “preserve Oregon,” he signed the 1973 law that led to the urban-growth boundaries that confine nearly all development to less than 1-1/4 percent of the state. McCall never admitted it, but by making housing expensive, this effectively discourages people from moving here.

Today, Oregon leaders must be chagrinned by the fact that Washington has outplanned Oregon. The Johnny-come-latelys up north didn’t pass their growth-management law until almost two decades after Oregon, yet Seattle housing today is considerably more expensive than Portland’s. According to Zillow, the median Seattle-area home is worth almost $100,000 more than one in the Portland area.

In an apparent effort to prevent a flood of Washingtonians from moving into more affordable Oregon, Portland and Oregon elected officials have passed numerous laws and ordinances that will make Oregon housing even less affordable than it was before — all in the name of affordable housing, of course. These include affordable housing mandates that require homebuilders to increase new home prices to pay for the below-cost homes they are required to provide, increasing property taxes to pay for affordable housing, and requiring landlords who raise rents to pay the moving costs of any tenant who moves out. Continue reading

Build Out, Not Up, in Hawaii

A new report from the Grassroot Institute urges Hawaii to address housing affordability issues by building out, not up — that is, by allowing low-density development of rural areas rather than building higher densities in existing urban areas. The report notes that Hawaii’s 1961 land-use law has confined development to 35 percent of Oahu, and less than 6 percent of the other islands, which created an artificial scarcity of housing. Building denser housing won’t solve the problem because dense housing costs more than low-density housing.

Click image to download a copy of this report.
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The Antiplanner will be in Honolulu on Monday to talk about this issue at a Grassroot Institute luncheon. If you expect to be in Hawaii that day, you can register for the luncheon on Eventbrite. I hope to see you there.

What Is a Mansion?

Fire Damages Del Mar Mansion,” NBC San Diego News reported yesterday. The mansion in question, the story added, had three bedrooms, three baths, and 2,242 square feet.

Merriam-Webster defines “mansion” as “a large, imposing residence.” The Free Dictionary says it is “a large, stately house.” Call me old fashioned, but 2,242 square feet doesn’t seem that large, imposing, or stately to me. Maybe compared with tiny homes it is, but even in California, most people have not yet been squeezed into tiny homes.

What is large about the house is the value: according to Zillow, it is currently worth about $5.3 million. That’s not because it has a great ocean view: it sits four houses back from the ocean and its views are clearly blocked by bigger houses in front of it. A nearby house that does sit on the ocean, but is only 1,851 square feet, is currently on sale for $11.8 million. These high prices are due to California’s various anti-growth policies. Continue reading