Housing is a hot button issue

I saw a poll last month and the numbers were clear: affordable housing is a priority in the hearts and minds of American voters.

Nearly 60 percent said that housing affordability was a key issue, and 74 percent said that they would be more likely to support a candidate who made housing affordability a focus of their campaign and a priority in government. Predictably, the issue weighed most heavily with the groups both major party candidates are seeking to win over: millennials (ages 18 to 35), those earning less than $50,000 a year, and those with children living at home.

We are the parents of four millennials; one of whom lives at home, two rent and one is off at college and living off campus in rental housing. So this issue is meaningful to this baby boomer and millions of baby boomers across the land who would like to see their kids move out—(even though we love them dearly).

In hot spots across the country, affordable housing is rapidly becoming a burning issue.

A planning commissioner in super expensive Palo Alto, California recently saw her resignation letter go viral when she lamented the high cost of housing in that tech hot bed which has prompted her to relocate. According to the Palo Alto Forward, the median home price in that city is $2 million. San Jose recently became the first MSA to surpass a $1 million median home price.

Civic leaders in Austin, Texas, another tech hot spot, sees an opportunity to better compete for companies and young talent with Silicon Valley: the high cost of housing.

Here’s an excerpt from a recent Austin, based blog: “The bureaucratic ordeal in getting a new software development project started at a large company is legendary, but pales in comparison to getting a land development project off the ground in Silicon Valley.

The Valley and San Francisco have their own versions of Microsoft Millionaires: Housing Millionaires. Folks who had the good fortune to own a house in San Francisco years ago and became lucky as their asset skyrocketed in value. Many of these folks have, understandably, become less concerned with making San Francisco a place where a new generation can make their fortune and more interested in protecting what they have. Despite (or perhaps because of) its reputation for innovation, San Francisco’s local politics is dominated more by discussions of the past than the future. Like a company that refuses to release new products out of fear of harming their current cash cow, the city has become extraordinarily conservative in its approach to new development. New developments must first prove that they will harm no existing residents in any way, rather than merely proving they will provide a benefit to new residents.

The results are catastrophic: San Francisco and Silicon Valley are failing at one of the core competencies of any city: providing housing. Tech workers spend enormous fractions of their income to live in poorly maintained homes in the Mission, while those outside tech frequently live far outside the city and commute long distances on congested roads. New housing for tech workers is protested as are buses to transport workers from homes in San Francisco to jobs in Silicon Valley. The city and the region understand that they are in an intractable mess of antagonistic politics, but still cannot do anything to extricate itself. San Francisco and the Silicon Valley are ripe for disruption.”

The conclusion: Housing is Austin’s killer app: specifically, walkable, bike friendly, transit-accessible, relatively affordable housing.

It’s an interesting observation and the author concludes by saying that business needs to be deeply engaged in public policy to ensure that local governments facilitate the construction of new units to keep up with the demands and needs of a new generation of workers and families.

Closer to home, the issue of workforce or affordable housing has ebbed and flowed with the strength or weakness of the market. I used to be on the board of the Affordable Housing Coalition of Palm Beach County formed during the previous boom. At the time, the issue was front burner but when the market crashed so did the profile of the issue.

Today, it’s back again.

According to a recent Harvard report, 11.4 million households pay more than half their income for housing, and the number of those who spend more than 30 percent of their income on housing has reached 21.3 million. And affordable housing isn’t just a problem for the working poor. In that recent poll, 47 percent said they have personally struggled to pay their rent or mortgage in the past 12 months, or know someone who has been in that situation.

“There are serious structural inequities in our country and within the housing market that can only be remedied with the private and public sector working together,” says Angela Boyd, managing director of Make Room, a national campaign focused on rising rents in America. (Funders of the effort include the Ford and MacArthur foundations). “About 90 percent of the rental housing market being built right now is for luxury, and a whole segment of the population is being overlooked — recent college grads with high debt, senior citizens with fixed incomes, working-class families. If there isn’t some sort of subsidy to fill the gap, some sort of policy that changes the equations, you will never be able to build decent apartments that people can afford based on the wages being earned right now.”

But even young college grads fortunate enough to earn a good wage are struggling to find housing that doesn’t consume the budget, especially if they have college loans to repay, a car payment, insurance etc., as many do.

And for starting teachers—my daughter for example—the issue is even more acute.

Locally, Delray historically has been active on this issue.

About 11 years ago, we formed one of the area’s first Community Land Trusts, passed a workforce ordinance (imperfect but used as a model by some other cities) and approved some projects that featured workforce housing including Bexley Park and Atlantic Grove (10 units).

While this isn’t a popular idea in some circles, it’s hard to achieve affordable housing without density. When land is expensive and densities are kept low, you just can’t add the product needed to address the issue. The Strong Towns movement also argues that this kind of development cannot be sustained financially because the cost of servicing sprawl outstrips the taxes it generates.

In Delray, the Congress Avenue Task Force, saw workforce housing as one of the key elements to jumpstarting the corridor and ensuring the city’s financial future. By creating a compact, mixed-use, transit oriented environment with amenities and affordable apartments, Congress has an ability to thrive by attracting millennials and others who would also work on the corridor.

It’s a long way from happening, but progress starts with a vision and if the right policies are in place, private investors will make it happen. There is certainly a need.

But cities, including Boca and Delray, also ought to look at the eastern cores to see if there is a policy tool to incent the creation of units for young professionals. Not only will they enjoy the amenities of living downtown, they will support local businesses year round. If we want to maintain the mom and pop establishments in an expensive environment, we have to do what we can to bring people downtown especially during the slower summer months.

The problem is a knotty one for cities, but there are policy tools available to create more opportunities for new households and young families. Like the Austin blogger notes, it may also prove to be a smart economic development tool. Housing may indeed be the killer app and lack of it may kill you too.