Urban housing shortages

[ThomCat]

Finding an affordable place to live is becoming nearly impossible, and often it involves living in a neighborhood that may be several hours away from where you work by public transportation. I know, here in NYC, a 2 hour commute is not uncommon.

What should we be advocating? What might work?

I know that landlords have a tax incentive to leave some of the their buildings vacant. The tax writeoff is more profitable for them than renovating and offering the apartments at affordable rates. The empty units would go a long way towards easing the housing crunch, but landlords don't feel they can afford to rent them out at less than market rate, and we couldn't afford the market rate to live there.

New construction doesn't seem like a viable option. Who's going to build apartments for anything less than the most affluent? Nobody is going to deliberately build apartment buildings for poor people. There's no profit in it.

:shrug:

[Gormy Cuss]

1. The short answer is that the Federal government needs to get back in the business

of funding affordable rental housing production and providing incentives for rental housing where there is insufficient stock in the nonluxury market. The move away from rental housing to a focus on home ownership only is perhaps the biggest policy mistake since FHA was established in 1937.

"Affordable" in housing policy means that households pay no more than 30% of income for housing. HUD by its mission is charged with serving lower income households through programs administered by public
housing agencies or nonprofits but in the past HUD also sponsored mortgage interest write-down programs for private development of rental housing for households earning up to the local area median.

In short, HUD knows how to do this. What's missing is a mandate to do so.

[ThomCat]

2. Would you trust HUD to do this?

I agree that it would help, but only if HUD wasn't corrupt. My knowledge of HUD is limited to past scandals and reports that they were predominantly helping developers and upper-middleclass homeowners.

[Gormy Cuss]

3. Yes, having evaluated HUD programs for many years as an independent public policy researcher.

Most "HUD" scandals are really end user problems caused by corrupt local officials or landlords using HUD monies inappropriately. HUD has monitoring and reporting systems to keep track of how their allocations are used and in the case of public housing authorities HUD has taken over administration of inept or corrupt local agencies in order to bring the spending back into compliance.

The larger policy issue is that HUD hasn't been in the business of adding publicly owned rental housing in almost 50 years. Any rental housing with HUD sponsorship in that time was either replacement of units that were no longer usable or privately-owned, publicly subsidized units. While there were many examples of well managed programs in the latter category, that mechanism for producing units has essentially dried up too in favor of the one-note Republican mantra of "home ownership for all." HUD funding on the rental side of the equation has been woefully inadequate for decades. The lack of a sufficient rental stock is one of the pressures on home prices at the bottom of the price range and that's one of the reason so many people get duped by sleazy mortgage products -- they're desperate to gain some control over the cost of housing because rentals are eating up 50% or more of their income. The lack of affordable rentals means they can't save for down payments either.

Why rental housing? First, the private market without incentives will build ownership units rather than rental units in almost every case because it's a shorter term commitment with higher profit potential. Second, if the HUD-backed rental production programs increase the supply of affordable rentals, we can drastically reduce the homeless programs because the need will diminish and people will be able to live in more stable settings and bring rents down to an affordable rate for others. An important part of HUD funding is ongoing operational and capital funding expenditures to keep the stock in decent shape.

IMO, the experiment of letting the market respond hasn't worked and that means it's time for government to step up to the plate.

[ThomCat]

4. The market is rarely the solution

that true believers think it will be.

I agree that affordable rental units is a key to a lot of other problems. If people could find and afford rentals

1. There would not be a market for illegal apartments built into people's attics and basements. That's a real problem here in NYC.
2. There would not be so much flight out into the suburbs, causing even more suburban sprawl.
3. There would not be as much of a market for predatory lenders to target.
4. There would not be as much of a market for the shitty little prefabs that are getting tossed together everywhere. Buyers would have more money saved, so there would be pressure on developers to build better quality homes.

[ramapo]

5. Urban housing is a huge mess

The obvious problem is the incredible deterioration of the urban housing stock over the past fifty years along with the deeply ingrained and seemingly impossible to solve associated social dilemmas. A corresponding problem is the relentless sprawl induced in part by the flight out to the suburbs and beyond. In large part, the middle class have abandoned the cities leaving behind the poor, for whom survival becomes more and more difficult, and the rich who just drive up the prices.

Gentrification can be seen throughout NYC. The good news is that areas that were not long ago pretty scary places to live are being reclaimed. The bad news is that the expense of living continues to climb out of the reach of many.

A couple of generations ago, the urban areas of NJ were diverse and thriving cities. Today they are, for the most part, a shell of their former selves. Given the future uncertainty around the viability of a car-centric, oil-based economy, these urban centers should be the proving ground for a new urbanism.

I have no idea how these centers can actually be revitalized. Government programs have been a dismal failure. I've seen some ugly, out-of-place, housing thrown up to replace torn-down slums. These are plopped down piecemeal and do little to address the overall problem.

The market is doing much of the work in NYC but the poor are being forced out. NJ's urban centers don't have the market going for them. Something needs to drive a huge investment in these cities, one large enough to completely revitalize whole neighborhoods, bring in business and jobs, yet address the needs of the current residents.

It would be nice if our politicians would address the rebuilding of the United States before the rebuilding of Iraq but I don't that this particular subject is of much interest, nor would it attract much support, from the citizenry at large. Out of sight, out of mind.