By Kirk Ross
You measure the success of any public policy not on what happens on paper, but on what actually happens.
Decades ago the various boards of local government struggled to adopt affordable-housing policies that made sense for this area. The challenge then was pretty much the same as now: In an expensive and appreciating market, how do you maintain a diverse stock of housing?
Maintaining a housing supply that allows the people who work here to live here and be a part of the life of the towns has been a long-established value in this community. In the mid-1990s the effort took off after a shift in policy in which elected boards began to leverage their decision-making power in zoning changes to require affordable units. The shift coincided with a major, sustained housing boom.
There are now 191 properties in the inventory of the Community Home Trust, the organization that evolved out of efforts to manage the strategy and its results.
There are more on the way, including 17 units in the Ballentine subdivision in Carrboro and 18 condos at 140 West in Chapel Hill. Almost half of the homeowners work at either the university or UNC Health Care or teach in our schools.
As successful as it’s been, in the wake of the Great Recession, the home trust and affordable-housing proponents are faced with an increasingly difficult task.
Changes in the housing and financial markets, reductions in federal housing money and affordable-housing rules in Chapel Hill and Carrboro are squeezing resources and narrowing participation.
Since the home trust’s inception, the rules for affordable housing, some dictated by federal requirements, and the Chapel Hill-Carrboro housing market have combined to greatly limit potential participants. To qualify, you have to make 80 percent of the median household income or less (this year that’s $38,500 for a single person and $54,950 for a family of four) and you have to be able to make that income work in this market.
In a recent conversation, Community Home Trust executive director Robert Dowling talked about how that plays out. A single teacher with five years of experience and making about $36,000 qualifies, but a two-teacher couple or a similarly compensated couple of young professionals doesn’t. In a market where the bottom is around $200,000, that couple is more likely to head to Durham or Chatham.
And since the local housing market has produced more and more condominiums and townhomes, it’s been harder to appeal to the small families that policymakers want to see use the program.
I doubt anyone would purposefully design a public policy that sends young professionals and new families packing, but that’s the effect.
This is the demographic that tends to shop more, go out to eat more and so on.
At the same time, home ownership, even with significant subsidies, is now off the table for a larger number of people, thanks to tighter credit requirements and the impact of the economic downturn.
Dowling said one of the public policy decisions looming is consideration of an affordable rentals program to address the changes. With “the bloom off the rose†of homeownership and most of new development focused in rental housing, he said, it’s time to take a hard look at finding a way to incorporate rentals in the overall strategy.
The urgency to do something about the changes in housing types, financial realities and consumer preferences is growing.
Federal support is dwindling rapidly. Housing money is a typical target when discretionary spending is cut, and it’s been hit in the past two years to the tune of 15 percent in 2011 and 38 percent this year.
That threatens the home trust’s main sources for subsidies. That exacerbates the organization’s long-running need for an increase in cash to keep up with property maintenance, upgrades and other costs as its supply of housing rises.
Over the past decade the Carrboro Board of Aldermen and the Chapel Hill Town Council have tried to fine-tune a payment-in-lieu policy that would allow the trust to take cash instead of housing units. But both governing bodies have shown reluctance to free up rules on payments-in-lieu, preferring to increase the stock of housing in the trust. In light of the federal cuts, that needs to change.
Taken together, all of these issues in affordable housing add up to a big need to rethink the strategy and revise the rules. As Dowling pointed out, the current set of ordinances were designed amid a much different housing market. I don’t know anyone who thinks the housing market will ever resemble the one we saw seven or eight years ago. Our affordable-housing policies shouldn’t either.