THE “AFFORDABLE HOUSING” PARADOX

^ ugly and hasty and nowhere near enough : new housing construction in Boston

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Every politician in Boston today wants the City to enable “affordable housing.” Wouldn’t we all ? Nobody I know wants to pay 50 percent of her income for rent. We’d all want to find an apartment with a rent of, say, $ 1,200 a month. Why not $ 800 ? After all, an apartment isn’t a golden Cadillac, it’s just space into which we can snuggle and relax. No big deal. Why not then ?

Let us take a look at “affordable” and its curiosity :

Boston would be very “affordable” if we could cancel the building boom, evict all the businesses that have located here, and go back to the 1970s, in which the downtown, and the close-in neighborhoods of our City attracted nobody and nothing. Those who lived in South Boston, Charlestown, East Boston and even the North End, 45 years ago, paid very little rent, or paid very small amounts to purchase. Incomes were much smaller then, to be sure, but rents and sale prices were many times smaller. Paying 12 percent of one’s income was standard for rents, and homes cost less than one year’s income. Houses cost so little — and hardly ever came onto the market — because almost everyone wanted to move to the suburbs, and almost no one wanted to move into the city. Why so ? Crime mobs controlled many neighborhoods, jobs were for life — which meant that newcomers could not break in — and those who owned houses rarely renovated them because they couldn’t recoup the cost of doing so. No wonder that by the late 1980s vacant lots abounded; that many decayed dwellings had been condemned and eventually demolished.

The laws of economics cannot be evaded. If people want something — want more of it than exists — the price of it goes up. Boston in the 1970s tried to dent the first blip of rising house prices by installing rent control. All that did was to displace value, not abate it. Landlords stopped repairing apartments whose rents could only be raised a little at a time — and that only with the City’s permission — and more than one rent control tenant rented out a room or two for more money than she was paying in rent. Eventually the City had no choice but no end rent control, and the legislature made it illegal statewide.

That was the beginning of economic acceptance, and of the City’s attraction as a place to move into.

So much for the curious facts of property economics. We are NOT going back to funky, dilapidated Boston into which no one wanted to move. Rents are not going to backslide any time soon, and house prices aren’t headed for the dustbin either. $ 600,000 to $ 800,000 is now the standard for purchasing a home in the close neighborhoods to downtown, and few condominium units can be bought for less $ 400,000. You’ll pay $ 2,100 to $ 3,000 a month to rent a two-bedroom apartment, and in some cases, more. I doubt these prices will rise much higher — they’ve already priced more than two thirds of families out; our medium, family income is about $ 44,700, and to afford a $ 2,500 a month rent you ought to be earning about $ 90,000 — but they aren’t headed downward much either. Meanwhile, Mayor Walsh wants the City to have 53,000 units of new housing by the year 2030, and his Planning and Development authority, which oversees all new construction, is approving almost every proposal submitted to it.

Into most residential proposals is built the City’s “affordability covenant,” by which ordinance a development of more than a few units must set aside a particular percentage of those units at a price determined to be “affordable” the other units can be offered at “market rate”). (You can read the City’s Affordablity Rules and income restriction guidelines here : http://www.bostonplans.org/getattachment/91c30f77-6836-43f9-85b9-f0ad73df9f7c )

It’s a useful policy, but the need for housing that costs twenty to forty percent less than market — as indicated by the median income figures that I identified earlier in this article — is far more widespread than the affordability number required by the City of its 53,000 unit plan. So what can we do ?

Actually, there are four means that might help:

First : why not adopt the $ 15.00 an hour minimum wage that some progressives have proposed ? Minimum wage workers perforce require affordable housing. Increasing their paychecks by 30 percent would enable them to pay the current rents in most Boston neighborhoods without having to live five to seven adults to an apartment, as is common in many bull market-impacted pars of the city.

Second : build more so-called “micro” units : very small apartments, good for single people — of which there are a great many, come into Boston to work in our booming technology industry — and rentable at $ 1,200.00 or some such.

Third, require universities based in Boston to build dormitories, thereby removing from the ordinary rental market many thousands of students who now compete with regular residents for scarce Boston living space.

Fourth, apply City occupancy and zoning ;laws to prevent the purchase by investors of residential buildings for air bnb rentals and such like.

Every one of these suggestions generates its own difficulties. Still, these can be met, and it is not acceptable to do nothing because actions to mitigate the high costs of housing have consequences. Activists and policy makers are already working the last three of my four suggestions. Why not also the minimum income rise ? Yes, it may generate difficulties for marginal businesses, and the other three moves may create logjams at college budgets, zoning and occupancy administrators, and construction projects. Yet I think our City has the authority and our people have the ingenuity to find ways around the obstacles posed by too high housing costs. There might even be ways other than those I have listed, and these might surpass the effectiveness of my list. Why not propose some ?

We want the current economic boom to continue. People want to live here, work here, shop here and socialize here, innovate here and produce here. These are good things. They’re why cities exist at all. Yet no one can sit on the laurels of a vibrant city. Always the city pushes us to keep moving, and moving faster than the difficulties which, if we do not move fast, can set us back to the dark ages of funk, dilapidation, and silence.

—- Mike Freedberg / Here and Sphere

 

 

Author: hereandsphere

Here and Sphere is an online journal of news, opinion, reviews, advice, & bits n' pieces of everything else - from HERE to SPHERE...... Co-founded by Michael Freedberg, a long-time Boston Phoenix journalist, and Heather Cornell, a South Coast Massachusetts columnist and editor.

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