Only in Albemarle, Do You Make Housing Affordable by Making It More Expensive

Adapted from Comments to the Albemarle County Board of Supervisors regarding Housing Chapter of the Comprehensive Plan September 9, 2014.

My name is Neil Williamson and I serve as the President of the Free Enterprise Forum  a privately funded public policy organization covering local government in Charlottesville and the surrounding localities.

Tonight you might be discussing the Housing Chapter of the Comprehensive Plan. Internal to this chapter is one of the most baffling policies of Albemarle County – the affordable housing proffer. I have passed out a recent Richmond Times Dispatch article questioning the rationale and nexus of cash proffers Are Proffers on Shaky Ground?.

For all residential rezonings, Albemarle currently requires 15% of the new units be affordable. This is on top of the $20,000+ per Single Family Unit Cash Proffer.

The affordable housing proffer ultimately results in 85% of all new units to be less affordable. By making the majority of the new houses more expensive, you have harmed overall housing affordability. Only in Albemarle do you make things more affordable by making them more expensive.

According to the Draft Chapter:

Albemarle County’s Affordable Housing is defined as houses affordable to households not exceeding 80% of the area median income.  At present an “affordable” sales price for a home is $211,250 for a family of four paying 30% of their income for housing costs.  Approximately 40% of the households in Albemarle have incomes at 80% of the median or lower.

Those buyers who acquire the “affordable” units are effectively lottery winners. Their neighbors have subsidized their purchase and when they choose to sell, there is nothing that keeps that home affordable and the buyers gain the windfall. As noted on Page 9.13 “If Albemarle County is to have affordable housing stock, it must find a way to make sure the affordable units stay affordable.

Why does it fall on new home buyers to “solve” the affordable housing inventory issue?

To date as a result of rezonings,  approximately 1,200 affordable units have been “voluntarily” proffered (100 have been built).  In addition, approximately $1.6 Million Dollars have been “voluntarily” proffered as cash-in-lieu of units.

If this is a community issue, why isn’t the community equally invested?

The reality is due to the myriad of regulations, codes of development, $20,000 per single family home cash proffers, mandated sidewalks, street trees, water and sewer hookup fees – new housing stock is perhaps the worst place to try and create (and maintain) affordable housing.

The Free Enterprise Forum believes adaptive reuse and refurbishment of existing housing stock would be a much more cost effective method to increase affordable housing. Further study should be done regarding financial vehicles that allow the property to remain at market value and the loan to be modified – such work might go a long way in keeping housing affordable – The Housing Trust model is one such vehicle.

In addition, we do not believe this chapter adequately addresses the significant impact of rental units on the market. Affordable housing does not have to be affordable housing ownership.

We encourage you to pursue code changes to allow more flexibility for accessory units in the development areas and to allow residential dependencies in the rural areas. While the latter may seem to contradict your goal of moving development into the development areas, it is a reality that eliminating the land cost for a second residence on a 21+ acre parcel dramatically impacts the cost of the home.

We applaud the attention paid to reducing or eliminating minimum lot sizes in the development areas.  We encourage the continued review of setbacks to further maximize land in the development area for development.

Finally, we would be remiss if we did not raise issue with Strategy 6d regarding increased staffing. Just as in the other chapters, staffing levels should be an operational decision by the Board of Supervisors and not a line item in a Comprehensive Plan.

Thank you for the opportunity to comment

Respectfully Submitted,

Neil Williamson

———————————————————————-

20070731williamson Neil Williamson is the President of The Free Enterprise Forum, a public policy organization covering the City of Charlottesville as well as Albemarle, Greene, Fluvanna, Louisa  and Nelson County.  For more information visit the website www.freeenterpriseforum.org

Advertisements

One response

  1. […] Only in Albemarle, Do You Make Housing Affordable by Making It More Expensive […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: