Is Co-living About Affordability or Gentrification?

JJ Chez Hacker House in San Francisco

JJ Chez Hacker House in San Francisco

New Orleans        Talking on Wade’s World on KABF  with Michael Robinson Cohen about his Yale School of Architecture studio project to design a hundred thousand affordable housing units for San Francisco, or any other city that understands the problem and the potential, led us naturally to co-living.  Michael and his gang believe there is tremendous promise in co-living for the emerging young precariat, drawn into the “gig” economy to a portfolio of jobs in tech and elsewhere that combine good prospects with speculative wages and a boom-and-bust income instability.  For these emerging young architects smaller spaces with increased common space holding both the necessities of kitchen, laundry, and even work spaces along with amenities to wash it all down more easily, points towards a potential solution on affordability that those of us working in the midst of a desperate shortage of affordable houses for low-and-moderate income working people also find attractive.

            Sadly, there currently seems to be more slips between the cup and the lip as the promise of this idea confronts the reality of developers who seem determined to warp co-living schemes into an upgrade in price and performance of college residential houses in the high-priced, red-hot real estate markets in New York, the Bay Area, Seattle and the like.  In post-Katrina New Orleans,  there had been a number of interesting proposals for affordable “worker housing” to help get the necessary labor into the city at affordable prices when rents had doubled in the wake of the storm.  None were built, though some smaller unit style developments for artists, largely white unfortunately, with section 8 certificates did emerge in several places. 

            Reading about co-living schemes in New York City and the Bay Area, developers seem to be rejecting affordability in favor of charging premium rents and reshaping co-living almost as connection clubs.  The New York Times talks about “hacker houses” like the ones touted in movies about Facebook.  In New York co-living seems also like staying in the Yale or Harvard Club, except on a longer timeline with interviews by the owners and potential house or suite-mates and probably the kind of blackballing still common in the fraternity scene.  As one of these smaller developers says, “…you can get a bedroom in New York for less than $2500.”  You can buy a mansion in many cities around the country if you’re willing to pay $2500 per month!

            A hipper and hungrier developer called Stage 3 Properties wants to build a co-living operation with 180 units to house 400 people and describes its mission as “passionately disrupting the housing industry by reimagining its process, product and price points and curating an all-inclusive cosmopolitan living experience designed for today’s creative class.”  I can guarantee that anytime you have the words, “reimagining,” “curating,” “cosmopolitan,” and “creative class” in the same sentence you better hold your wallet and purses with both hands because you are being shaken down for every penny while walking in knee high cow manure. 

            These rent-a-room hustles also are likely to have some problems with existing landlord tenant laws and single-room-occupancy rules in San Francisco and New York City for sure.  In the age of Uber though a lot of the hustlers think that rules to protect consumers or tenants are just rocks in the road on their way to riches, and therefore easily ignored.

           Co-living in practical and affordable housing could offer huge potential, but our friends and allies among planners and architects need to run, not walk, to beat the developers away from get-rich-schemes for themselves where desperate tenants and workers are overpaying and left again on the short end.

Gentrification Outstripping Community Development

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Protest in Chinatown over Gentrification

 New Orleans      Josh Ishimatsu wrote an interesting piece for theRooflines blog managed by Shelterforce magazine that asks troubling questions about whether rapid development in the form of gentrification has outstripped community development efforts.  He might have even gone farther and asked whether community development corporations have too often been the nonprofit stalking horses for the gentrifiers?

He makes the case based on the superheated rents being charged in San Francisco’s Chinatown where rents of over $1000 per unit are being paid young people for SRO, single room occupancy, spaces of 100 square feet, allowing landlords to make huge profits, evict lower income tenants, and take advantage of the city’s desperate affordable housing crisis.   He could have made a similar case in any number of “executive” cities and neighborhoods in the throes of gentrification.   For example, community development corporations (CDCs) have long been headliners in Brooklyn in one neighborhood after another, many of which are now demographically unrecognizable compared to the same communities thirty or forty years ago.  The amount of federal, philanthropic, and city money poured into upgrading such communities now seems like little more than site-preparation expenditures for the current crew of developers.

David Rusk, the former mayor of Albuquerque, has made these points exhaustively in comprehensive studies of the work of CDCs that he originally prepared, ironically, on the foundations’ dime as an evaluator. He famously found that looking at a range of housing and economic indicators in scores of communities targeted by CDCs the only measurable progress in his study was in one community in Cincinnati.  Sadly, that neighborhood rang the bells because it was in the process of being gentrified, so that was less than good news.

Ishimatsu makes the point that mixed-income neighborhoods show economic mobility for lower income families, but concedes that the “return to the cities” is obliterating mixed income communities.  The mobility for low income families is largely now the fact that so many are being pushed out to somewhere else and these neighborhoods are becoming single income areas based on affordability.  Ishimatsu wonders if there are more programs and initiatives that can wedge affordable housing bunkers into these areas, but I wonder if these scare resources need to desert those fields and move to improve the quality of housing and development in lower income areas instead.

Why leverage more public and philanthropic funds with private dollars as low income site clearance when the private dollars will come anyway, sooner or later?  It might be better to finally create decent, affordable and livable neighborhoods for lower income families and improve living conditions and quality of life now, rather than mixing and matching.  He’s right that existing strategies are inadequate, but we need to rethink the places where we make our stand, not just the tools of the trade.

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Please enjoy the Jayhawks, Waiting for the Sun. Thanks to Kabf.

Is Affordable Housing Being Crucified by Inequality

IKEA home in Sweden

IKEA home in Sweden

New Orleans      Increasingly it seems that we are going to have to decouple the issue of home ownership and affordable housing at least in the traditional sense of small footprints in the dirt with picket fences around them.  Home ownership due to harder loan standards, tighter credit, and the Great Recession has now fallen to 63.9% at the end of 2014, lower than at any point in the last 20 years.  A recent survey found that nine of the top eleven metro areas now have a majority of renters compared to homeowners led by Miami, New York, Boston, San Francisco, Houston, Washington, Dallas, and Chicago.

The trend towards “executive” cities like Seattle, Vancouver, London, and many others where housing  costs are atmospheric has foreclosed any opportunity for regular working families to consider home ownership in the classic, outdated “American Dream” sense of the term, unless they are willing and able to purchase cooperative apartments or condominiums.  Even while moving that dream off the shelf, the affordable housing crisis remains unabated unless we embrace some change.

How about manufactured housing?  I’ve got to admit I like my time living in Airstreams, and I’ve become friendly towards trailers. The Economist had nice things to say about “system-built” housing recently which also caught my eye:

“…system-built housing does not have to be shoddy or impersonal. Huf Haus of Germany has been building high-end prefabricated housing since 1912.  Adatahaus, a British firm specializes in homes that can be reconfigured as a family’s needs change.  IKEA of Sweden sells flat-pack houses that can be customized.  Furthermore, big companies can help people to self-build a personalized home while enjoying economies of scale:  Cemex of Mexico provides self-builders with access to cheap fixtures and fittings, and cheap finance, as well as cement.”

Ok, maybe not everyone’s cup of tea, but poking through Craigslist last night I saw a corrugated metal-sided and roofed structure on higher ground towards the Gulf of Mexico that looked beckoning.  Just saying.

Where would you site such housing?  Interestingly there is already a controversy breaking out in East New York on Mayor DeBlasio’s plan to protect affordable housing in that area, which many residents see as gentrification.  We’ve talked about the double-edged sword of “market rates” before, when the inequality of wages and wealth has perverted the market.  The deal that ACORN made in Brooklyn for over 2000 units of housing around the train tracks at Atlantic Yards has still not produced on that promise after more than a decade.

There’s vacant land though in many cities crying for company.  Turkey assembled 1600 square miles equal to 4% of the country’s urban area when  the national housing agency bought land from other state agencies.  China puts the hurt on developers sitting on property to force the issue by imposing a 20% tax on the value of land parcels left undeveloped for more than a year.

Meanwhile rent levels of 30% or more of income and mass numbers of roommates has become the norm in many cities.  One estimate has more than 20 million paying more than 30%.Looking at average rents in mid-south cities like Houston, New Orleans, Dallas, and Little Rock, we found the numbers on the average between $650 to $750 per month.  To make that nut an individual would need to make between $12 and $16 per hour if they were going to live by themselves.

Affordable housing is possible, but not without living wages and a strategy that values citizen wealth and family security as more important than a picket fence.

Attacks on Fair Housing and Affordable Housing Demands

rallyNew Orleans    Talking on “Wade’s World” on KABF with George Washington University sociology professor and frequent author, Gregory Squires, about his recent piece in Social Policy on the impact of the Occupy movement, he underlined his concern that the “disparate impact” theory is under review in the term of the US Supreme Court and the threat that decision could hold for fair housing advocates.  It’s worth the worry.

As a Justice Department official noted several months ago, real estate agents, landlords, and others have cleaned up their act so that there is little of what she called “pants-down discrimination,” in what they say, but there is still plenty in what they do, and the “disparate impact” theory has been the prevailing tool to assure fair housing without discrimination.  If the impact is discriminatory, regardless of the intent, then it has to stop so that diverse populations do not face housing discrimination.  HUD according to all reports is hustling to enshrine one single standard for disparate impact in regulations in hopes that the Supreme Court will follow its usual tendency of allowing the government and its regulations to prevail in the separation of powers.  Given the recent tendency of the Court’s majority to bend over backwards in pretending that the days of discrimination are over, it’s a valid fear for housing advocates.  The Justices might be persuaded to temper there 1950’s “good times are back again” viewpoints in the wake of Ferguson and New York City protests and disturbances, but we certainly can’t count on it.

We also talked about the ongoing “push out” of low and moderate income families from executive cities because they can’t afford the housing.   Squires and the DC-based community organization, ONE, Organization of the North East, have been campaigning for equitable development and have a 2nd conference on the issue coming to Washington soon.  Coincidentally, I had just heard from a colleague studying at the Yale School of Architecture about an assignment they have to try to design 100,000 units of affordable housing in San Francisco.  It’s not academic when you read recently that experts are referring to the Tenderloin, the San Francisco district known largely for union local headquarters and derelicts over the years, as the last “working class neighborhood” in the city.

Ottawa ACORN was also in the news on the same kind of issue in Canada, where they are putting on pressure to win “inclusionary zoning” that would establish affordable housing as a mandatory requirement in any new housing development over a certain size.

Ottawa ACORN coordinator Curtis Bulatovich said they want inclusionary zoning and hope a private members bill, introduced in Queens Park by Etobicoke-Lakeshore Liberal MPP Peter Milczyn, is approved. It would give cities the power to mandate a certain percentage of total units as affordable housing in residential development of 20 or more units that require by-law amendments.  “We wouldn’t have as many “ghettos” in this city and cities across the province. It would be an affordable enough thing for developers to do and it would also show that they are giving back to their communities,” Bulatovich told CFRA News. He said the time to act is now.

“In a lot of areas, specifically Westboro, you have a lot of empty, beautiful newly built condominium (units) and I was thinking you could easily, easily have those to inclusionary zoning.”

He could have added “before it’s too late,” which increasingly seems to be the crisis we’re facing in a number of cities in the United States and in places like London and Paris around the globe.

Inclusionary but Unaffordable “Affordable” Housing in London

if_you_dont_live_hereLondon     In the dark days of neo-liberalism when cities and states are embracing private developers to impact their profound public responsibilities to provide decent and adequate housing for families regardless of income the whole notion of so-called “affordable” housing seems to have been left in the rubbish at the construction site.  Where recently we thought perhaps the inclusionary zoning type standard for new developments in London requiring 20% of the units be “affordable” might be preferable to some similar initiatives in the United States, on closer inspection it’s a mirage.

Simply put the various borough councils in London have decoupled rent from income in this new doublespeak of “affordable” housing.  Twenty percent of the units must be classified as “affordable,” but that means the rent in those units is discounted so that tenants are only paying 80% of the market rate. In the overheated, gentrified housing market in London that means two things. One that your rent will keep rising, squeezing you out later, rather than soon, if you happened to be in such housing, and, second, that you’re a long way from poor and lower income when you qualified, since in some of these units you would have to be making big money to be able to afford the so-called “affordable” housing.

The Conservative government and its austerity program has put a gun to the council’s heads, but they have also in most cases swallowed the bullets like candy, and continue to sell off council or public housing willy-nilly in various schemes that deplete the housing stock and squeeze the lower income families to other boroughs and out of the city completely. The Guardian reports:

 

Last year, even the Conservative Westminster council warned London mayor Boris Johnson that plans to set new rent levels at up to 80% of market rent would require council tenants in a three-bedroom home in the borough to have an annual income of £109,000 in order to be considered affordable. The council estimated that half its social rented households receive an annual income of less than £12,000 a year.

 

In New York City, the easiest comparable big city to compare to London, inclusionary zoning is voluntary, though Mayor de Blasio is clear that he has his sights on changing that to mandatory, and the rents are targeted to family income, which is good, but there just aren’t enough of them. Hard to say that’s a whole lot better. The families that literally win the lottery and get to live with the rich are still few and far between. And, New York is still an exception since despite some progress in San Francisco, Santa Fe, and a couple of more, inclusionary zoning, pushed by housing advocates, has never been able to trump the dreams and dollars of developers in city halls across the country. That much seems true on both sides of the water. The other startling truth is the crisis in affordable housing and the needs of families for decent and affordable housing are simply not being heard or met.

Affordable Housing Push-out Problems in Vancouver, New York, and London

affordable-housing-crisisBristol     Reading the news is one thing but watching the steady stream of young people and many not so young at the Rock & Bowl hostel in central Bristol where we have been staying for the last several days underscores the affordable housing push-out.  New residents with jobs of all kinds are paying 10-15 pounds per day while they look for housing around Bristol, which is a long way from the executive city, mega-development high priced housing in other world cities, like Vancouver, New York, and London.

A recent piece in the New Yorker detailed the bizarre contradictions of housing prices in Vancouver.  A professor we know called Vancouver an “executive” city a dozen years ago, meaning only executives could afford to live there, and certainly almost all of ACORN’s members have been pushed out farther and farther to Burnaby, Surrey, and beyond.  The New Yorker story focused on the fact that the housing market has become almost a hedge for global capital, especially from China and other Asian countries, to invest in housing as a refuge investment, even while left unoccupied.

An London-based organizer sitting in on ACORN International’s meetings in Bristol told us at length of the difficulty of characterizing many boroughs in London since slums, council housing, and upscale housing and mansions were all crowding in on each other.  She also told us of whole blocks of fancy mansions which left whole blocks vacant year round, also as a sort of refuge home or at best occasional location, but with no people they are starving out small shopkeepers since despite the old adage of “location, location, location” assumed people actually lived in those locations.  She also told us of the difficulties of finding even starter houses, or “ladder” houses as she called them, for homeownership.  London banks even several years ago had been willing to make loans for “shared” housing, where two, three, or more unrelated individuals could pool their resources to qualify to buy a house, but those kinds of loans have largely disappeared.

As disturbing was reading in the Times about the policy dilemma created by the soaring cost of New York City housing even within the framework of existing inclusionary zoning regulations.  The program currently is voluntary meaning that developers can create 20% of the units at affordable rates in order to increase density by one-third.  The rents are so high that the subsidy in many cases might be as much as $90,000 per year.  Some developers not only walk away from creating affordable units because of the cost, but even some housing advocates are arguing that more affordable units might be created with a cash exchange rather than an apartment provision especially in Manhattan.  In places like Williamsburg in Brooklyn, plain vanilla apartment blocks with increased density in cheaper rental areas don’t have the amenities, but relatively speaking are holding rents down.  Mayor de Blasio has proposed moving exclusionary zoning to a mandatory program, but it could be that bartering for cash with the developers creates more housing, almost like the Mumbai program where developers have to build replacement units for those they tear down.

As much as we have to want our major cities to not simply be enclaves for the rich, I have to wonder about the lives of our moderate income families trying to make it as a small minority of the population in cities where not only the housing but everything else is tilted towards serving the rich. Even if they were fortunate enough to barely afford shelter, could they find any other provisions or services affordable where the urban 1% have now occupied?

We are in danger of having major cities converted to the equivalent of gated, island communities with moats made of insurmountable walls of money.