Almost daily we read about the affordable housing crisis in Utah, and I picture many people reading the articles and thinking, “That’s too bad for young families.” But do they really know how it affects them when their home is worth much more?
This is how the real estate market works. If you put your home up for sale for $900,000, it will likely attract a buyer who sold their home for $700,000. The buyer for that home sold theirs for $500,000, after securing buyers who just sold their home for $250,000. It is the bottom rung of this ladder that triggers it all. When the lowest tier locks up nothing happens. Home values drop in response.
There is an old saying, “Why should I bail water, it’s not leaking on my side of the boat?” If affordable housing sinks we all sink with it.
When we celebrate climbing home prices, and not back-filling with entry level housing, we are really celebrating the faster speed at which the Titanic will hit the iceberg.
There are only 52 single-family homes and 66 condos listed in Salt Lake County at $250,000 or below as I am writing this, and it will require an estimated annual income of $45,000 to $55,000 to secure the mortgage to purchase one. The median household income for Salt Lake County is $58,000, meaning half of these households are below that mark. These statistics mirror most of Utah. Homeownership is out of reach for many.
When renters are trapped in their apartment due to high housing costs, it creates greater leverage for landlords to raise rents. A modest two-bedroom apartment requires an income of about $20 per hour. An additional concern is the negative impact on children when the family moves every time the rent increases.
OK, I am through cursing the dark and would like to talk about lighting some candles.
The first steps are to understand that the availability of affordable housing helps us all. The second is for everyone in our community to take a stake hold in the solutions.
Higher land costs are driving prices up and we need to make better use of the land by supporting higher family density developments. The scarcity of land will continue to drive costs up. We must use our land more efficiently.
Make a commitment to building affordable housing that remains affordable into the future. This can be accomplished through title restrictions that allow some equity growth but keeps costs low for future families.
Create inclusionary zoning in all neighborhoods. Roadblocks are often an effort to just stop change. Change is coming. Let’s manage it now.
Make building code improvements that keep safety at the forefront, but allow older buildings to be updated without onerous restrictions. Provide options to add accessory dwelling units. Simple one-bedroom apartments can make a big difference.
Regarding subsidized housing, consider taking a portion of the rent and allow the renter to accrue a down payment. Enabling the family to move up and out into homeownership creates space for new families to enter the program.
Build affordable housing that is not only affordable to buy but also affordable to own. Efficient homes that have low utility costs increase the ability for families to thrive. Lower monthly bills unburden the family from wasting scarce resources for 30 years.
It will take a wide array of solutions to solve this problem. It will also require community support. If affordable housing affects us all then we should ask “all” to participate in solutions. “Everyone can help bail water.”
Edward R. Blake | Habitat for Humanity
Edward R. Blake is the CEO of Salt Lake Valley Habitat for Humanity and an advocate for decent affordable housing in our community, which provides a “safe harbor” for children and allows families to thrive.