For many first-time home buyers, affordability concerns don't stop once the initial down payment is scrounged up, or even after monthly mortgage amounts have been calculated. How a house is designed and built can also influence its net effect on the household budget long-term. “You don't want to put someone in a home who will then lose it because they can't afford to pay their utility bills,” says Angela Hurlock, executive director of Claretian Associates, a nonprofit developer in Chicago.
Opportunities for urban revitalization seldom come in neat little packages. Consider the turnaround of Providence's downtrodden Smith Hill neighborhood—a five-year effort involving three construction phases, two nonprofit developers, two builders, and a handful of non-contiguous lots to produce a mix of low-income, workforce, and market-rate housing. Phase one alone introduced 28 affordable rental units (some new, some rehabbed) on 13 scattered infill sites.
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At first glance, you wouldn't peg the 132 residences of Victoria Green in Hercules, Calif., as affordable rental housing. With their deep overhangs, hipped roofs, and crisp fretwork, they look too pretty. And with their panoramic views of the San Francisco Bay, one might easily assume these coastal beauties come with a much higher price tag. After all, they're part of a larger master plan that includes market-rate homes selling for upwards of $1 million.
Architecture, site planning, and construction pro formas can make or break the bottom line.
Most of us would find it astonishing that a person earning $19,500 a year could afford to buy a new home in a neighborhood where the houses sell for $115,000 to $600,000. But when the Los Alamos Housing Partnership developed Piñon Trails, a mixed-income community of 120 homes in Los Alamos, N.M., director Steve Brugger took advantage of every tool he could find to finance homes for buyers earning an average of $37,000 a year.
“Affordable housing is good for the community,good for the city,and good for us,” says David Weekley, chairman of David Weekley Homes, about his company being named to build the affordable housing component for the first phase of the Mueller redevelopment project near the old airport in Austin, Texas.
The pricing on any housing project starts with the land, but it's especially important for a builder who wants to create affordable housing. Creativity and the ability to look at a piece of property and see its potential for housing is key, says Henry Cisneros, former HUD secretary and current chairman of Santa Monica, Calif.–based CityView, which provides financing, entitlement and marketing assistance, community outreach, and other help to work-force housing builders.
The twin clapboard houses that contractor Norman Scotland built side-by-side on Warburton Avenue are what one might expect to find in Westchester County, N.Y. Modest in scale and colonial in flavor, you almost wouldn't know they were newly constructed just a couple of years ago. And with their enviable views of the Hudson River, you'd never guess that they are affordable for-sale duplexes set above apartment flats, with the flats designated as rental housing for low-income tenants.
America's housing industry faces the greatest threat to its sustainability in decades from a crisis of affordability that is shutting out increasingly larger numbers of prospective buyers from purchasing homes, whose prices—despite recent reductions—remain simply out of reach.
At what point does a problem become a crisis? In the case of the housing affordability crisis, it seems easy to identify: When a biomedical engineer earning $98,000 easily qualifies for one of the affordable housing units in a townhouse community in South San Francisco. The gap between the housing haves and have-nots continues to widen at an alarming pace, and the hurdles have gotten higher, with professionals with advanced degrees joining the ranks of those struggling to find homes they can afford.
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EARLIER THIS YEAR, THE NAHB and the International Code Council (ICC) announced their agreement to develop a new National Green Building Standard, providing a common benchmark for recognizing green residential design, development, and construction practices. Because market demand for green-built homes is growing rapidly, the NAHB Research Center, which is coordinating the effort, has set an aggressive timeline for development and is expected to complete the standard in early 2008.
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IN MY JUNE 2007 COLUMN (“INVENTORY OVERLOAD,” page 76), I talked about serious deterioration of the supply-demand balance in housing markets—owing to a large runup in vacant housing inventory combined with renewed downward pressure on home buyer demand due to subprime-related tightening of mortgage lending standards.
As the old saying goes, there is strength in numbers, and with an official count of 235,000 members, the NAHB is larger and stronger now than ever before in its 65-year history.
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- Increasing operating costs put hundreds of affordable apartment communities in financial jeopardy, according to new study.
- Builders continue to demand homeownership for all Americans.
- Home builders applaud House passage of legislation that they hope will establish a strong regulatory framework for housing government-sponsored enterprises.
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Brett and MaryAlice Hawkins arrived in Los Alamos, N.M., from Vermont via Papua New Guinea after a two-year stint in the Peace Corps. Both teachers, they qualified for special financing at Pi-on Trails, a mixed-income subdivision with an affordable component developed by the Los Alamos Housing Partnership.
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VIRGINIA FINALLY PASSED A TRANSPORTATION bill this year, but builders are not happy about an open-ended road impact fee they claim Gov. Tim Kaine slipped in at the last minute.
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UNDER NORMAL CIRCUMSTANCES, Pulte Homes' annual shareholders' meeting in Birmingham, Mich., on May 10 would have been uneventful: The builder declared a 4-cent quarterly dividend, and its CEO, Richard Dugas, lamented sodden market conditions.
CAMBRIDGE, MASS.–BASED media company Blue Egg has launched what it is calling the largest online business resource for sustainable building professionals.
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Economists' predictions for employment in the housing industry are grim. With first-quarter housing starts and building permits down nearly 25 percent and 27 percent respectively, forecasts for layoffs in residential construction are topping off in the half-million range. And that's not including related manufacturing jobs, which puts the number closer to a million.
- Allstate stops writing new homeowners policies in California as a way to help control its disaster exposure in the state, which is prone to wildfires and earthquakes.
- Sluggish home sales in many metro areas have made it more difficult for corporate employers to negotiate job relocations, according to a 2006 survey.