ULI Austin News

August Breakfast Recap: The Hunt for Attainable Housing in Austin

ULI Austin Monthly Breakfast Series Recap:
Searching for a Unicorn: The Hunt for Attainable Housing in Austin
September 5, 2017   Provided by Hahn Public Relations       Platinum Underwriter:      stgdesign

Moderator: Mandy DeMayo, Community Development Administrator at the City of Austin (former Executive Director at HousingWorks Austin)

Panelists:

 Key Takeaways:

  • There is a difference between Capital A Affordable versus lower-cased a affordable: Capital A Affordable is legally restricted housing based on an area’s median family income that is incentivized or subsidized whereas lower-cased a affordable is often referred to as more attainable housing
  • There are approximately 28,000 Affordable units in Austin
  • Household affordability is a family’s house payment of the entire household expense; transportation can increase the further you go out to chase affordability
  • The biggest impediment for Austin to have more affordable housing is finding land that has a full ecosystem that you don’t have to create yourself; you need nearby schools, grocery stores, services, etc. for families to find it truly affordable
  • Obtaining more affordable housing will not happen with one big change; in fact, it’s a whole bunch of little things that need to take place
  • The City of Austin could help increase affordability with expedited permits and lower fees
  • Add more housing stock, preserve more housing stock and get more creative in how we do it

Tiny Houses:

  • Aspen has an issue of having affordable homes for its own employees; tiny homes are hugely successful from a cost-per-bed perspective
  • In Boulder, traditional ways of developing affordable home stock doesn’t work anymore because the cost of labor and materials have gone sky high resulting in too-thin margins
  • Tiny homes can be built in a factory, which means even less impact to existing workforce ecosystem
  • The greatest challenge with tiny houses is local zoning: Cities and counties don’t have their arms around the topic yet under existing codes; the zoning has to be amended
  • Tiny homes are an option for people other than singles: Millennials and baby boomers are the target audience; families are a bit of a challenge for tiny houses but families can still benefit when they move into the empty nesters’ homes

 

Affordable Central Texas (ACT):

  • If you are a current homeowner, you generally like that the value of your home is increasing but if you’re trying to find a home, you are often being forced to leave the area of
  • Government programs haven’t really addressed workforce; ACT is working on a fund to acquire and maintain multi-family properties that provide 60-120% MFI; rental rates will be tied to wage growth; this still provides a return by maximizing occupancy and stable turnover
  • Investors: ACT will be supported from local high-wealth individuals; then expanded to local foundations, banks, individual donors; then go to national banks and investors and institutional capital
  • The goal is to achieve stability: The more stable the income, the more likely kids will stay in school, the less wear and tear on roadways and people will retain jobs

 

Other Notes:

  • It’s challenging to increase supply when entitlements are so difficult to obtain
  • Code NEXT advocates haven’t sold the need for density to support affordability
  • No one entity can bear the burden to solve this problem; if you put the onus on the homebuilder, they will leave; it has to truly be a partnership and everyone has an important role to play; developers and municipalities have gotten too adversary because of Affordability requirements; city leaders need to give staff the tools like waivers and exemptions in a part of a development project to bring in a particular affordable product
  • In Santa Fe, council required 35% Affordability in any new development; in 12 years since the ordinance passes, Santa Fe has had 0% new housing; the intent was good, but there were bad unintended consequences
  • Some communities are doing it right: Salado, Colorado asks what do you developer need us to do to make tiny houses possible; they expedited annexation, created a PUD and offered water tap concessions because tiny houses use less water: they can get six homes on one tap
  • Canada does a good job on affordable housing because they do partnerships better

Mayor Adler, who attended at the end of the breakfast:

  • $1.15 million is the median price in San Francisco; Seattle and Boston vowed not to become San Francisco and established policies, but median price continues to rise to now more than $600K and growing
  • Austin is following in Seattle’s and Boston’s footsteps and, in the process, losing diversity and creativity; we are becoming a city that consumes art, not creates it
  • Workforce housing also has to include workforce development and training; Austin has approximately 40,000 jobs available for people with degrees but we have 40,000 workers who don’t have necessary degrees
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