Last week, the mayors of Chapel Hill and Carrboro held a press conference to
wring their hands over the affordable housing crisis wrought by owner/investors of workforce apartment complexes no longer accepting Section 8 vouchers because those owner/investors realized they could install granite countertops and double the rent.
While the mayors were pleading with those investor groups to have a heart and save some affordable units, Realtor and former chair of the Chapel Hill-Carrboro Chamber of Commerce Mark Zimmerman was penning his own exhortation, to individual homeowners to renovate or “redevelop” their homes in order to raise the price of residential real estate.
The mayors want a diverse community that has room for people of all income levels. The former chair of the chamber representing both towns wants to keep real estate prices high so the towns reap more property tax revenue.
While we don’t know yet what strategy the mayors have in mind for ensuring that modestly paid residents aren’t forced out of our little burgs, I fear their efforts will be undermined if the 1,300-plus Chamber members and the 500-plus real estate agents work to further Zimmerman’s goals.
Home prices in Chapel Hill have leveled off this year, while prices have increased in surrounding towns. Traditionally, Chapel Hill’s excellent schools, quaint village atmosphere and liberal-minded views of community members looking out for one another brought people to town. Folks were willing to pay more to be part of what makes our community special.
Zimmerman notes that prospective buyers may no longer see the value of living in Chapel Hill. He believes home buyers want only big, new houses with granite countertops. Perhaps that’s true for restless high-income buyers or executives stopping here temporarily on their way up the career ladder. If so, they can find their dream homes in Durham, Chatham County and towns in Wake County for less. Renovating an older home in Chapel Hill and raising the price won’t make us competitive with surrounding towns unless the town of Chapel Hill itself is a draw.
Chapel Hill used to attract people looking not so much for a house but a home. Our town had and still does have a supply of solidly built older homes, functional rather than fancy, affordable to people who chose careers based on priorities other than high pay. And we have a number of residents who don’t believe that quality inventory should be replaced with houses and high-rises sheathed in particle board, constructed of products designed to be replaced frequently, and built by developers who sanction cutting corners to boost their profit margin.
Home buyers can get granite countertops anywhere. An inclusive, caring community that provides a top-notch education to all children is far more rare. Do we want to give that up?
– Nancy Oates
Fred Black
/ August 11, 2014I think you meant to say that Mark Zimmerman is a past chair of the Chapel Hill – Carrboro Chamber of Commerce. Also, there are more than a few Chamber member organizations and individuals who are working very hard to improve to affordable housing situation.
Terri
/ August 11, 2014The problem with the “affordable” housing crisis in my opinion is that there are so many, widely varying definitions of ‘affordable.’ Section 8 makes housing available to those with very low income (~$25,000/year). Inclusive zoning makes units available for slightly higher incomes, but developers just bump up the cost of their full-priced units to offset those lower cost units. And in the meantime, much of what used to be middle-income housing is being renovated to match the prices of the market-rate units. Where does all this leave middle-income home buyers? IMHO we need to stop using ‘affordable’ to mean low-income/subsidized housing or this is going to become an even more economically bifurcated community (rich and poor, no one in the middle).
Nancy
/ August 11, 2014Thanks for the correction, Fred. I got the information from Mark’s LinkedIn page, and I should have taken the time to cross-check it with the chamber website. I’d love to hear from chamber members about what they’re doing to promote affordable housing. The more people we have in the community working toward this goal the better.
Fred Black
/ August 11, 2014Talk to Robert Dowling and Delores Bailey for starters.
Nancy
/ August 11, 2014But Fred, that’s their job. Do you know whether anyone not paid to advocate for affordable housing is doing anything toward that goal? Maybe a developer who would be in a position to provide some affordable housing? Or creative incentives by chamber members to increase the inventory of affordable housing?
Fred Black
/ August 11, 2014“I fear their efforts will be undermined if the 1,300-plus Chamber members and the 500-plus real estate agents work to further Zimmerman’s goals.”
Yes it is what they do and their organizations are members, but you speak of the Chamber as a monolith and it just isn’t. Several more mmembers are very involved. Give Aaron a call.
many
/ August 11, 2014Never mind Nancy, Mebane has it covered.
http://myfox8.com/2014/08/07/mebane-seeing-a-housing-boom/
300+ apartments right off the highway and the the old White Furniture building downtown, is renovating 157 units. To Terri’s point; I am not sure how many are “market rate”, but as we have already established the definition of “market rate” is different.
There are over 1,400 people in the Mebane zip code who work at Duke and UNC, based on housing alone we can expect that number to rise. Too bad we allocated so many scarce dollars on TTA’s LRT. I wonder where all the commuters will park?
Nancy
/ August 11, 2014So Mebane’s motto is “Positively charming.” Isn’t that how people used to describe Chapel Hill?
CitizenWill
/ August 11, 2014Nancy, one of your best.
You couldn’t have done a better job summing up the reason Ellie and I chose Chapel Hill: “Chapel Hill used to attract people looking not so much for a house but a home.”
Chapel Hill is our home which is why I find the last 5 years of political machinations so disheartening.
Bruce Springsteen
/ August 12, 2014How can an area that constantly emphasizes affordable housing have an affordable housing crisis while nearby areas that don’t constantly emphasize affordable housing not have an affordable housing crisis?
Mark Zimmerman
/ August 12, 2014Hi Nancy,
I’m sure you’re not suggesting we solve the Mayors’ affordable housing issue by allowing our current stock of single family homes to deteriorate to the point that Section 8 voucher families can pay for them.
All I want to spotlight is what Realtors see every day. A lot of our housing stock is very old and increasingly doesn’t compete well with newer housing being built around us. The town should look to ways to make it easier for families to improve their property. Pretty simple. Since the average price of a current home in Chapel Hill is in the high $300,000’s, this can’t be part of the affordable housing fix no matter what.
Affordable housing is an entirely different issue. I’ve written many times about the unintended consequences of our restrictions on supply driving out low income families. It’s gotten to the point that the resulting high land prices and the often onerous cost of development here make market solutions for the poorest segments of the community unlikely. The Mayors’ are going to have to proactively fund public assisted housing if we want to stay as diverse as we had been.
But that, as I said, is a different story, not at all what I was trying to address in this piece.
JWJ
/ August 12, 2014Just wanted to note that I thought Terri’s comment was a very good one.
Various definitions of affordable housing can be a little confusing. And the comment not to forget about “middle income” folks. Especially those family units making between $60K to $100K. A diverse community needs groups from all income levels.
Nancy
/ August 12, 2014Mark — I wasn’t aware that the town made it difficult for individual homeowners to renovate or add on to their homes. What is the main obstacle? Do you think the new permitting center will make a difference?
Section 8 rent caps are too low to apply to houses. Even apartment owners say the caps are too low. My point is more the mindset of landlords and others in the real estate industry about the desire to make as much profit as possible. I’m uncomfortable by your implication that Section 8 housing must be rundown. The Timberlyne Apartments, for instance, provided well-maintained, safe units that accepted federal subsidies for some tenants. Eller Properties took over and decided it had to maximize rent on every unit and would not accept Section 8 for any of them.
I’ve set up my business to make a profit, not a killing. And I’d like to see landlords accept a handful of Section 8 tenants so that the town can retain some socio-economic diversity. My husband tells me I’m naive. But I don’t think I’m the only one in town who does not put making money at the top of their priority list.
DOM
/ August 12, 2014Nancy –
“I wasn’t aware the town made it difficult for individual homeowners to renovate or add on to their homes.”
Really, Nancy? You should take a look at the majority of RCD’s in Chapel Hill. Most of these districts (with the exception of Northside, for example) were created by wealthy homeowners who were concerned their property values would be diminished if less expensive residences were built in their neighborhood. The Greenwood RCD, for instance, requires a minimum of ONE ACRE to build a home. How elitist is that? This restriction in a neighborhood within easy walking distance of UNC, a neighborhood that could potentially provide moderately-priced housing for hundreds of University employees if homeowners weren’t quite so interested in keeping their property values skyrocketing.
We as residents may say we want more affordable housing in this town, but until the wealthy homeowners on their half-acre-plus lots stop doing everything in their power to keep their property values as high as possible – it’s just a lot of empty words.
CitizenWill
/ August 12, 2014NCD – Neighborhood Conservation District
http://www.townofchapelhill.org/index.aspx?page=570
Zoning overlay meant to enhance and preserve a neighborhood’s unique characteristics.
RCD – Resource Conservation District
http://www.townofchapelhill.org/index.aspx?page=410
Zoning overlay meant to minimize new developments impact on flooding, stream quality, etc. A functional RCD would limit new developers from externalizing their costs onto taxpayers. Current RCD has been gutted to some extent. And since basic supporting work – like a master stormwater plan for Booker Creek/EF/etc. or a future flood plan that integrates anticipated climate changes – is missing, is further hobbled.
Nancy
/ August 12, 2014Mark — Weren’t you part of a group of Realtors who formed an investment group maybe 8-10 years ago that bought houses, renovated them, and put them back on the market for significantly more than your investment? Is it harder to do that now than it was a decade ago? If so, wouldn’t it be more prudent for the buyer to be the one to invest in renovation, because the sellers won’t be able to enjoy the renovation or get back their investment?
DOM
/ August 12, 2014Oops, my mistake. I DID mean to say NCD. I’d also say the current NCD has been gutted as well.
Thanks, Will.
Don Evans
/ August 12, 2014Funny, I’ve never heard of a homeowner having issues with getting permits to renovate. Mark, could you cite three examples?
Maybe you’re referring to those homeowners who want to turn their properties into six- or eight-student housing in neighborhoods such as Northside. Yeah, those homeowners complain a lot because they cannot make a 300 percent profit on their investment while screwing up affordable neighborhoods. No intention of living there, mind you.
Whenever real estate agents or property owners start whining about the regulations, you know they are not advocating for inclusion or neighborhoods or community improvement — they are more concerned about making a quick buck.
As far as affordable housing is concerned, Mayor Kleinschmidt and his Town Council have done more to cut the stock of affordable housing in Chapel Hill than any developer ever dreamed of. Their decisions on redevelopment and rezoning have devastated affordable housing. I find it ludicrous that the mayor would have the effrontery to bemoan the affordable housing situation in Chapel Hill while he does his utmost to reduce its availability.
Mark Zimmerman
/ August 12, 2014Nancy,
I have not invested in houses, renovated houses or resold houses. The only homes I’ve ever bought and sold are the few in which I’ve resided.
Mark
DOM
/ August 12, 2014Don,
Are there really any “affordable neighborhoods” left in Chapel Hill? Until we change some of the R-1 zoning restrictions in town, we’re left with nothing but single-family houses on large lots in exclusive neighborhoods. Doesn’t that discourage any kind of true affordability?
many
/ August 13, 2014I think Don’s points are valid, but I also think the effects are more the result of a lack of vision translated to policy than malice of aforethought. It is logically impossible to do anything about the past except learn from it.
Following the discussion leads me to the conclusion that if the goal is indeed to both raise additional tax revenue and address the lack of housing inventory, the Ephesus-Fordham development should be supported.
That said, I would still like to see firm linkage to solving past infrastructure mistakes and a substantial analysis of the puts and takes along with risks. For example I for one still have significant concern over demand being able to absorb the amount of development being approved within a 20 mile radius.
Managing expectations; Ephesus-Fordham development is not likely to solve the affordability problem, but it at least provides an avenue for hope through increased inventory and competition.
Fred Black
/ August 13, 2014Nancy, in addition to the Town’s Affordable Housing strategy, the rental strategy, and the inclusionary zoning ordinance, (http://townofchapelhill.org/index.aspx?page=567)
What else do you suggest be done?
Nancy
/ August 13, 2014Fred — They look fantastic on paper, and unfortunately, that’s where they remain. The Affordable Housing Strategy is full of “explore,” “research,” “evaluate,” “consider,” which is all well and good but at some point needs to translate into “implement.” Same with the Affordable Rental Strategy. One of its priorities is to shorten the approval process for affordable housing ventures. But what does the town do? Shorten the approval process for developers who build high-end rentals. Another priority is to grow the commercial tax base. But the town instead has grown revenue-neutral or revenue-negative residential real estate projects. While town leaders fret about what to do, developers are snapping up all available land and converting it to high-cost housing.
Terri
/ August 13, 2014Fred, One approach that’s being tried in other communities is called performance based zoning. Instead of treating all zoning issues as aesthetics, they are setting goals for the developer to meet relating to jobs created, affordable housing created, low carbon footprint, etc. It’s still considered conditional use, but the developer is tasked with meeting the goals, not following a bunch of rules that either cede too much control or regulate so tightly that development is unaffordable. http://www.citylab.com/housing/2014/08/braving-the-new-world-of-performance-based-zoning/375926/
Fred Black
/ August 13, 2014Nancy, still not sure what you would do.
Terri, sat through a presentation on PBZ. Seems like it’s in the “too hard box” here and part of what makes it so are the legal issues. Other ideas?
Terri
/ August 13, 2014What are your ideas, Fred?
Fred Black
/ August 13, 2014Terri, I’m still pushing more land purchases with assistance from the towns so our agencies can build more, making it more viable for builders to include affordable units, and more units owned by the towns. Much hard work ahead!
Nancy
/ August 13, 2014I’m glad you’re advocating for that, Fred. The town has several parcels it’s willing to sell. If it could partner with reputable developers of workforce housing to provide safe, well-maintained units, that would be a good start.
Bonnie
/ August 14, 2014I’m pretty confused here. Are we talking alternatives to section 8 housing (the mayor’s dilemma) or workforce housing (aka “middle class” in Mebane, and surrounding counties).
Some good points raised by Don and Many about student housing and how Ch Hill will compete with the dense, affordable development that’s all around us. Will you ask your taxpayers to subidize the difference?
Mark Marcoplos
/ August 16, 2014In addition to other strategies, another angle to work on is promoting a living wage. The Chamber could take a leadership role. As a builder I know how expensive construction is, even when keeping costs down is a priority. The fact is that one of the main reasons there is a lack of enough affordable housing is that many people just cannot afford them. Our economy is out of whack if people who work full-time jobs are not being paid enough to afford a modest home.
David Schwartz
/ August 16, 2014A commenter above asks: “Are there really any “affordable neighborhoods” left in Chapel Hill? Until we change some of the R-1 zoning restrictions in town, we’re left with nothing but single-family houses on large lots in exclusive neighborhoods. Doesn’t that discourage any kind of true affordability?”
Yes, there are still some left. My neighborhood, Little Ridgefield, for example. Well-built 1950s-era 3-bedroom ranch houses on quarter-acre lots, walking distance to University Mall, Community Park, Rainbow soccer fields, Whole Foods, Ridgewood Pool, etc. Prices in the low $200,000s, well below Chapel Hill’s median home price. And we just adopted an NCD, not because we are concerned our property values would be diminished if less expensive residences were built in our neighborhood, as one misinformed commenter suggested, but to protect ourselves against predatory developers and their Town Council allies who might see our neighborhood of modest “underperforming” real estate as the next place ripe for “renewal.”