The problem with affordable housing

[Mud Princess]

MountainTOD, thanks for the link to the Addressing Community Opposition to Affordable Housing Development report -- that's a resource worth adding to my library!

Those articles in the Christian Science Monitor posted by The One highlight the importance of affordable housing as an economic development issue. You can't attract certain types of companies without the availability of labor nearby... and without homes that relocating employees can afford. I see this affecting communities up and down the east coast.

In areas where tourism is the major industry, there is often a shortage of labor because retail and service workers often have to commute from long distances away... and the wages may not be worth the commute.

[wahday]

Since municipalities are democratic and egalitarian, a large influx of less wealthy people will create the possibility of wealth redistribution (in fact affordable housing is one such act)...This will without exception reduce their property value.

Emphasis mine.

Pretty big claim, there - without exception, eh?

Anyway, the following is from the Habitat for Humanity website. A link to the page is below. I'm sure all 11 eleven studies cited must have got it wrong, but maybe you can tell us how...

It is a common assumption that property values will go down in areas where affordable housing is located. Contrary to popular beliefs, studies indicate conclusively that affordable housing has little or no effect on neighboring property values. No one really knows what determines property values -- they are a complex phenomenon, and seem to be most closely related to the condition of the particular property for sale and broad trends in neighborhood prosperity, urban and suburban expansion, road and highway construction and nearby large-scale commercial and industrial developments.

The assumption that property values will decline with the location of affordable housing is based on the idea that one facility can affect a whole neighborhood, and that such facilities will be conspicuous, unattractive, poorly maintained and poorly managed. The studies cited on the following sample bibliography (http://www.habitat.org/how/propertyvalues.aspx)* as well as others show that these assumptions are incorrect.

* I have linked to the page instead of replicating the citations here. They are at the bottom of the page.

[jaws]

Emphasis mine.

Pretty big claim, there - without exception, eh?

Anyway, the following is from the Habitat for Humanity website. A link to the page is below. I'm sure all 11 eleven studies cited must have got it wrong, but maybe you can tell us how...

* I have linked to the page instead of replicating the citations here. They are at the bottom of the page.

This study is worthless. It does not study how the arrival of poorer classes of electors affect incentives for politicians for the whole municipality, which is what I claimed absolutely lowered property values.

Economic impacts can never be "studied" because no controlled experiment can ever be conducted. We don't know how the city's business would have been conducted had there not been affordable housing built, since we don't have access to the alternate universe where it occured. It must be analysed logically.

[wahday]

This study is worthless. It does not study how the arrival of poorer classes of electors affect incentives for politicians for the whole municipality, which is what I claimed absolutely lowered property values.

Economic impacts can never be "studied" because no controlled experiment can ever be conducted. We don't know how the city's business would have been conducted had there not been affordable housing built, since we don't have access to the alternate universe where it occured. It must be analysed logically.

I see. But your assertion that affordable housing will ALWAYS AND WITHOUT EXCEPTION reduce property values is true because...

It swings both ways, jaws. By your logic, reduced property values can be neither proven nor disproven. So, why should people believe your assertion any more than this report? Besides, the report (and it was not a study, but a summary of numerous others - guess you didn't read it very closely) cites 11 studies, whereas you cite none.

Your assertion that economic impacts can never be studied because of a failure to conduct a controlled experiment is a red herring and dismisses a vast body of knowledge that is very valuable to planners. One may make the same argument about a great deal of medical health issues, for example. Because health is impacted by so many complex and interacting factors (diet, activity, genetics, environment, etc.), doctors usually proceed from a pathological angle - observing phenomena and using that as a basis to trace a cause (or causes). This is because they cannot selectively breed humans in captivity in order to achieve a true "controlled" study. But this method of inquiry does not render medicine an invalid enterprise or constitute it as "bad science." The same goes for economics.

Oh, but I forgot - you're never wrong...

[jaws]

I see. But your assertion that affordable housing will ALWAYS AND WITHOUT EXCEPTION reduce property values is true because...

It swings both ways, jaws. By your logic, reduced property values can be neither proven nor disproven. So, why should people believe your assertion any more than this report? Besides, the report (and it was not a study, but a summary of numerous others - guess you didn't read it very closely) cites 11 studies, whereas you cite none.

Because it is proven logically. You could cite me 11 studies about how banana peels on the sidewalk cause property values to go up, it would be about as relevant as the studies you did cite.

Your assertion that economic impacts can never be studied because of a failure to conduct a controlled experiment is a red herring and dismisses a vast body of knowledge that is very valuable to planners. One may make the same argument about a great deal of medical health issues, for example. Because health is impacted by so many complex and interacting factors (diet, activity, genetics, environment, etc.), doctors usually proceed from a pathological angle - observing phenomena and using that as a basis to trace a cause (or causes). This is because they cannot selectively breed humans in captivity in order to achieve a true "controlled" study. But this method of inquiry does not render medicine an invalid enterprise or constitute it as "bad science." The same goes for economics.

Oh, but I forgot - you're never wrong...

You can create a random sample of subjects in a medical experiment, thus isolating outcomes against a control group. You can neither have an experiment nor a control group in economics. Your vast body of knowledge has no knowledge in it, it is only a historical study.

I'm saying that over decades the arrival of a low-income population in a democratic jurisdiction will cause elected politicians to shift spending from the high income population to this new low income population, without getting additional revenue in proportion. This will without exception lower the property values of the initial residents.

Now instead of criticising the logic of this, you give me studies that show that over a short timespan property values in areas neighboring the affordable housing projects were not observed to go down. Firstly it is not at all the phenomenon I was talking about, and secondly there are a million factors that affect property prices that are at play here, most notably monetary policy of the government.

Even if all property prices in a community with affordable housing were to go up 1000%, I would still be correct in saying that property values were lowered by affordable housing, because for all we know they may have gone 1100% without affordable housing.

[planner?]

Jaws- This is a weak arguement. I would be interested to find out how different the municipal funding priorities of low and moderate income people differ from higher income people.

Further, these projects are typically not creating a concentration of poverty or else their wouldn't be NIMBYism. Given the size of this population arguing that they would take over the political agenda is also weak.

Assuming that poor people have different municipal priorities and that they do take over the politicical agenda it is still questionable that the resultant policies would actually lower property values.

Affordable housing may actually reduce expenditures in other areas including medical, social service, police, etc. which may result in lower property taxes which actually DO result in higher property values.

[Mastiff]

Because it is proven logically. You could cite me 11 studies about how banana peels on the sidewalk cause property values to go up, it would be about as relevant as the studies you did cite.

Let me get this straight... In an argument about affordable housing, and more narrowly between you and Wahday, property values, studies entitled Relations between Affordable Housing Development and Property Values and Impact of Affordable Housing on Property Values aren't relevant? And further, since you have come to your own conclusions, they are the correct conclusions?

So, it's Jaws Logic versus studies by Coopers & Lybrand, University of California Institute for Urban and Regional Development, State of California Department of Housing and Community Development, The Maryland-National Capital Park and Planning Commission, Spear Street Advisors, Inc., and Lynn Sedway & Associates.

Hmmm... I think I'm going to have to pass on the "logical conclusions" of one person who seems to believe himself omniscient, and go with the fact based studies on the issue.

[Rewey]

Sometimes the issue has nothing to do with the rise and fall of property values due to the inclusion of affordable housing in an area.

In Perth, Western Australia, a similar case was proposed in a swank inner-city suburb called Subiaco. The idea was to build a number of affordable housing complexes in amongst the very pricy townhouses.

The main issue that raged in the papers over here had little to do with house prices being affected. It had to do with the basic argument that some people work very hard all their lives to be able to afford to move in to, and therefore enjoy the lifestyle provided by, a prestigious inner-city suburb. All of a sudden, other people are having their way paved by the state governments. This also means that for those who are looking to move in to the area after their years of work, there are fewer places available.

Sometimes the most complex political arguments can be watered down to the basic human ideal of what is fair...

Rewey

[AubieTurtle]

The problem with that argument if it is that it seems to be based on level of effort a person has exerted in life to be successful. There are plenty of janitors and maids who work much harder than professional athletes but I doubt that the people who feel they deserve to be separated from the poor based on level of effort are going to like a system to rewards each based on the difficulty of their work rather than on the market value for said work. I suspect that most people would be rather disappointed in their station in life if it was based on effort rather than the economic value of that effort.

Ultimately I think most government subsidized housing is going to fall short of its goals. Mixed income zoning, allowing a developer to put in an apartment complex in 400 units of 800 sq ft each in the same area as 4500 sq ft houses will do more to create affordable housing than any government built or subsidized housing program. Easing the restrictions on dwelling units like granny flats also helps, but lets face it, this isn't about the fairness of government subsidizes, it's about using the power of government to create economic restriction zones. Most free-market anti-government interference types suddenly turn into the biggest fascists when they hear a property owner nearby is going to build housing that costs less than what they live in.

[jresta]

The problem with that argument if it is that it seems to be based on level of effort a person has exerted in life to be successful. There are plenty of janitors and maids who work much harder than professional athletes but I doubt that the people who feel they deserve to be separated from the poor based on level of effort are going to like a system to rewards each based on the difficulty of their work rather than on the market value for said work. I suspect that most people would be rather disappointed in their station in life if it was based on effort rather than the economic value of that effort.

I'm not sure if i read you right because it looks like you switched a few key words but . . .

as the saying goes "you don't get rich by workin' . . . you get rich by having other people work for you

Anyone ever read any Michael Albert? http://www.parecon.org/writings/faq.htm
A little too controlling and commie for me but pertinent to this discussion.

The days i put in at the restaurant are by far much more challenging and physically demanding than most of the the work days put in by the clientelle. Yet i'm sure that 90% of them make far more per hour than i could ever imagine.

I have to disagree that most people would be unhappy if they had to take the value of their effort over the economic value of their work. Most people don't get paid $300 an hour for telling people they have no chance in hell of winning a legal battle. Most people bust their asses and get paid $8 an hour for stocking shelves or washing dishes. That work is actually worth quite a bit but the remuneration for such is much less than it should be because most of it is being siphoned off as "profit."

Ultimately I think most government subsidized housing is going to fall short of its goals. Mixed income zoning, allowing a developer to put in an apartment complex in 400 units of 800 sq ft each in the same area as 4500 sq ft houses will do more to create affordable housing than any government built or subsidized housing program. Easing the restrictions on dwelling units like granny flats also helps, but lets face it, this isn't about the fairness of government subsidizes, it's about using the power of government to create economic restriction zones. Most free-market anti-government interference types suddenly turn into the biggest fascists when they hear a property owner nearby is going to build housing that costs less than what they live in.

Here we agree, i would only add that, local governments shouldn't hesitate in requiring contributions, from developers reaping huge profits on McMansions or luxe condos, for affordable units. Without recognizing the fact that the "market" is squeezing the middle and working class out of existence we're just moving, every day, a step closer to being the new Brazil.

[jaws]

Let me get this straight... In an argument about affordable housing, and more narrowly between you and Wahday, property values, studies entitled Relations between Affordable Housing Development and Property Values and Impact of Affordable Housing on Property Values aren't relevant? And further, since you have come to your own conclusions, they are the correct conclusions?

So, it's Jaws Logic versus studies by Coopers & Lybrand, University of California Institute for Urban and Regional Development, State of California Department of Housing and Community Development, The Maryland-National Capital Park and Planning Commission, Spear Street Advisors, Inc., and Lynn Sedway & Associates.

You made a blind appeal to authority to a study which did not study the effect I claimed existed. It's logic versus your logical fallacies, therefore no contest.

The days i put in at the restaurant are by far much more challenging and physically demanding than most of the the work days put in by the clientelle. Yet i'm sure that 90% of them make far more per hour than i could ever imagine.

I have to disagree that most people would be unhappy if they had to take the value of their effort over the economic value of their work. Most people don't get paid $300 an hour for telling people they have no chance in hell of winning a legal battle. Most people bust their asses and get paid $8 an hour for stocking shelves or washing dishes. That work is actually worth quite a bit but the remuneration for such is much less than it should be because most of it is being siphoned off as "profit."

There are more people who need to know if they can win a legal battle, and fewer people able to tell them so, than there are people who need shelves stocked and people able to do so. It's irrelevant what the work is "worth" or how hard it is, all that matters is who needs what.

If you want to screw over the 300$ an hour lawyer, you're going to be screwing over all the people who needed that lawyer bad enough to pay him 300$ an hour as well.

If you want to screw over a store owner that pays his shelf stackers 8$ an hour, you're going to be screwing over all the employees that need the 8$ an hour job as well.

That's how things work in an exchange economy. Everybody needs everybody else.

Easing the restrictions on dwelling units like granny flats also helps, but lets face it, this isn't about the fairness of government subsidizes, it's about using the power of government to create economic restriction zones. Most free-market anti-government interference types suddenly turn into the biggest fascists when they hear a property owner nearby is going to build housing that costs less than what they live in.

Fascism was a reaction against communism. When you're stuck fighting in a system that deprives you of your rights, you have to turn your opponent's weapons against him. Democratic ownership means that any arrival of low-income residents dilutes the value of the high-income people's vote. The best way to deal with that is to keep them out, no matter the cost.

Were it not for democracy, there wouldn't be any such problem. Servants used to live in the same house as the families they served, or in servants' quarters at the back of the lots.

Assuming that poor people have different municipal priorities and that they do take over the politicical agenda it is still questionable that the resultant policies would actually lower property values.

Affordable housing may actually reduce expenditures in other areas including medical, social service, police, etc. which may result in lower property taxes which actually DO result in higher property values.

If property owners are paying the same tax rates and getting fewer services for them (the service has been diluted to a greater number of people) then this definitely, without a doubt lowers property values.

It is possible that economies of scale lower tax rates. However the tax savings will be spent equally among the voters, meaning that the rich residents get less than their share of the economies of scale in returns, while poor residents get more than their share.

[sundanceplanner]

Can affordable housing be built for or by those that supply the labor to the million dollar home owners without being Habitat housing?

[MacheteJames]

Can affordable housing be built for or by those that supply the labor to the million dollar home owners without being Habitat housing?

Not sure what you mean by this. "Those who supply the labor?" Are you asking if private developers can build both market-rate and affordable housing?

[Mastiff]

You made a blind appeal to authority to a study which did not study the effect I claimed existed. It's logic versus your logical fallacies, therefore no contest.

First, I made no appeal at all. I just noted that certain studies counter your statement that "[c]urrent residents will suffer higher taxes while not getting service in proportion to these higher taxes, services that will go to the less wealthy residents. This will without exception reduce their property value."

You said it. You have nothing to back it up but your own "logic." Then, to top it off, you say it cannot be studied. Well, it has been studied, and the conclusions are that affordable housing does not cause a decrease in property values. If you really want to argue a point that their property values would have increased more without the development, you'll have to do better than "because I say so" to convince any rational person.

Here, let me try my hand at "jaws logic"...

Current residents will enjoy lower taxes and get better service in proportion to those lower taxes, because the services are provided at a lower rate of pay due to the less wealthy residents. This will, without exception, increase their property value.

Wow! That was easy! I can just make up stuff, too!

[jaws]

First, I made no appeal at all. I just noted that certain studies counter your statement that "[c]urrent residents will suffer higher taxes while not getting service in proportion to these higher taxes, services that will go to the less wealthy residents. This will without exception reduce their property value."

You said it. You have nothing to back it up but your own "logic." Then, to top it off, you say it cannot be studied. Well, it has been studied, and the conclusions are that affordable housing does not cause a decrease in property values. If you really want to argue a point that their property values would have increased more without the development, you'll have to do better than "because I say so" to convince any rational person.

Well, that's how causality works. You have a study that says that property prices were higher after affordable housing than before. But so what? We're not looking for a before-after comparison. We're looking for an affordable housing-no affordable housing comparison. To actually prove me wrong, you would have to present a study that showed that in the alternative universe where the other choice was made and all other variables kept constant, the property prices were higher with affordable housing than without.

Since this is impossible, the argument can only be evaluated logically. Either what I said is logically true, or something I said is logically false. The only way to refute my logic is with logic.

Here, let me try my hand at "jaws logic"...

Current residents will enjoy lower taxes and get better service in proportion to those lower taxes, because the services are provided at a lower rate of pay due to the less wealthy residents. This will, without exception, increase their property value.

Wow! That was easy! I can just make up stuff, too!

You are getting close to an actual argument. The flaw in the logic is this: because employees can commute, they can live in a separate democratic jurisdiction than the one they work in. Their physical residence in affordable housing therefore has negligible if no impact on labor prices for services, while creating new expenditures in services by the democratic jurisdiction, such as, for example, schools. Since per-child expenditures are divided equally by child, and taxation to fund these schools falls linearly on more valuable properties, the wealthy residents will see expenditures on their own children reduced and reallocated to children of non-wealthy residents.

As you can see, I did not provide a "study" showing that affordable housing reduced salaries in the areas where it is provided. Obviously in an era of permanent inflation such a study would never arrive at a result that demonstrated your theory as correct. No matter, I did evaluate the logic of your statement and pointed out its error. That is how logical argumentation is done.

[Mastiff]

The flaw in the logic is this:

Nope. There is no flaw in my logic. You cannot prove it, I am right.

You say "they can live in a separate democratic jurisdiction than the one they work in. Their physical residence in affordable housing therefore has negligible if no impact on labor prices for services."

I say, the cost of the commute is high, thus raising the cost of services, and raising the taxes of the residents.



You say, "[s]ince per-child expenditures are divided equally by child, and taxation to fund these schools falls linearly on more valuable properties, the wealthy residents will see expenditures on their own children reduced and reallocated to children of non-wealthy residents."

I say, the wealthy have more time on their hands, and are either more prone to procreate with their mate or other persons, and have a larger burden on the school system. Thus, they pay less than their share.

Or, the affordable housing is all one bedroom, and less likely to draw families with children. How about that one?


Kind of fun not having to back up your "logic" with any factual data, huh?

(I didn't provide a "study" either... Welcome to JawsWorld.)

[Meyre]

Or, the affordable housing is all one bedroom, and less likely to draw families with children. How about that one?

Unfortunately, "affordable" housing seems to be most needed by those who are unable to control their procreative urges, or those who deliberately produce more offspring to increase their welfare payments. Unless you have ordinances limiting the number of persons allowed in a single-bedroom dwelling, you would most likely end up with 6-8 people squashed into a teeny apartment, and the "affordable housing" would have overtones of New Delhi. If you had the ordinances, you would probably not be able to fill the housing with qualified tenants, because those qualifying due to income would have too many family members to fit the allocated space. Then, you would probably have lawsuits brought against you for discriminatory housing practices, and might then be forced to add units for larger families, and you would simply wind up where you started in the first place.

Regards,
Meyre

[MacheteJames]

Unfortunately, "affordable" housing seems to be most needed by those who are unable to control their procreative urges, or those who deliberately produce more offspring to increase their welfare payments. Unless you have ordinances limiting the number of persons allowed in a single-bedroom dwelling, you would most likely end up with 6-8 people squashed into a teeny apartment, and the "affordable housing" would have overtones of New Delhi. If you had the ordinances, you would probably not be able to fill the housing with qualified tenants, because those qualifying due to income would have too many family members to fit the allocated space. Then, you would probably have lawsuits brought against you for discriminatory housing practices, and might then be forced to add units for larger families, and you would simply wind up where you started in the first place.

Regards,
Meyre

What an absolutely asinine argument. I develop low income housing for a living, and the properties we develop and manage are a far cry from anything you'll find in New Delhi or a Brazilian favela. There are multiple housing markets within this country in which a majority of those working "regular jobs", (i.e teachers, custodians, retail workers) cannot afford housing if one uses the usual standard of 30% of monthly income toward housing costs. Hell, with the housing market I live in, I am one of them myself - which is why I live with multiple roommates. "Procreative urges" haven't a thing to do with it, and all I can do is roll my eyes at the fact that you trotted out the old "welfare queen" strawman...that's little more than coded racism & classism in my eyes.

[Gedunker]

The issue of race threatens to take the thread irretrievably off-topic. Debate the idea, not the individual. Be civil, and stay on-topic. Carry on.

[MacheteJames]

The issue of race threatens to take the thread irretrievably off-topic. Debate the idea, not the individual. Be civil, and stay on-topic. Carry on.

You're right, and I apologize for escalating things. It's a topic that I'm passionate about, and at times, I can let it get the best of me.

[Tide]

One thing that I don't think has been mentioned (I only read the first half dozen posts and perused the others minus Jaws') is the fact that afforable housing usually has short cuts in the construction process to make it more affordable to build since the developer usually takes, not necessarily a loss but at least breaks even building it. Single pane windows, the most basic fixtures and stove/fridge are included. Often thinner sheet rock or single layer insulation when the 'higher end' units have double is often substituted, legally according to code, in affordable units. This in turn creates a larger utility bill for heating and cooling on these units as would a comparable market unit.

Just something else to mull over.

My opinion is multiple incomes and backgrounds should be able to live around each other, however the market usually prices people out. The government or developer in this case is only trying to battle market forces which is honorable since the government has failed time and time again at stratifying the marketplace.

[jaws]

Nope. There is no flaw in my logic. You cannot prove it, I am right.

You cannot claim that 2+2=3 because the contrary cannot be proven. It can in fact be logically demonstrated that you are wrong.

Or, the affordable housing is all one bedroom, and less likely to draw families with children. How about that one?

That would be logically correct, yes. Logically, this kind of housing would not increase school expenditures.

However, there are still going to be redistributive impacts by the arrival of low-wealth voters. It is logically implied in the nature of the egalitarian one-man one-vote system.

[ofos]

I love it! I've been out of grad school for 30 years and y'all have brought back to life all the asininely hypothetical theories and arguments that we debated over too many beers. Don't stop, it's deja vu all over again!

[sundanceplanner]

Not sure what you mean by this. "Those who supply the labor?" Are you asking if private developers can build both market-rate and affordable housing?

no, I was referring to the lower paid citizens that provide the kllawn care, sitting with home bound and such as that

[AubieTurtle]

I love it! I've been out of grad school for 30 years and y'all have brought back to life all the asininely hypothetical theories and arguments that we debated over too many beers. Don't stop, it's deja vu all over again!

Just because you learned something long ago doesn't mean that the next generation magically has that information in their brains. Much of human knowledge is debated over and over again throughout history. As someone who feels that you've already learned the wisdom that there is to learn on this subject, you would do much better to share that wisdom with the rest of us instead of mocking people for not figuring out on their own what you have admitted took you debates during grad school to learn.