Housing News Roundup: September 14, 2016
Deep Transit Discounts through Affordable Housing Transit Pass Pilot
In the Seattle region, property managers can buy transit passes for their residents at deep discounts through King County Metro’s Multifamily Development Passport Program. With funds from the Seattle Department of Transportation (SDOT), Capitol Hill Housing will offer the discounted cards for a one-year pilot period to residents in three of its affordable housing properties. SDOT’s funds will cover half of the already discounted pass rates, leaving residents to pay just $10 to $17 per month for unlimited rides. “Some people might think it’s strange that an affordable housing organization is working on transit,” says Ashwin Warrior, Capitol Hill Housing’s communications manager. “But when you really think about what it takes to have strong, diverse, equitable communities, you can’t think about housing in a silo. Transit can have just as big an impact on our residents as everything else we’re facing.”
Source: Next City
Despite Lack of Permanence, California Insurance Premium Reinvestment Program Has Big Impacts
For 20 years, the California Organized Investment Network (COIN) has encouraged insurance companies to reinvest pooled insurance premiums in activities that benefit low- and moderate-income areas. The voluntary program does not have permanent authorization. Companies participate in part because of the Community Investment Survey Data Call, which makes public all data on firms’ participation in the program. COIN investors can also receive a community development financial institution state tax credit, which had long been underutilized but was revamped around five years ago. Both provisions face reauthorization, limiting the program’s ability to encourage participation by insurance programs. Between 2011 and 2015, the program has yielded $237.5 million in investments to 34 organizations for activities that benefit underserved populations. Among other uses, the funds have supported creating 12,000 units of affordable housing. COIN investments account for 76 percent of all capital invested in California’s low- and moderate-income areas. “I just think it’s a different program if it’s permanent, the way people engage with it, how it would be viewed internally by policymakers as well. Maybe if the program were more permanent, it would be more of a model to be replicated,” says Tom Woelfel, director of Pacific Community Ventures InSight, a firm that worked on the COIN impact report.
Source: Next City
Shortage of Construction Workers Hinders New Home Building
The Great Recession forced many construction workers into new professions, triggering a labor shortage for homebuilding companies. Because of the financial crisis, approximately 30 percent of construction workers found jobs in different fields. With almost 200,000 construction jobs now vacant, construction firms struggle to attract new employees and retain their current workforce. The need for highly skilled training and the lack of job security keep many from entering the field and fail to entice former construction workers back to the profession. This labor shortage is preventing the new supply of homes from keeping pace with increased demand. Labor costs have risen, causing homebuilding companies to only construct more expensive homes and not lower-cost starter homes because of concerns about profit margins.
Source: St. Louis Post-Dispatch
Denver’s City Council Must Decide between Competing Funding Plans for Affordable Housing
The Denver City Council is debating two affordable housing funding plans aimed at generating $150 million to preserve or build 6,000 additional units of affordable housing over 10 years. Both measures passed an initial vote. One proposal would use revenue generated from a property tax increase and the imposition of impact fees to establish a consistent funding stream for the plan. The other piece of legislation would delay the revenue-generating measures for an additional year to further study the economic impacts and would provide $20 million immediately from the city’s general fund. The latter legislation sought to assuage two factions: people concerned about the fee’s potential to slow down new development in an already tight market and people who want the plan to do more and do so quickly. “I think the exciting thing today is that there is not a person on the dais who is not an affordable housing advocate,” said Councilwoman Debbie Ortega. The public can voice their opinions about each measure before the final vote next week.
Source: The Denver Post
More Affordable Housing Could Reduce Deaths among People Experiencing Homelessness
An annual report reveals a significant increase in the number of deaths among people experiencing homelessness in Portland, Oregon. According to the Multnomah County Health Department, 88 homeless people died last year, up from 56 deaths in 2014. A quarter died from natural causes while half the deaths were related to drug and alcohol use. According to Israel Bayer of Street Roots, the life expectancies among the homeless population “are numbers you read of death rates in the 19th century. It’s a tale of how…traumatic the experience of homelessness is.” The report advocates for increased mental, health, and first-aid programs, and calls for increased affordable housing. Advocates in Portland seek solutions from programs in other states, such as Utah, which decreased homelessness by 75 percent by providing permanent housing. The Oregon legislature increased funding for affordable housing in its last session, and a ballot initiative in Portland could raise $258 million for affordable housing in the metropolitan area if passed in November. Deborah Kafoury, the Multnomah County chair, states the problem simply: “As long as people are living on the street, they’re more likely going to be dying on the street.”
Source: Portland Tribune
US Census Report Reveals Drop in Poverty Rate
The US Census recently issued its report on household incomes in 2015. The new statistics reveal a decrease in the poverty rate from 14.8 percent in 2014 to 13.5 percent in 2015. While showing signs of economic recovery, this figure still exceeded the poverty rate in 2008, the year the Great Recession began. Additionally, median household income rose 5.2 percent, the largest one-year increase since 1967. According to Lawrence Mishel of the Economic Policy Institute, “Wages and incomes took a big battering that we’re just now recouping, and you could say there’s no Super Bowl parade, but this is really superb growth.”
Source: The Wall Street Journal
Vacancy Rates Continue to Drop
RealtyTrac’s US Residential Property Vacancy and Zombie Foreclosure report shows that the national vacancy rate continues to drop—reaching 1.6 percent of all residential properties in the third quarter of 2016. At the metropolitan area level, the vacancy rate is highest in the Flint, Michigan, metro area and lowest in the San Jose, California, and Fort Collins, Colorado, metro areas. Vacant properties in foreclosure, or zombie foreclosures, have also been trending down nationally, while vacant properties owned by banks after the completion of a foreclosure were up. “Assuming that the foreclosing lenders are maintaining these properties and paying the property taxes, [vacant real-estate-owned properties] pose less of a threat to neighborhood quality than zombie foreclosures, but they still represent a latent inventory in an inventory-starved housing market,” says Daren Blomquist, senior vice president of ATTOM Data Solutions, which owns RealtyTrac. The states with the most zombie foreclosures were Florida, Illinois, New Jersey, New York, and Ohio.
Source: World Property Journal