Affordable Housing: Oxford named as least affordable city to buy a house in the UK

Londonderry and Stirling are the UK’s most affordable cities in terms of house prices with Oxford being the least, according to new research.

Overall, house prices in cities have outpaced earnings growth by 11%, causing home affordability to reach on average, its lowest level since 2007, when the ratio of house prices to earnings stood at 7.5.

The average house price within UK cities has risen from £180,548 in 2013 to its highest ever level of £248,233 in 2018, the research from Lloyds Bank also shows. In comparison, average city annual earnings over the same period have risen by just 11% to £34,366.

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Oxford has an average house price of £460,184, some 12.6 times average annual earnings in the city of £36,430, making it the UK’s least affordable city.

There are seven cities with average house prices above 10 times the average annual earnings. These are Chichester at 11.5, Winchester 11.3, Truro 11.1, and Greater London, Bath and Cambridge, all at 10.3.

However, the London average figure disguises considerable variations across the capital with central boroughs significantly less affordable than the Greater London average.

Stirling in Scotland and Londonderry and Northern Ireland are the most affordable cities, with an average house price to earnings ratio of 4.4. Stirling is in the top spot for the sixth consecutive year.

House price growth has been the highest in Winchester over the past decade, up 93% from £281,224 in 2008 to £541,891 in 2018, compared to the UK cities average of 35%. Chichester is second with a rise of 76% followed by Greater London up 69%, Cambridge up 66%, St Albans up 64% and Oxford up 59%.

Over the past five years, Chichester has recorded the highest house price growth with a rise of 62% from £277,654 in 2013 to £450,023 in 2018. Cambridge has the second highest increase in average house price at 61%, followed by Newcastle upon Tyne up 56%, Ely up 54% and Lichfield up 52%.

‘Buying a home in UK cities remains challenging, as average house prices are outpacing wage growth. However the market has seen the number of first time buyers at a high and home owners are still attracted to cities across the UK, in spite of rising costs,’ said Andrew Mason, mortgage products director at Lloyds Bank.

‘Over the past five years, more than half of northern cities have made the UK top 10 in house price growth, whereas over a longer period, southern cities dominate,’ he added.


Labor’s affordable housing policy criticised

Labor’s policy to pay developers for building affordable rental homes has been criticised for being “awful value”.

Two of Australia’s top think tanks have slammed the “building on the National Rental Affordability Scheme” policy released in December that would give owners or managers of new homes $8500 a year for 15 years to rent their properties out for 20 per cent below market rates.

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It aims to build about 250,000 new homes and will cost about $6.6 billion over a decade, but the Grattan Institute’s John Daley said it would be “pretty awful value if it is anything like the last one”.

The plan revamps a previous policy launched by the Rudd government in 2008 when only 31,000 dwellings were built and subsidies of $11,048 a year paid.

Mr Daley told The Australian the subsidy was higher than the typical rent reduction for tenants, and landlords kept the difference.

He said the flat rate per dwelling also created an incentive to build smaller homes in cheaper locations, suggesting many of those built were apartments and studios that were unsuitable for those the scheme was trying to help, such as single mothers.

In a column for The Australian, Housing Minister Paul Fletcher suggested the proposed subsidy would be about double what typical renters would save under the scheme.

“Where is the sense in spending a dollar of public money to generate 56c in rent relief for low-income tenants?” he wrote.

Centre for Independent Studies research director Simon Cowen agreed a revamped scheme would be a waste of money and pointed out Commonwealth Rent Assistance already provided direct cash to support renters.

Mr Cowen believes housing should be dealt with by state governments, and it was up to them to address supply issues in places like Melbourne and Sydney.

“The first version of this scheme didn’t generate nearly as many houses as hoped — that is because these schemes don’t ­address the real issues blocking supply: state government taxes and charges and local government planning laws,” he said.

However, Labor’s spokesman for housing, Senator Doug Cameron, said many were opposed to ending the subsidy including the Housing Industry Association, Urban Development Institute of Australia, and National Shelter.

“Nearly two-thirds of the dwellings Labor built under NRAS were two or more bedrooms,” Senator Cameron said.

Last year a report revealed Australia was facing a massive housing shortfall unless governments ramped up affordable home building.

The Australian Housing and Urban Research Institute (AHURI) warned the country would need an estimated 727,300 additional social housing dwellings in the next two decades — with the current shortfall sitting at 433,000 homes.

Report co-author Dr Laurence Troy, from UNSW Sydney, found the number of public housing units built by Australian governments had shrunk significantly from the 8000 to 14,000 new public housing units a year that were being built 40 years ago.

“Australian governments have been recently funding only around 3000 new social housing units per year,” he said. “We estimate that output of about 15,000 is needed just to stop the existing shortfall from getting even bigger. To fix the current problem as well, over a 20-year period, calls for a tenfold increase.”


Kenya: Housing cooperatives,key to affordable homes dream

The housing situation in Kenya is deplorable. Only 16 per cent of Kenyan households in urban areas own the houses they live in, while the majority at 84 per cent rent. About 61 per cent of the urban dwellers live in slums.

Such are the statistics that have necessitated the intervention of the national government, which plans to deliver 500,000 decent and affordable housing by 2022.This will be done through the Public Private Partnership model.Conventionally, Kenyans have owned housing through mortgage financing, building their houses incrementally as funds allow and through housing unions and co-operatives.

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Kenya’s cooperative movement is ranked seventh worldwide, and first in Africa. It contributes 90 per cent of the housing stock delivery in Kenya.With over 23,000 registered housing co-operatives and more than Sh700 billion in savings, and an asset base in excess of Sh800 billion by the end of 2017, housing cooperatives are in a good position to help the government achieve its Agenda Four on housing.

Housing cooperatives have taken up the mantle in providing affordable housing for low income groups. Those who earn between Sh15,000 and Sh49,000 per month constitute 71.82 per cent of the formally employed.While Agenda Four on affordable housing envisages that cooperatives should contribute significantly towards housing stock delivery by 2022, it also calls for an integrated approach within the cooperative sector.

I am happy to recognise the effort of the office of the commissioner in coordinating a common strategy that will see cooperatives demonstrate their viable model in development.

Housing cooperatives have big chunks of land and savings by their members. They can support the agenda through unlocking their expansive land through partnerships with the government and other investors, providing financing, buying the houses under the programme through mortgage model and Tenant Purchase Schemes, aggregating demands from their members for uptake of the affordable housing and lobbying at the local level for pro-affordable housing policies and initiatives.

Source: The writer, Francis Kamande, is the chairman of the National Cooperative Housing Union (Nachu).

How Affordable Housing Improves the American Economy

Housing is a big part of America’s story of innovation, productivity, and economic growth. For much of the industrial 20th century, housing helped to drive the economy by stimulating demand. Building more housing—especially in the suburbs—stoked the demand for more cars, washing machines, and other durable goods from America’s factories, creating good jobs for American workers and setting in motion a virtuous circle of economic growth.

But housing plays a very different role in today’s knowledge economy, where innovation and growth stimulate the clustering of knowledge, talent, and ideas. As a growing chorus of economists point out, the problem today is that we do not have enough housing—especially affordable housing—in the expensive and productive locations that drive the economy. The economic consequences often mean unskilled workers are unable to access good jobs in these cities, which costs the economy a huge amount in lost productivity.

A new study by the Hamilton Project at the Brookings Institution documents the dimensions of the housing-productivity nexus today and outlines a variety of possible solutions for all three levels of government, informed by innovative initiatives forged in places within and outside of the United States.

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The chart below details the scope of the problem. For much of the 20th century, economic outcomes were converging across the United States. But that began to change by the 1970s, with the decline in manufacturing and the onset of the knowledge economy, as the economies of U.S. regions began to diverge.

The big problem today is not just economic inequality, but growing geographic inequality. The study arrays some startling statistics on the scope of this geographic divide.

  • Nearly 60 percent of adults between the ages of 25 and 34 in Boston have graduated from college, compared to less than 20 percent in Lakeland, Florida.
  • The obesity rate is nearly 40 percent in West Virginia versus 22.6 percent in Colorado.
  • There’s a life expectancy gap of ten years between residents of Gadsden, Alabama (72.9 years of age) and those in San Jose, California (82.7 years of age).

A big part of the problem the study argues, stems from incredible differences in housing costs, which reflect underlying differences in productivity and lock many less-advantaged people out of these gains. In the most productive parts of the United States, like the San Francisco Bay Area and the New York-Boston-Washington corridor, housing prices have risen far faster than in the rest of the country. And the chart below shows housing costs have risen far faster than the costs of construction, meaning much of the surplus being generated, especially in expensive cities, has been channeled directly into the rising cost of land.

These implications are all too clear in the next chart that shows the fraction of homes in various metros that exceeds the standard affordability threshold of 30 percent of income. (The chart focuses on affordability as it pertains to working- and middle-class families; it does not include those below the poverty line). San Francisco, New York, Boston, Los Angeles, Seattle, and Miami all have a disproportionate share of cost-burdened households by this measure.

How should governments deal with the nexus of housing and productivity, one that limits economic opportunity for less-skilled workers and holds back economic growth across the board?

The study puts land-use restrictions, which limit the supply of housing in innovation centers, on the front burner. But it also argues that solving the problem requires developing new strategies to address housing affordability for blue-collar workers and disadvantaged groups.

The study looks for inspiration from innovative efforts in several cities across the world:

Tokyo has liberalized housing regulation significantly to develop more housing. It permitted much new housing at greater densities and heights, enabling it to alleviate a once-massive housing problem. It also has an extensive subway and transit system that allows residents to commute efficiently from significant distances.

Montreal has focused on the development of low- and mid-rise apartments, instead of tall skyscrapers or single-detached homes. It’s far more affordable than Toronto or Vancouver, cities that rank among the most expensive in the world. In fact, more than three-quarters of the city’s residences are apartments in duplexes, row houses, semi-detached houses, or other buildings with fewer than five stories, more than double the 35 percent figure for Canada as a whole. The housing was often designed to be produced inexpensively. By investing moderate amounts to build mid-level housing, rather than a few expensive skyscrapers, the city has solved the “missing middle” problem, creating family-sized housing at affordable costs.

Vienna has redefined public housing in ways that work for it. Nearly 60 percent of the city’s residents—including middle-class residents, not just those who are low-income—live in houses that are owned, built, or managed by the government. In addition, their rents are tied to both income and maintenance, which helps ensure that the properties are kept in good shape. While public housing is thoroughly debated in America, Vienna produces more housing per resident than other similarly sized European cities and has one of the lowest house price-to-income ratios in Europe.

Increasing housing supply is just one part of dealing with America’s housing crisis and the economic problems along with it. This is a political as well as an economic imperative, as the study points out. Pressure is mounting on political leaders in superstar cities to address housing affordability through initiatives like expanded rent control or inclusionary zoning, which mandate that developers construct some proportion of affordable housing units in return for greater densities. The study suggests the more efficacious route is to combine housing vouchers—which give less-advantaged residents income supplements to purchase more housing—with efforts to increase housing supply.

“Demand-side policies are strong complements to an easing of land-use restrictions,” the authors write. “Promoting demand-side subsidies alongside movements to allow market-rate construction is not just sound politics—it is sound economics. These affordability programs will provide better bang for the buck when housing supply is less restricted.”

Ultimately, the study makes the critically important point that there is no magic bullet solution to America’s housing-inflected economic woes. Policies to increase supply by developers and demand by less-advantaged residents need to be seen as complementary strategies to be implemented together.


Our Housing Policy Will Accommodate All Lagosians – APC Deputy Gov Candidate

Irrespective of status, the All Progressive Congress (APC) Deputy Governorship candidate, in Lagos state in the forth-coming general election, Dr. Hamzat Obafemi Kadri, has assured that their government would evolve a policy that will accommodate all categories of residents in the state, when APC is returned to steer the governance of the state.

Hamzat, who spoke on behalf of Babajide Sanwoolu Campaign Office to selected journalists in Lagos on Monday, said his team has what it takes to provide housing for Lagos residents without stress.

He said his government would not discriminate against anybody in the state, noting that everyone deserves a descent and functional homes.

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According to him, many are having issues with getting good homes of their choice due to wrong perspective and approach, adding that their government would work towards having in place sustainable housing programmes for all cadres of the people.

Citing a report, Hamzat said: “On the average, it takes 17 years for an African to build his house.  This is because we buy houses in this part of the continent like we buy yam or rice.  What needs to happen is to have working and affordable mortgages.  That is the way it’s being done all over the world.

He added: “Take for instance, if I buy a house for a long period of time with mortgage, I can refinance it over a period of time. If I buy a house in 1990 for instance, by 2000, the property has added value and I refinance it.  Through that deal, I’ll get some money and I cash out.

To get this done, the APC Deputy Governor candidate in Lagos said: “We must get such thing working in Lagos.  To do this, however, we need land reform, though our constitution albeit limits the roles of governors in this regard. Under the Land Use Act, the constitution says that the land is vested in the governor,” he noted.

Apart from the policy, the IT engineer said it was high time we changed our housing designs and pledged that their government would work towards ensuring this become the norm. “Going forward, we need to manage our land space through modern architectural designs.  When you go to London, you will see such flats, though they may appear small, but they are manageable.

“The idea of building a house with a long corridor is waste of space in Lagos having 0.4 per cent landmass?  The state does not have land.  We can’t build like Niger State that has 7.8 per cent landmass. So, we must go up and reduce sizes, while ensuring the mortgage system works effectively. 

“We demonstrated this with HOMS project. With HOMS project, we were producing 200 homes every month.  So, it is a terrain we are familiar with and we can do it again.  Those to benefit don’t have to be educated before they benefit or participate. You can be a plumber and whatever you are, once you have a record and having a work, that can empower you to pay your mortgage, then, you can benefit.”

Source: Independent

Affordable Housing: Kenya to construct 300 housing units in Kiambu County

Kenya is set to construct 300 housing units in Kiambu county through an American Investor, Karl Gibbons who has expressed interest in investing in Kenya’s real estate sector.

Mr. Karl Gibbons said that his firm, has partnered with Kenya to construct the housing units which will be two and three bedroom units in Ndenderu dubbed Fanisi Tigoni View.

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“We are excited that Third Eye Management and Associates has chosen us as a vehicle to improve the housing sector in Kenya. The first project ‘The Fanisi Tigoni View’ is a fantastic project, with the first phase being launched on Saturday with about 90 units on a one acre piece of land,” said  Mbugua, Sprinter’s Chief Executive.

The Fanisi Tigoni View will be a mixed use development that will sit on 8 acres prime land next to the western Bypass interchange. Additionally, the firm plans to build over 700 units this year targeting the middle income with their prices ranging between US $50,000 and US $70,000.

According to the World Bank, there is a shortage of 2 million low-cost houses in Kenya. 200,000 houses are needed each year in order to achieve the yearly demand for housing in Kenya but only 50,000 units are constructed annually. The Bank also states that 61% of urban households in Kenya leave in informal settlements.

Affordable rent is the most important issue for UK tenants

Affordability is the most important factor for tenants in the UK looking for a home to rent, according to a new survey.

The cost of renting a home was the top factor for over 40% of respondents to the research carried out by Intus Lettings.

Only 8% prioritised amenities, including restaurants and public transport links as a driving force behind their decision on a tenancy, it also found.

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An outdoor space is also important with 46% saying they would like a garden, terrace or balcony while 40% would be put off by a property without a parking space, and 24% said they would be deterred by dated interiors.

However, where would be tenants look to find a home varies widely by age group, the poll shows. Some 34% of those aged 18 to 24 would like live in a city centre apartment, whereas over 35s named a house in a smaller town as their ideal location.

‘Our figures seem to suggest that renters first and foremost seek practicality over certain features which have traditionally been seen as desirable, especially to younger tenants, such as nearby shops and restaurants or a vibrant nightlife,’ said Hope McKendrick, Lettings Manager at Intus Lettings.

‘With high rental costs across the UK, many young renters may be forced to prioritise a property which works around their budget and daily routine, as tenants flock to homes which provide ample parking or easy access to city centre jobs or studies,’ she explained.

‘We’re seeing a clear trend towards a generation of practical renters, those looking for a convenient, modern feeling home rather than exciting but potentially costly surroundings,’ she added.


Why Can’t Public Housing Provide Privacy Too?

The 2016 World Architecture Festival (WAF), held in mid-November in Berlin, was themed “Housing for Everyone,” but at no point in the three-day event was it clear exactly who this “everyone” consisted of. While in some cases the word seemed a euphemism for those unspecified masses in need of social housing, at other times “everyone” took on far narrower connotations, referring to those relatively few who can pay to commission an architect for specially designed homes. The very abstractness of the term hindered a critical examination of the way architects apply different design priorities to those implied categories.

Those who did focus on housing in a broad sense included South African archtect Jo Noero, who pointed out that private housing is easy to do well, because the client’s wishes are negotiated through a straightforward dialogue. But when it comes to housing for “everyone” else, where standardization is the norm, residents’ needs are generally assumed without asking. In many ways Noero’s criticism was reflected in the structure of WAF itself.

During a live competition process held on each of the festival days, architects speedily presented projects in several different categories and received critiques from panels of judges. (A winner was announced at the end of each day.) In the housing-focused categories, the presentations mainly included the glossy, blog-friendly, big-budget sort: a luxury condominium complex in Malaysia, a beachside retreat in Brazil. Consideration of less glamorous housing projects—the so-called socially engaged ones—was mainly reserved for the lecture component of the event programming.

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The assumption behind this split seems to be that all “public” housing work is de facto good work that shouldn’t be thrown into a speed critique. Indeed, it’s probably correct that public housing can’t be judged by the same criteria as the private kind—but that doesn’t mean it can’t be judged at all.

Disregarding, for the time being, that the lines separating publicly subsidized and privately developed housing have blurred, there’s a lot to be learned about the language used to describe each. Some buzzwords cross all boundaries—Sustainability! Sustainability!—but many are firmly entrenched in their separate camps. When presenting private housing for the wealthy, architects stressed “privacy” as the predominant factor, but when it came to housing for the not so wealthy, they emphasized “community.” In general, luxury homes are unambiguously praised for the isolation and security they provide, whereas housing for the everyperson tends to fall back on some abstract notion of idyllic communal life.

Why exactly should the goal of expensive, private housing be to isolate the inhabitant from public life, whereas the goal of public housing is to thrust residents into public view and promote their interaction as a moral good?

This terminology makes sense on the surface, as the very words “private” and “public” connote different types of ownership. But why exactly should the goal of expensive, private housing be to isolate the inhabitant from public life, whereas the goal of public housing is to thrust residents into public view and promote their interaction as a moral good? Or, more to the point, if communal interaction is good for everyone, then shouldn’t it apply equally as a priority for all kinds of housing?

There is a long-standing link between privilege and the right to privacy; you can do what you like with private property, including building a wall around it and guarding it with drones. At WAF, the intrinsic connection between wealth and seclusion could be observed everywhere—even within the scope of a single high-end project. When presenting his firm’s d’Leedon complex of seven residential towers in Singapore, Michele Pasca di Magliano of Zaha Hadid Archtects described how the design caters to buyers at different price points. Higher paying buyers, he explained, want fewer units on their floors and fewer elevator landings, so their apartments feel more “exclusive.” This is entirely distinct from the simple wish for a larger apartment—it’s specifically a wish for fewer (visible) neighbors.

It’s likely true that those residing in public housing lack extensive social safety nets, and so rely more heavily on informal support networks than the rich do. (Rather than expecting people construct their own social security, policy makers could just offer better public services—but that’s another discussion.) However, lack of privacy is a longstanding mechanism of state control. In most societies, the least advantaged are precisely those continually subject to the public gaze: the homeless, the stateless, the unemployed. If community is a feature to be built into public housing, it should be done with the knowledge that visibility is not always desirable. It should be a choice.

The most interesting projects presented at WAF used creative design not only to interrogate conventions of public/private space, but also to suggest new types of spatial ownership. For instance, one straightforward way to shake up ownership norms is to design buildings that offer a mix of subsidized and market-rate properties, while adding common areas and zones of peripheral visibility. As one example, Jeanne Gang presented her firm’s City Hyde Park,a mixed housing project in Chicago that incorporeates overlapping balconies to promote visibility across income lines.

Gang also presented a second, much more ambitious project that outlined a new housing strategy for the Chicago suburb of Cicero, which was hit hard by foreclosures after 2008. The plan proposed that blocks of land be placed under communal ownership, with residents purchasing single units on each of them. Community members could obtain mortgages more easily and have access to private homes and equity. At the same time, the terms of the plan would cement mutual responsibility for any shared space. Importantly, the project was developed after extensive consultation with local residents.

Other conference participants including Noero, his collaborator Rainer Hehl, and Delft University of Technology professor Dick van Gameren similarly stressed the value of long-term, site- and community-specific engagement. Even so, most other architects’ presentations seemed to fall back on those reliable keywords—“communal” this, “private” that. It’s harder to illustrate the process of interviewing residents, or causally link design moves to their input, than it is to show a playground in the center of a development and call it community space.

Berlin-based architect Ole Scheeren approached the question of communal space from another angle, asking the audience: “How can we make the realm of the private relevant to the realm of the public?” One solution he proposed was cracking open the typology of the private tower by inserting public space within it, as he demonstrated through DUO,a high-rise residential development in Singapore. In developing the project, his goal was to integrate two separate structures into surrounding urban areas, with large zones for foot traffic between them. In addition to typological solutions, such as angling the buildings to widen pedestrian paths, Scheeren suggested that the entire development remain open 24 hours a day, an unusual idea in many cities, but especially in Singapore.

Design choices like these won’t solve massive structural problems. Yet they are important because they don’t take an oppositional approach to designing for the private and the public. Nor do they discount the creative stimulant of community outreach. Housing in the broad sense—for “everyone”—deserves to be afforded the same professional attention and critique as beachside villas do. And perhaps, as with any luxury home, the critique should not only come from a panel of professional judges but from residents themselves.



California is the only state to block affordable housing in its constitution. Here’s how it happened

In 1950, Californians voted to put a provision in the state Constitution that makes it harder for poor people to find a place to live.

Article 34, which remains in effect, requires voter approval before public housing is built in a community. At the time it passed, the real estate industry argued taxpayers should have a right to vote on low-income housing projects because they were publicly funded infrastructure similar to schools or roads. The campaign also appealed to racist fears about integrating neighborhoods and featured heated rhetoric about the need to combat socialism.

The rule stymied low-income home construction in California for decades, including a decision to abandon public housing in Los Angeles’ Chavez Ravine neighborhood and build Dodger Stadium instead. Article 34 also weakened efforts to integrate suburban communities across the state and led to a landmark U.S. Supreme Court case that had the effect of allowing government policies nationwide that discriminate against poor people.

”We know the roots of where it came from,” Los Angeles Mayor Eric Garcetti said. “It’s a white supremacist chapter in the state’s history.”

Garcetti is behind a new effort to ask voters to repeal Article 34, mostly as a way to erase what many see as a stain on California’s Constitution. Other states have had — and repealed — laws that called for a public vote before the construction of low-income housing. But no other state constitution similarly requires voter approval for public housing, according to the California Constitution Center at UC Berkeley’s law school.

Today, as the state grapples with an unprecedented affordable housing shortage, Article 34 has limited effects on the construction of low-income developments. But it remains an obstacle: Los Angeles officials believe that without a public vote in the coming years, the city will no longer be able to finance such projects — even though it has the money to do so.

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State Sen. Ben Allen (D-Santa Monica) has introduced legislation to put the repeal before voters.If it goes on a 2020 statewide ballot, it would be the fourth time Californians would consider changing or doing away with Article 34. Three prior efforts, including the most recent in 1993, failed by wide margins with opponents arguing that residents should have the right to keep public housing out of their neighborhoods.

But Allen believes the electorate has changed since the last attempt. In the past few years, voters have supposed tax increases and bond measures to help support low-income and homeless housing.

Article 34, Allen said, “is an anachronistic barrier that stands in the way of that.”

Article 34 grew out of a fight in the northern coastal city of Eureka. Residents there collected signatures to overturn a decision to build public housing financed by a federal program inaugurated during the New Deal. But in 1950, the state Supreme Court ruled the acceptance of federal dollars wasn’t subject to a referendum and residents couldn’t block the development.

The California Real Estate Assn., the forerunner of today’s California Assn. of Realtors, came up with a ballot initiative later that year to combat the Eureka decision and require a public vote before public housing could be built.

Realtors argued that residents should be able to weigh in on such a project because it could create taxpayer debt.

But the campaign, which coincided with the start of the Korean War, was about more than giving voters a say. In the Realtors’ internal newsletter, Charles B. Shattuck, the organization’s legislative committee chairman, wrote that public housing threatened capitalism.

“If you value your property, if you hold liberty dear, if you believe in the dignity of the individual, if you love this land of the free and the home of the brave, if you desire to stop the enemy of socialism that is gnawing at the vitals of America from within, the ballot box is your weapon, the one and only means by which our great Republic will be preserved and improved,” Shattuck wrote in November 1950.

Newspaper ads paid for by the Realtors also blamed “minority pressure groups” for pushing public housing. At the time, the Realtors’ Code of Ethics included a provision barring agents from integrating neighborhoods on the basis of “race or nationality” if doing so would be “clearly detrimental to property values.”

The initiative passed by fewer than 50,000 votes.

In Los Angeles, residents supported Article 34 by an overwhelming margin. The city was planning to build 10,000 units of public housing, and the success of the statewide measure buoyed opponents who agitated for a referendum on the projects the city had already approved.

The resulting election in 1952 ended in a rejection of public housing, and plunged city politics into chaos.

A top official in the city’s public housing department was fired after an accusation that he was a communist and was later called to testify before state and federal Un-American Activities committees. The pro-public housing mayor lost his reelection bid. And the city canceled two planned developments, including one in which residents were already being displaced in the Mexican American community of Chavez Ravine on a site that eventually became Dodger Stadium.

The disputes chilled attempts to build public housing in Los Angeles, which did not hold another Article 34 referendum for more than two decades.

Los Angeles wasn’t the only city where Article 34 thwarted public housing. By 1969, voters across the state had turned down nearly half the public housing that had been proposed in Article 34 elections — 15,000 units — and many housing agencies didn’t hold elections, fearing that their plans would be rejected. A federal Department of Housing and Urban Development report at the time found that California had the nation’s largest population of poor people but ranked 22nd in the amount of housing available for them. The report blamed Article 34.

Those opposed to public housing were often open about their reasons. In 1968, San Jose City Councilwoman Virginia Shaffer led a campaign against a series of publicly funded duplexes and small apartments in her city, telling a reporter that some poor people “drag the whole neighborhood down.”

“People oppose public housing because too often it means there will be piles of garbage, trash, knee-high grass and undisciplined children in a neighborhood where other people are trying to meet their payments,” Shaffer said.

The San Jose vote failed, prompting a legal challenge to Article 34. The lawsuit argued that it violated the U.S. Constitution’s Equal Protection Clause by denying poor people access to housing.

The case made its way to the U.S. Supreme Court, where in 1971 justices affirmed Article 34’s constitutionality. In the majority opinion, Justice Hugo Black agreed that Article 34 put low-income residents at a disadvantage, but wrote it did not violate the Constitution because the provision didn’t single out a racial group.

“Provisions for referendums demonstrate devotion to democracy, not to bias, discrimination or prejudice,” Black wrote.

The Supreme Court decision was consequential, said Matthew Lassiter, a history professor at the University of Michigan and an expert in the growth of the U.S. suburbs. The ruling had the effect of affirming state and local policies that were openly biased against poor people, he said. Soon afterward, President Richard Nixon released a statement that embraced the decision’s logic, saying that the federal government would not impose economic integration on cities and counties.

“The Supreme Court case is one of the most important defeats in civil rights history in the last century, and is under-appreciated in how much it contributed to the stoppage of efforts to integrate communities across the country,” Lassiter said.

Lassiter also was critical of the ruling for overlooking Article 34’s racial implications. Racial discrimination in housing was legal until 1968, and in decades prior  the federal government had guaranteed bank loans to developers of white-only subdivisions, promoted the use of racially restrictive covenants on deeds to prevent people of color from buying homes and subsidized white residents’ mortgages but not others. The policies gave whites access to wealth through homeownership that others didn’t have.

Blocking low-income housing, Lassiter said, had the consequence of keeping most non-whites from living in those areas as well.

“To say it was not about race is to say history doesn’t matter and there was this magic historical moment where all vestiges of a racialized housing market went away and everything started anew like the Book of Genesis,” Lassiter said.

The Supreme Court decision returned the focus to California.

On three occasions, state lawmakers have asked voters to rescind or weaken Article 34. In 1974, a repeal failed by 24 percentage points. Six years later, legislators put forward a proposition so that residents could appeal a decision to build public housing instead of holding an automatic vote. That measure lost by an even greater margin. Then, in 1993, lawmakers tried again with a proposition that would have kept Article 34 on the books, but exempted almost all projects from its rules.

This time, the measure was supported by the California Assn. of Realtors — the group behind the original push for Article 34. It didn’t matter. Opponents, including a state senator from northern Los Angeles and an Orange County assemblyman, contended in the official voter guide that Article 34 was a success because it prevented public housing from being built.

“Why should we trust politicians and special interests to protect our local neighborhoods and spend our tax dollars wisely?” they wrote.

Nearly 60% voted no.

Article 34 is much less of a barrier to low-income housing construction than it used to be. Over the years, funding sources for such projects have changed. When private developers set aside a portion of homes in a project for low-income residents or housing is funded by federal or state tax credits,a vote is not required.

Courts have also decided that local governments can hold elections to authorize an overall number of public housing units to be built in future years rather than go to voters for each individual project. And residents became friendlier to Article 34 elections, with around 80% of referenda approved by the early 1990s, according to a report by the state Department of Housing and Community Development.

Still, the provision continues to be an obstacle for some low-income homebuilding. Affordable housing developers structure deals to avoid triggering a vote — legal and consulting costs can be in the tens of thousands of dollars — or must ensure that a city has enough units approved from a prior Article 34 election. But when a local government hits its cap, it must again seek approval from voters.

That’s happening in Los Angeles. A 2008 ballot measure approved by voters allowed up to 3,500 public housing units per council district in the city. Some neighborhoods are now close to their limit. City officials believe they’ll have to hold another vote within the next couple years to increase the cap, prompting Garcetti to instead pitch a repeal of Article 34 to the Legislature.

Garcetti also said he takes issue with the argument that low-income housing should be subject to a public vote because it involves spending government money. Taxpayer subsidies for homeowners, through the mortgage interest deduction and other means, long have dwarfed the public funding available for low-income housing development.

“We have done a much better job helping middle-class, upper-middle-class and wealthy Californians with housing subsidies than we have for working-class residents,” Garcetti said.

But a repeal of Article 34 is hardly a sure thing, said former State Treasurer Phil Angelides, who worked on one of the failed efforts to weaken it. Angelides called the provision “a blot on the [state] Constitution,” but said, on its face, a requirement to hold a public vote doesn’t seem like it might have negative effects.

“While it’s clearly discriminatory, it has the aura of local control, which is something people like in California,” Angelides said. “It’s going to take a campaign of informing voters what it means.”



Millions of low-income renters at risk if shutdown goes into March

If the partial government shutdown continues into March, millions of low-income renters will find their housing at risk. And if the shutdown extends past February, each month, $1.5 billion in rental assistance payments will not be paid to landlords who rent to persons using Section 8 Housing Choice Vouchers (HCV). Tenants will also lose out by not receiving their utility allowances. Many housing authorities will also have to find ways to keep their staff in place and programs running as program administrative fees will go unpaid.

The Department of Housing and Urban Development (HUD) is one of the federal agencies closed during the partial government shutdown that began on December 22, 2018. HUD has said there are enough Section 8 Housing Choice Voucher (HCV) funds to keep the program running through the end of February. But if the government does not re-open by then, HUD will not be able to fund the March 1st HCV rental assistance payments from Public Housing Agencies (PHAs) to landlords.

Some PHAs have reserves that they can use to keep the program running for a short time, but many do not have large reserves. This is especially true for small PHAs. PHAs with limited operating reserves may have to suspend program operations if the funding stops in March.

People on the HCV program also receive a monthly utility allowance to help them pay for heat and electricity. If an extended shutdown goes into March, HUD will not have the funds to pay tenant utility allowances. Not only will landlords have trouble paying their bills and maintaining their properties, the poorest tenants will have to make hard choices between keeping the heat on or cutting back on other needed things like food.

Although landlords may not get their payments from HUD in March, they cannot evict HCV tenants and they cannot force tenants to pay HUD’s portion of the rent. HUD requires these conditions in the leases used for both the Section 8 HCV program and properties receiving Section 8 Project-Based Rental Assistance (PBRA). Landlords could, however, defer needed maintenance to save money. This could affect the quality and safety of apartments rented by Section 8 voucher holders.

And even though tenants are protected from eviction by HUD policy, an even bigger issue may be arising. Some PHA representatives have expressed concern to Affordable Housing Online that repeated missed payments between a PHA and the landlord could result in a breach of contract. This would void the contract and any tenant protections with it, which may ultimately lead to tenant eviction. Our team is looking more into these allegations.

Even though landlords cannot currently evict Section 8 tenants, they are not required to renew leases. If the government’s portion of rent is not getting paid, landlords may see participating in Section 8 as too risky. People move and sign leases all year long, so any given month, roughly 8% of Section 8 leases come up for renewal. If the shutdown drags on for months, more Section 8 voucher holders will be at risk of having to find new homes.

Some crooked landlords or property managers may still threaten eviction or try and charge tenants more, but it would violate the terms of the lease. If this happens, renters should contact the PHA that administers their voucher. Tenants can also get assistance from their local Legal Aid office. HUD has a skeleton staff. This means that very few people are available to help the public in HUD’s national or regional field offices.

If Section 8 HCV funding runs out in March, landlords and tenants are not the only ones who will be feeling the pinch. PHAs are local organizations and its staff does not work for HUD. They have continued working with pay through the shutdown. But the staff who run local Section 8 HCV programs are paid by Section 8 administrative fees. Local PHAs around the country are currently planning how they will keep their Section 8 staff on after funding runs out. If they do not have reserves or other funding sources to pay staff, basic program functions may need to be suspended. Reviewing applications, issuing new vouchers and doing unit inspections could grind to a halt.

PHA staff may have to be furloughed, joining the ranks of many federal workers trying to pay bills while the shutdown grinds on. Some PHAs have already stopped taking new applications and issuing new vouchers because of the uncertainty caused by the shutdown. It would put the renters and landlords in a bad position to move someone into a new house now and have payments stop in little more than a month’s time.

Aimee Jacobsen, Director of the Section 8 HCV program for the Noblesville Housing Authority (NHA), said to Affordable Housing Online the shutdown has already had an impact on their program. NHA is a small PHA serving Hamilton County, Indiana that is ready to issue vouchers to some people on their waitlist, but staff is holding off because of uncertainty over how long the shutdown will last. She’s heard concerns from tenants worried if they will lose their housing, but not much yet from landlords. NHA has a small staff administering 235 vouchers, and depends on Section 8 administrative fees to run the program.

Even PHAs that have enough reserve funds to carry the HCV program after February will have trouble accessing those funds. If a PHA wants to use its reserves, it needs to get approval from HUD. They need to send HUD a request, give a detailed explanation of need and provide proof to back it up. This all must be reviewed by HUD regional office and national office staff. Since 95% of HUD’s staff are furloughed, it will take a long time for reserve requests to get approved.

Some PHAs have posted notices on their websites describing how their programs will be affected if the shutdown continues past February. Others have sent letters to landlords and tenants. Staff with Indiana’s statewide housing authority told Affordable Housing Online they were waiting until after February 2 before sending out letters. Some PHAs are waiting until February to send out letters in case the government reopens soon. This also gives PHAs more time to identify funding resources and develop staffing plans.

A prolonged shutdown of HUD will hurt millions of low-income renters, landlords and dedicated housing authority staff. It will force low-income renters to choose between keeping their apartments warm and putting food on the table or buying medicine. PHA staff around the country may have to be furloughed, with no guarantee of back pay. The most attractive thing about the program for landlords has been the security of government payments. Faced with mounting bills, deferred maintenance and no payments from HUD, many landlords may decide not to accept Section 8 vouchers when leases come up for renewal.

The Republican leadership in the Senate can end the shutdown by passing the HUD and USDA spending bills already approved by the House. These are the same housing program levels approved by the Republican Senate in the last Congress.

If you are a renter, landlord or administrator affected by the government shutdown in any way, we urge you to contact your local representatives about the need to end this shutdown.

Source: Chris Holden

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