As Google planned its downtown San Jose mega-campus, the tech giant promised it wouldn’t take tax breaks or subsidies from the city. Google’s real estate team held up their end of that bargain, according to a new letter obtained by San José Spotlight.
Google’s Delmas Park project, which could potentially include 1.04 million square feet of office space and 325 multi-family housing units, was previously in the pipeline to receive a $4.8 million exemption from paying affordable housing fees.
The city typically requires developers to pay $17.83 per rentable square foot to help finance its own affordable housing projects. But the Delmas Park Project, located at 402 W. Santa Clara St., was acquired from developer Trammell Crow Company who had been approved for an exemption of those fees.
On Tuesday, however, Google’s Real Estate Development Director Alexa Arena sent a letter to the city’s Housing Department requesting that the project be pulled out of the exemption pipeline.
“Based on our analysis and our shared goals to contribute to the city’s affordable housing priorities, we intend to move forward with a program that complies with the Inclusionary Housing Ordinance,” Arena wrote. “We are committed to fulfilling our inclusionary requirement through delivering affordable housing onsite.”
The letter came a week before the San Jose City Council is scheduled to review the slew of projects exempt from affordable housing impact fees – an initiative created in 2014 to reduce negative financial impacts on certain housing developments.
According to a memo from Housing Director Jacky Morales-Ferrand, a project must meet a series of criteria to be eligible for fee exemptions:
The development has received approval for certain entitlements that have not expired.
The developer submitted a pipeline exemption application with evidence of permits to the housing department by June 30, 2016.
Morales-Ferrand told San José Spotlight that nine new projects – including the Google development – have withdrawn from the fee exemption. That means they’ll pay their fair share of affordable housing fees.
The list of additional projects was not available by Friday afternoon.
Jeffrey Buchanan, a spokesperson for Silicon Valley Rising, said he’s glad that Google decided to ultimately pay the $4.8 million in affordable housing fees, but added that it was concerning that the tech-giant even considered the exemption.
“We want to see if Google is really committed to affordable housing,” he said. “We need to see more than talk, we need to see action. We’re almost two years since the project was first announced and Google hasn’t put anything forward.”
If you’re looking for good news in the housing market, there’s this: Prices aren’t likely to crash the way they did in the historic bust of 2006-09. During the last boom, buyers, lenders, and builders were swept up in speculation, and prices soared even as a flood of new homes came onto the market. That unsustainable combination doesn’t exist today. “A crash is just not something that I see in the cards, even at the local level,” says Greg McBride, chief financial analyst for Bankrate.com.
Rather than heading for another bust, we’re still feeling the effects of the last one. Aggressive homebuilders were wiped out, and the survivors are cautious about working on spec. Smaller builders that rely on borrowing can’t supercharge construction, even if they want to, because their bankers are afraid of making loans. Even after a gradual rebound from its nadir in early 2009, the rate of starts on erecting single-family residences remains below the level of the early 1960s, when the U.S. population was less than 60 percent of what it is today.
Instead of an oversupply of homes, there aren’t enough being built. That’s propping up prices at levels that exclude many Americans from ownership. “We are underhoused,” says Aaron Terrazas, a senior economist for Zillow Group Inc.
The shortage is being aggravated by low unemployment, which is making it hard to hire workers. Not-in-my-backyard zoning rules are exacerbating the issue of an already small pool of construction-ready lots, and developers claim regulation is driving up costs. In March the National Association of Home Builders told Congress that edicts involving lead paint, endangered species, and worker safety go too far.
A tight supply has caused housing prices to climb steadily. Owning a home is simply out of reach in some cities. In the Los Angeles and San Francisco areas, the number of houses sold in December was the lowest for the final month of the year since 2007. In Manhattan the median price of a condo has topped out at about $1 million. People who want to buy a place are forced to keep renting, live with their parents, or move to an area with more stock for sale at lower prices. Pending home sales were down 9.8 percent in December, pushing them to their lowest level since December 2013.
Bubbles, which generally involve overbuilding, are more of a risk in other countries. Last year, Hong Kong was No. 1 in UBS Group AG’s Global Real Estate Bubble Index, followed by Munich, Toronto, Vancouver, Amsterdam, London, Stockholm, and Paris. San Francisco was the sole U.S. city to make the top 10. Below it were Los Angeles, New York, Boston, and Chicago—the only city on the global list rated undervalued (and that was before the polar vortex). The index takes into account price-to-income and price-to-rent ratios, among other factors, to determine how frothy markets are.
But even outside the U.S., there hasn’t been a lot of speculative building, says Jonathan Woloshin, head of Americas real estate investment strategy at UBS Global Wealth Management. “Nobody asked the question back during the bubble, ‘What would happen if prices went down?’ ” he says. “Better questions are being asked today.”
Tighter regulation has ended dangerous practices, such as no-documentation loans, which got people into houses they couldn’t afford. Down payment requirements are mostly higher. These changes have made it harder for people to buy a house, which isn’t necessarily a bad thing. When Fannie Mae, the government-controlled mortgage-buying giant, surveyed housing lenders recently, only 1 percent blamed tight standards for credit and underwriting for the weakness in sales. Forty-eight percent cited an “insufficient supply.”
The government is still cleaning up the mess from bad loans made before the bust. The U.S. Department of Justice has accused many companies, including Quicken Loans Inc. and Freedom Mortgage Corp., of improperly underwriting Federal Housing Administration loans and then filing claims for government insurance after borrowers default. (Freedom Mortgage settled for $113 million in 2016. Quicken, calling the complaint a “shakedown,” is fighting it in court.)
Rising mortgage rates also depressed the market in 2018. While strong economic growth gives more people the wherewithal to buy, it leads the Federal Reserve to raise interest rates, which makes mortgages pricier. Tendayi Kapfidze, chief economist for LendingTree Inc., says higher rates also shrink the inventory of homes for sale: People are less willing to move if their next purchase will have a costlier mortgage. On Jan. 30 the Federal Open Market Committee signaled it will be patient about raising rates further. In 2019, that will just have to count as optimism.
With as many as 2,155 apartment units either proposed or under construction in Santa Fe, observers have different views on what role these large projects will play in Santa Fe’s housing crisis.
Or is it crises, plural?
Santa Fe faces ultra-tight housing availability and high rental rates — a double-whammy that plagues the city on a variety of social and economic levels, experts say. The arrival of new apartments, lots of them, will shake up that paradigm, though exactly how no one can say for certain.
“Bringing in these market-rate apartments will free up more affordable units,” said Alexandra Ladd, the city of Santa Fe’s housing special projects manager. “Existing apartments will have to bring rents down a little bit. Higher-income renters [in existing apartments] will move to nicer apartments and this frees up units not available now to lower-income renters.”
Only three large-scale, market-rate apartment projects have emerged in Santa Fe since 2004, the year the city imposed an affordable housing ordinance requiring 15% of units to be affordable, later softened to allow developers to pay an in-lieu of fee instead supplying affordable units.
But big apartment projects are lining up for construction starts later in 2019 and 2020 in Santa Fe — one promising 355 units, a pair at 240 units and another pair at 180.
The largest apartment project now under construction is Broadstone Rodeo, 1475 Rodeo Road, with 188 units planned for a March completion.
That’s good news for some, and others hope it will have a ripple effect for those already struggling to afford their current dwellings.
“My hope is some of the [existing] apartments with fewer amenities will be able to lower rents,” said Carolyn Luna-Anderson, former executive director at the Life Link, a behavioral health program that provides supportive housing. “When we have had occupancy rates less than 97%, we had landlords willing to reduce rents by $10 or $25.”
Luna-Anderson noted an “absolute real shortage of rental housing.”
“The biggest thing is any type of rental housing is important anywhere for market-rate, senior housing; that can help the community,” Luna-Anderson said. “We need all types right now. We need a whole array of different types of housing.”
Still, the mathematics of several hundred or even a thousand new apartments potentially lowering rent costs at some existing apartments doesn’t necessarily compute for Ed Romero, executive director of the Santa Fe Civic Housing Authority.
“We will continue to struggle to find enough affordable units needed in this town,” Romero said. “It’s hard to lower rents. I think we still need to address building more affordable apartments.”
Santa Fe issued building permits for an average of 60 apartment units a year between 2010 and 2015 after permitting about 150 units a year during the 2000s, according to a February 2018 housing market profile by the U.S. Department of Housing and Urban Development.
The math adds up to a widely acknowledged shortage of about 6,000 apartment units in Santa Fe, said Todd Clarke, broker at New Mexico Apartment Advisors.
Madera Apartments is poised to be not only the largest complex in Santa Fe but also only the third multifamily community with more than 300 units outside Albuquerque, which has two dozen 300-plus unit complexes.
Madera will have 20 two-story buildings in Santa Fe Pueblo style near the Santa Fe River Trail, a paved pathway for bikes and pedestrians. Project developer Carlos Garcia hopes to start construction in spring 2020 and have the first units available by fall 2020.
“It’s all about the timing,” said Garcia, who is managing partner at NAI Maestas & Ward’s Santa Fe commercial real estate office.
Garcia did not have rental rates set, but indicated the units — a mix of sizes — will not be too costly.
“It’s going to be market rate,” he said. “We want to have it affordable for people to live here.”
Garcia specifically chose a location at the edge of town, north of the Santa Fe River, for Santa Fe’s largest complex.
“There is great access for 599,” Garcia said. “It’s a natural path to access downtown and other parts of town so we don’t congest other streets in Santa Fe.”
Garcia said he believes Santa Fe is ripe for multiple large-scale apartment projects.
“There is a need to build apartments,” Garcia said. “Our local market is still behind on supply for the demand we have.”
Just a block or so to the west, South Meadows Apartments is lining up for a fall construction start with move-ins starting in the summer of 2020 at the 240-unit complex with one-, two- and three-bedroom units in 10 three-story buildings. There will also be a community building with fitness room and resort-style pool, said Peter Kerwick, vice president of Storm River Development, the project developer.
Nationally, analysts are expecting a slowdown in apartment construction this year, but Santa Fe is ramping up.
“The coming multifamily projects, including South Meadows Apartments, will be very helpful to the community by providing much needed new housing,” Kerwick said.
Also at 240 units, Turquesa Apartments will be in the heart of Santa Fe’s national retail district, directly behind Santa Fe Place mall. The project is expected to break ground this summer with a 2020 completion, said Jennifer Jenkins, a principal in the Santa Fe project management firm JenkinsGavin in Santa Fe.
JenkinsGavin is working on four Santa Fe apartment projects, including the 52-unit Rancho Vizcaya III apartments near Sawmill Road and St. Francis Drive.
“Everything I’m working on is moving forward,” Jenkins said. “Everything should be under construction this year.”
“Believe it or not, the Planning Commission said we did not demonstrate that there was a need for this much housing,” said Eric Faust, who with his brother Kurt Faust, both at Tierra Concepts, are developing Acequia Lofts. “The City Council denied it because the neighbors came out against it.”
“It’s market rate but affordable for working people,” Kurt Faust said. “We’re in the final stages of putting together our final budget. We lost our perfect window four years ago. We’re struggling to figure out how to make it all work.”
Three years into a landmark legal settlement targeting housing policies, Baltimore County says more than half of the 1,000 affordable homes it promised are built or in the works.
But challenges remain as the county navigates the multiyear settlement under the administration of a new county executive. The county must sustain its pace in helping to finance affordable housing projects under the deal with the U.S. Department of Housing and Urban Development. County Executive Johnny Olszewski Jr. needs to introduce controversial legislation this year prohibiting landlords from refusing to accept housing vouchers commonly called Section 8. And affordable-housing projects are often unpopular, drawing opposition from neighbors like one such proposal in Owings Mills.
Olszewski, a Democrat who took office in December, said his administration is working to fulfill the goals of the settlement agreed to by the late County Executive Kevin Kamenetz.
“We have both a legal and a moral obligation to provide affordable housing in Baltimore County,” he said in a recent interview with The Baltimore Sun.
The 2016 settlement resolved complaints filed by the county NAACP, three residents and Baltimore Neighborhoods Inc., a nonprofit that abruptly closed last year. They alleged that county housing policies perpetuate segregation, discriminating against African-Americans, families with children, and residents with disabilities. The groups said the county’s zoning policies restricted the development of affordable housing, and that the county spent most of its housing money on programs such as senior-citizen rentals — which mostly benefited white residents — and demolished thousands of subsidized units for families.
The settlement requires Baltimore County to encourage private developers to build or rehabilitate 1,000 affordable rental units by 2027 in more prosperous neighborhoods. Introduction of the voucher legislation is also among the requirements.
“I think that the formula is there,” said Tony Fugett, president of the NAACP’s Baltimore County branch. “It’s just a matter of playing catch-up in the county and trying to make it work after years and years of segregation.”
But some are questioning where the government is encouraging the development of affordable housing. The county settlement specified that the new homes should be developed in 132 specific census tracts throughout the county — areas with low poverty, good schools and access to jobs.
“The idea was to have these units dispersed throughout Baltimore County,” said County Councilman Julian Jones, a Woodstock Democrat.
Constituents in Jones’ district recently raised objections to a 53-unit project called the Enclave at Lyons Mill, proposed by Conifer Realty and Episcopal Housing Corp. on a property at 9307 Lyons Mill Road. Two other affordable housing communities are nearby: The Preserve at Red Run and Red Run Overlook, which is under construction.
The Enclave project has not received financial support from the county, partly because of its location. It won’t count toward the settlement goals, but the state awarded it $1.5 million in tax credits last year.
Neighbors said their predominantly black community already has more affordable housing projects than other parts of the county.
“I’m not against affordable housing,” said Dwayne Jackson, who grew up in public housing in Baltimore. “I just feel that it needs to be equally distributed throughout the county.”
Lavone Grant of the Lyonswood Homeowners Association, which represents residents of a single-family development next to the proposed site, said traffic is already “horrendous.” The area is home to numerous apartments and town homes.
“It’s difficult getting out of our development and it’s difficult getting in,” said Grant, adding that she didn’t think an affordable housing project was “appropriate” to put next to a single-family development. “To put another apartment complex right there — it makes no sense.”
Critics also point to overcrowding at the nearby Lyons Mill Elementary, which is 112 students over capacity, according to school system data.
Members of the homeowners association recently wrote to local and state officials to oppose the project, citing concerns over its impact on the environment, traffic, schools, crime and property values. The letter says Owings Mills “already supports more than its fair share of affordable housing” while other parts of the county have none.
“Owings Mills has met its quota,” they wrote.
Neither Episcopal Housing Corporation nor Conifer Realty returned multiple messages seeking comment.
Olszewski said he is sympathetic to the neighborhood’s concerns.
“I understand some of the angst because part of the agreement is seeking to have affordable housing actually be more equitably distributed across the county,” Olszewski said. “That project sort of is counter to that underlying value.”
That’s why the county turned down financing for the project, and it won’t count toward the benchmarks the county has to meet.
State officials said the project helps meet the goals of a separate fair housing settlement — a 2017 pledge by the state to finance 1,500 affordable units around the Baltimore region. That case dealt with allegations that Maryland discriminated in the way it awarded low-income housing tax credits, which are the federal government’s primary tool for supporting the construction of affordable rental units.
“We’re trying to ensure enough affordable housing in the Baltimore metro area,” said Owen McEvoy, a spokesman for the state housing agency. “We believe this project helps fulfill that goal. The Department of Housing and Community Development has to look at the state as a whole.”
In Baltimore County, some of the completed projects have largely escaped controversy, officials said.
“We’ve managed to do these things and get them done successfully,” without much opposition, said County Attorney Mike Field.
So far, the county has lent developers more than $14 million of the $30 million pledged to help them build affordable units under the agreement.
County planning officials say 325 units are built or under construction, with 195 more in planning stages. That adds up to 520, more than half of the 1,000 units required by the settlement.
“The goal is to integrate into the community so that it doesn’t become noticeable,” said Jeff Mayhew, acting director of the county planning office.
Completed projects include Dunfield Townhomes in Nottingham and the Towns at Woodfield in Windsor Mill, according to the planning office. The figure also includes 42 “scattered site” homes in communities including Parkville, Rosedale and Reisterstown.
New multiunit projects are proposed for the Towson and Lutherville areas, according to the councilmen who represent those areas.
In Towson, Homes for America wants to build 51 units on Joppa Road near Fairmount Avenue, said Councilman David Marks. And in Lutherville, Osprey Property Co. has proposed a 26-unit development on Long Vista Court, off East Padonia Road, according to Councilman Wade Kach’s office.
Federal housing officials told The Sun that since the county agreed to the settlement, about 190 people have participated in a “mobility counseling program” designed to help voucher holders move to more prosperous neighborhoods, in order to avoid clustering them into segregated and low-income areas. The county is required to help relocate 2,000 people over a decade.
Matt Hill, an attorney with the Public Justice Center, said Baltimore County has “made a lot of progress” but faces challenges in the years ahead.
“We remain concerned about the county’s ability to sustain progress in the future,” said Hill, whose organization has been tracking implementation of the agreement.
He pointed to the county’s history, detailed in the federal complaint. In the 1940s, county policies isolated Turner Station, a black enclave in Dundalk, from white neighborhoods. In the 1960s, the county refused to create a public housing authority or build public housing. And in the 1990s, some politicians and residents opposed a federal program designed to help Baltimore public housing residents move to the suburbs — tapping into “long standing racial tensions and opposition to HUD-subsidized housing in the County,” according to the complaint.
“It’s important to recognize that the county really is playing catch-up,” Hill said. “The county still has a long way to go to remedy that history.”
Nika Edwards, a HUD spokeswoman, said the federal agency is providing technical assistance to county officials and is “confident the county will continue to make progress.”
This year, the county will have to take up so-called “source of income legislation” under the federal agreement. This measure would forbid landlords from turning away tenants solely because they use a housing voucher. County voucher holders are concentrated on the east and west sides.
When Kamenetz introduced the bill known as the Baltimore County HOME Act in 2016, the County Council rejected it by a vote of 6-1. Jones was the lone supporter.
This month, Baltimore acting Mayor Bernard C. “Jack” Young signed similar legislation for the city. Under an amendment that was criticized by housing advocates, the final version requires landlords to rent only 20 percent of their units to people with vouchers.
Gregory Friedman, community engagement officer with Citizens Planning & Housing Association Inc., said advocates are hopeful that Olszewski will be able to get council members on board with county legislation. Olszewski was the only candidate in last year’s county executive race to express support for the bill.
“We’re hoping that he will engage with the council and that this may lead to its passage,” Friedman said.
Adam Skolnik, executive director of the Maryland Multi-Housing Association, said his group would support county legislation if it included a provision similar to the city’s, but required landlords to only rent 5% of units to voucher-holders.
T.J. Smith, a spokesman for the county executive, wouldn’t say whether Olszewski would support caps similar to the city’s law.
“The county executive is committed to an inclusive process in working toward fulfilling our obligations on affordable housing,” Smith said in a statement to The Sun. “It would premature to say anything definitive about how the measure will be structured.”
Olszewski said he wants to work with all sides on the issue to find a version of the bill that can pass “without compromising the principles and the values” of the federal settlement.
“I want this to be collaborative,” Olszewski said. “I want to work with the industry to find a way to stop discrimination in Baltimore County … You can’t stop it unless you actually can find something that’s passable.”
With a struggling mortgage finance system, former civil servant and CEO, NISH Affordable Housing Limited, Yemi Adelakun has stated that Nigeria should begin to consider other sources of financing affordable housing in the country.
While speaking with Housing News, he said that since the existence of mortgage banking in Nigeria, it has only been able to initiate and finalise about 100, 000 mortgages. This he said is a far cry for a country of over 180 million people with a housing deficit of about 17 million.
‘’Mortgage finance is good, but it is not the only way,’’ he said.
According to him, other countries have used social capital to finance affordable housing through cooperative systems. ‘’In Zimbabwe and Kenya, they have done very well using social capital to support of affordable housing,’’ he said.
He also mentioned that another way of funding affordable housing is for the federal government to come out strongly with intervention funds like it is done in other countries.
‘’They have done it before in this country, especially in Abuja when federal government was selling houses. You can go to any bank at that time and obtain loan for 7%.’’
Another measure according to him is to also empower commercial banks to give preferential rates to off-takers to fund housing just like the farmers’ incentive.
‘’Any rate beyond 10% is not favourable for housing. We need a realistic method of financing affordable housing. And that’s why NISH Housing has been engaging with experts in this area. We have been holding Nigerian housing finance conference for two years now,’’ he said.
Equity financing, he said, is also one of the options, because the contractors themselves can finance.
‘’Presently most of our developers either depend on contracts to build or depend on off-takers’ advance payment to build the houses. They should consolidate their efforts and fashion a way to fund houses based on guarantees. That’s another way – bankable off-takers guarantee. Once you guarantee that, any developer should be able to go to site, build the houses with the hope and knowledge that as soon as he finishes the job, there is an exit strategy. The off-takers already have the fund waiting for him to purchase the house.
‘’So, for me, mortgage is very good, but it is not the only way. In fact if you look at it, only about 30% of off-takers can qualify for mortgages. So what happens to the rest? What happens to those who are in the informal sector who do not have regular income? For you to qualify for mortgage, there are certain regulations like collateral, evidence of income.
‘’We must find a solution to this housing finance problem. We are proposing that it must be a demand driven housing policy in Nigeria. We no longer want situations where developers go to site, build what they want to build in whatever location, and at the end of the day nobody wants to buy them; and even if they want to, they cannot afford them. So let’s figure out what people like and can pay for. So that at the time of constructing the houses you already know that you have buyers for those houses. I think this is the way, and it is possible through collaboration,’’ he advised
NAIROBI– Kenya is considering putting in place a series of legal and regulatory reforms that will boost the supply of affordable houses in the country, officials said on Wednesday.
Patrick Bucha, housing secretary at the Ministry of Transport, Infrastructure, Housing and Urban Development, told journalists in Nairobi that there are a lot of existing laws that impede the implementation of affording housing schemes.
“One of the laws earmarked for reforms include the Building Code which has stringent rules that don’t allow for use of alternative building materials that have been adopted in other countries,” said Bucha during the opening ceremony of a training program for property developers and contractors that was organized by Pan-African housing financier Shelter Afrique.
Bucha said that the Building Code has already being developed and will soon be presented to Cabinet for approval.
He added that the Sectional Properties Act will also be reviewed to ensure that apartment owners in high rise complexes can acquire appropriate ownership documents.
The official revealed that zoning laws that restricted development of affordable houses in certain areas will also be reformed so that the government can achieve its goal of developing at least 500,000 affordable houses by the end of 2022.
In spite of contrary interests, the Federal Government, under President Muhammadu Buhari, reduced import duties on more than 89 items in various sectors of the nation’s economy.
The reduction according to the government was to promote development in critical sectors of the economy including housing, and is part of its Fiscal Policy Measures.
At the time of announcement, the directive was made up of the Supplementary Protection Measures (SPM) for implementation together with the ECOWAS CET 2015 – 2019.
Then minister of Finance, Kemi Adeosun, explained that the ECOWAS CET, which will cover the 2017 to 2019 fiscal periods, is composed of three categories made up of an Import Adjustment Tax list of 173 tariff lines, a national list consisting of 91 items and an import prohibition list of 25 items, which is applicable to certain goods originating from non-ECOWAS member states.
Waivers, if well administered, are mechanisms for achieving set economic goals such as protection of local industries, job creation, export promotion as well as generation and preservation of foreign exchange. China, India, Malaysia, Japan and many other economies have at various times used waivers, concessions and grants to protect and build local manufacturing and agriculture. Sadly, none of such objectives has been met in Nigeria. Nonetheless, the interest of the local industry must be defended if the country would make any breakthrough or progress, and this is only possible if there is an enabling environment.
But there should be cause for optimism if the government’s commitment to due diligence, integrity and transparency is anything to go by.
Delivering affordable and adequate housing in Nigeria has always been a major challenge, with many policies, and sometimes lack of, posing as threats to achieving the goal of reducing the country’s immense housing deficit.
A lot of people believe that placing heavy import duties on imported products, especially those related to housing construction and development can help develop the local housing industry, but the reverse is actually the case.
The cost of local production and manufacturing in Nigeria is incredibly high, and only when those issues that lead to such high cost of production are resolved that we can argue more for the placement of heavy import duties.
Import Duty Waivers and Affordable Housing
It makes patriotic sense to place heavy import duties on importation, especially if there is an existent and vibrant local production industry, but it doesn’t make economic sense to do so if the local production and manufacturing industry lacks the capacity to operate independently with the ability to also minimize cost. Nigeria is grappling with perennial problems of infrastructure, which sometimes make local production an impossible dream. For those who can manage the local conditions, the quality of output is usually a far cry from what is acceptable as international standard. This has also been a bane for Nigeria export ambitions, as products usually fail to meet required standards.
Effective local manufacturing can only thrive and save cost if infrastructures like energy and power, water, market, roads, transportation and even personnel expertise are readily available. In the absence of this, it can even be cheaper to import quality products with the incentive of duty waivers.
The cost of producing building and construction materials in Nigeria are usually double the cost abroad because the manufacturers in Nigeria will have to bear extra cost of providing private power through the installation and fuelling of generators, building of private water supplies, company access roads, security, specialised transportation etc.
Manufacturing in Nigeria is definitely not a cake walk, and this is why local industry stakeholders would rather import finished products at lesser costs, and even better and cheaper for everyone, including the buyers when government can introduce temporary duty waivers.
These measures go a long way in reducing the cost of housing in Nigeria. Today, low and medium income earners who have between N5million to N10million can own their own homes. The demand for such low cost but high quality homes have spiked since these import waivers were introduced.
The Problem of Corruption
However, there have been concerns in some quarters that government policies like import duty waivers, concessions and grants tend to mainly favour cabals that are close to the government of the day. Worse still, the system has been too corrupted. Some beneficiaries are known to sell duly-approved waivers for essential goods to importers of other products that are of little or no benefit to the economy. Unfortunately, some defaulting companies in duties and levies to the Federal Government, notwithstanding their conduct, even got fresh waivers to import more in an era of impunity where monitoring was zero and the system was run without conscience.
This abuse got an official mention in 2015 at the Senate following a passionate submission by Senator Ibrahim Gubir. The upper chamber then decided on an ad hoc panel for a review to ensure full recovery of all government revenue related to the policy. Regrettably, as in most other investigations, the report has not been made public.
The expectation now is that such practises be reversed. A regime that favours economic cartels and selfish barons should have no place in the Nigerian economy. The controversies surrounding the import duty waivers are only present because of such backdoor practises.
Until Nigeria can fix its infrastructure problems like power outage, roads, water supply, etc., it will make more economic sense to import finished products. The purchasing cost, as we have seen in housing will come down and will create more economic stability. Of course the greater wish of Nigerians is for the country to have an active local industry where its goods and services can be made, but until a conducive environment is provided for that to happen, it will be cheaper to import, and import duty waivers are very important in that regard.
Councillors have called for a rethink of plans for a new block of flats because of lack of support for affordable housing.
Enfield planning officers had recommended giving the go-ahead to proposals to knock down two detached houses on The Ridgeway and build a two-storey block of flats on the site.
They said the nine flats – a mix of two and three-bed homes – would “optimise the site to its greatest extent” without harming the character of the surrounding area.
But councillors raised concerns over a financial assessment that stated the developer only needed to pay around 60 per cent of the expected sum of money to provide affordable homes in the borough.
Steven Woods, who lives in neighbouring Woodridge Close, spoke out against the plans at a meeting of the planning committee on Tuesday (April 23).
He said: “These properties are luxury apartments – why are the council proposing to take lower payments?
“I would ask the people on this committee, ‘do they think this development is going to benefit many people in Enfield or few people?’
“I am someone who looks at the many, not the few.
“Only a few people are going to benefit and make hundreds of thousands, if not millions – and we are compromising the money we are going to be taking from them in contributions.”
Enfield Council has a target of ensuring half of all homes on new developments are classed as affordable.
When this is not possible – such as on smaller sites with lower profit margins – developers are asked to pay a sum of money to help build affordable homes on other sites.
The applicant, Landvest Developments, submitted a viability report drawn up by Arebray Development consultancy – which was independently assessed by a commercial surveyor – stating it could make a contribution of £161,730 towards affordable homes.
That is only 60 per cent of a “normally expected figure” of £271,296 for developments of a similar scale.
Cllr Chris Bond, Labour member for Southbury, told the committee: “We should be getting £271,000.
“At this austere time that we are still in, I think it is amazing that someone is getting away with £100,000 less.
“Quite simply, they are not paying us the right amount of money.
“I will be looking at this figure more closely in future.”
Andy Higham, the council’s head of development management, said: “Officers take the issue of affordable housing contributions very seriously.
“It is not always possible on a scheme to get what we require. We have secured a good position using the same consultant we used on a scheme up in Cockfosters.”
But Labour member for Lower Edmonton Cllr Sinan Boztas said: “The affordable housing contribution needs to be higher for an area like Highlands.
“These figures need to be reconsidered.”
Councillors voted by a large majority to defer the application so the affordable homes contribution could be reconsidered.
The issue of developers making low contributions towards affordable housing was recently raised at a planning meeting in neighbouring Barnet.
Labour councillors there called on planning officers to drive a harder bargain after one developer backed down on claims it could not pay the full sum demanded by the Barnet Council and pledged to up its previous offer by more than £200,000.
More than 400 homes and retail units are set to be built in Stafford if planning bosses give the development the nod. green light.
The outline application for 430 homes and up to 575 sq m of retail space for land off Fairway in Littleworth has been recommended for approval by Stafford Borough Council’s officers, and the planning committee is set to make a decision next Tuesday week at a special meeting.
St Modwen Developments Ltd submitted the plans more than a year ago, and it has been called in to be considered by the committee by ward councillors over concerns that the area will cope with the extra traffic.
But officers have recommended the outline plans are approved at the meeting on April 30, subject to conditions.
The application site covers 23ha of land and is bounded by St Leonard’s Avenue/Fairway to the west, the West Coast Main Railway Line (WCMRL) to the south and by open land to the east and north, leading to the River Sow, with housing on Tixall Road beyond.
The application said the development would offer: In the plans it says: “In summary, the proposed site offers a full range of public amenities within a 1km distance.
“It has excellent transport links which make it a viable place to live for people of all ages and physical abilities, with higher than average railway connections and within walking distance from the town centre.
“It has numerous safe and convenient cycle and pedestrian routes that connect with local developments and facilities.“A wide variety of opportunities for employment with the town centre only 1km away, plus good access to facilities outside the town, such as the university, hospital and numerous leisure opportunities.
This would be in addition to “An opportunity to provide new build housing that is designed for modern standards of living in a location where there is little new development.”
“A settlement opportunity that is both accessible to existing amenities and town centre, whilst also on the edge of large green spaces leading out to open countryside.”
The site was previously occupied by the company Aviva, which had industrial buildings covering approximately 50 per cent of the overall area.
Only details of access have been submitted for approval at this stage. Current access to the site is off the roundabout that connects Fairway (north) and St Leonards Avenue (west).
Minor amendments will be made to the access road within the site in order to provide wider footways and grass verges.
If the outline plan is approved by councillors next week, the finer details will have to be approved in a reserved matters application at a later date.
More than half of U.S. seniors considered “middle income” won’t be able to afford assisted living and other forms of senior housing a decade from now, according to new research published Wednesday in the journal Health Affairs.
The study, led by NORC at the University of Chicago and researchers from Harvard Medical School, shows a critical void in future U.S. housing needs at a time when more than 10,000 baby boomers are turning 65 each day.
Though the housing market for Americans in need of assisted and independent living has greatly expanded, the cost is often out of reach for an increasing number of people considered middle income who are 75 and older.
“There’s a huge underserved market here,” Robert Kramer, founder and strategic advisor at the National Investment Center for Seniors Housing and Care, a nonprofit that provides data and analytics and works with investors and providers of senior housing. National Investment Center funded the NORC and Harvard research.
The study said 54% of middle-income seniors, or nearly 8 million people, will not be able to afford annual costs of $60,000 for assisted living, independent living or other housing related costs even if they allocated all of their annual resources to such housing. “Even assuming that seniors draw from their housing equity in addition to their income, 7.8 million (54 percent) middle-income seniors in 2029 will have annual financial resources of $60,000 or less,” the study shows.