December 4, 2024 Ward 3 Affordable Housing News Digest
Government Activity
District of Columbia
Board of Elections Certifies ANC Election Results
On December 2, the D.C. Board of Elections posted certified election results, including the results for Advisory Neighborhood Commissions (ANCs). In close races we’ve been watching:
Karrenthya Simmons, a staunch affordable housing supporter, beat the more equivocal Mark Rooney in ANC 3/4G’s SMD-05 by just 2 votes, 564-562.
In ANC 3A’s SMD-03, Isaac Bowers has defeated Maria Perisic by 8 votes (347-339).
There is still an opportunity for trailing candidates to request recounts. Where the margin in an ANC race is less than 10 votes, the requesting candidate is not required to pay for a recount, meaning there is little disincentive to requesting recounts in these two races. Any request for a recount must be filed by December 9.
On December 3, the Board of Elections posted names of successful write-in candidates:
In a write-in campaign for SMD-01 in ANC 3C (Cleveland Park/Woodley Park), Samuel Littauer prevailed over Lee Brian Reba, 136-59.
With respect to ANC 3E’s two SMDs on the American University campus, Elizabeth (Lizzie) Graff beat Asher Heisten 17-2 for the SMD-08 seat. The Board of Elections declared that there was no winner for the SMD-07 seat, where 5 write-in votes were cast. This likely means that the leading vote-getter did not file a timely “Affirmation of Write in Candidacy,” required for write-in candidates to be elected.
And in a write-in campaign for SMD-01 in ANC 3F (Van Ness/Wakefield/ North Cleveland Park), Amy Rofman defeated Sammy David Thumba, 230-47.
The Aston Finally Opens in West End
On November 25, Mayor Bowser, District leaders, and community members celebrated the opening of The Aston. The first-of-its-kind non-congregate shelter in the District’s adult homeless services system, the Aston will provide adults experiencing homelessness with semi-private rooms and individualized case management to support more effective connections to permanent housing.
The Aston’s non-congregate bridge housing model will serve three main populations:
Families without minor children, couples, and other household configurations — including those of different genders — who need stable short-term arrangements.
Individuals matched to a permanent housing resource through the District’s Continuum of Care who are working through their housing lease-up process.
Residents such as those experiencing chronic homelessness who are transitioning from unsheltered settings or low barrier shelter whose service needs are better met in this type of setting.
The District purchased The Aston, a former George Washington University dormitory, in August 2023 for $27.5 million. The Department of General Services (DGS) then made significant renovations and upgrades. Friendship Place will provide supportive services, including individualized case management.
Residents began moving in on November 15. The Aston will accommodate up to 50 people initially; over time that’s expected to increase to approximately 100 people. WAMU, WTOP, and WUSA9 also had stories.
The GW Hatchet has reported that in early November, the Board of Zoning Adjustment (BZA) rejected a neighborhood group's request to block The Aston from opening prior to the BZA’s scheduled January hearing on an appeal of the building permit.
A Washington Post story [gift link] quoted an attorney for shelter opponents the West End D.C. Community Association: “What the Aston poses is a very significant risk of adverse financial repercussions to businesses and serious detriment to the quality of life of the long-term residents who have lived in that location. . . . What [we] never understood is: Why this location? There are numerous locations that the city controls that would be far better situated for a homeless shelter. And the District doesn’t want to explain that.”
Councilmember Brooke Pinto offered an explanation: “Here in Ward 2, we have some of the highest amounts of people experiencing homelessness, and particularly those living outside.” She said there’s a need for non-congregate housing “where people can get on their feet and get organized,” and receive case management, job support and “everything else you need to live a sustainable life.”
Jim Malec, chair of the community advisory team and previous chair of the area’s Advisory Neighborhood Commission, said, “The majority of the community has always been behind this. That has been my sense of the sentiment of the neighborhood since the beginning of the process. . . . Obviously, there’s always a few loud voices who want to make sure they are heard. . . . We did hear them and made sure they were represented throughout the entire process.”
Council Approves Northeast Small Area Plans
On November 26, the D.C. Council voted unanimously to approve new small area plans for Ivy City and the Nannie Helen Burroughs Corridor in Northeast D.C. Office of Planning Director Anita Cozart described the approved small area plans as advancing “equitable community development in two majority-Black neighborhoods” and the product of extensive input from residents, business owners and other community stakeholders.
The Ivy City plan includes strategies for mitigating displacement pressures, expanding affordable housing opportunities, supporting homeownership, adding new landscaped gathering spaces, and reducing the impact of production, repair, and distribution-focused businesses in the neighborhood.
The Nannie Helen Burroughs plan “envisions a more vibrant corridor that includes a mix of uses, including retail and housing, parks and green spaces, and stronger pedestrian and multimodal connections.”
Council Reapproves Park Morton Disposition
Sam P.K. Collins reports in The Washington Informer that the D.C. Council unanimously passed the Bruce Monroe Disposition Extension Approval Act of 2023. The vote marks another milestone in the effort to convert the Park Morton public housing community in Northwest into the Bruce Monroe development, a mixed-used development providing affordable housing, market-rate housing, and amenities for community members’ use.
While the Council originally approved surplus and disposition authority in 2016, proceedings in the courts and at the D.C. Zoning Commission delayed the project. The new bill gives the D.C. government until December 20, 2026 to dispose of vacated public housing to make way for mixed-use development.
The project will deliver approximately 273 units, including a 76-unit mid-rise senior rental building, a 189-unit high-rise multifamily rental building, and 8 family-sized rental townhomes. Of these, 90 public housing replacement units will be made available to households earning at or below 30% AMI for former Park Morton residents. 111 of the units will be available to households earning at or below 60% AMI, and there will be 72 market rate units. Approximately one acre of the property will be retained by the District for use as a park and other public uses.
A report by the Council’s Committee on Business and Economic Development detailed testimony in opposition to the legislation, based on “inconsistent community engagement” by the Office of the Deputy Mayor for Planning and Economic Development (DMPED) and neighborhood concerns about the amount of space to be preserved as a park. While sharing concerns, particularly regarding how DMPED and the developer have engaged with the Park Morton Resident Council, the committee nonetheless felt a responsibility “to advance the extension legislation to the full Council, which has previously authorized this disposition.”
Council Resists City Liability to Talbert Street Homeowners
Many of the residents of the River East at Grandview Condominiums on Talbert Street, S.E., bought their homes with assistance from D.C. Home Purchase Assistance Program (HPAP). After moving in, they began to observe massive cracks in the walls and floors, uneven surfaces and a litany of other problems. Engineers determined that the property’s foundation was unsound, and residents were forced to evacuate in 2021.
The Washington Post reports that 40 of the 46 homeowners are still without permanent housing as of last week. In September, the D.C. Court of Appeals ruled that the District could be held liable as a merchant under the city’s Consumer Protection Procedures Act for its role in the approval and sale of the condos.
On November 21, D.C. Council Chairman Phil Mendelson introduced emergency legislation that effectively nullifies the appellate court’s ruling by stating that the District cannot be considered a merchant (except in rare cases involving the D.C. Housing Authority). On November 26, Mendelson’s bill passed 10-2, with only Councilmembers Robert White and Trayon White (whose ward contains Talbert Street S.E.) dissenting.
Some lawmakers, including Ward 3 Councilmember Matt Frumin, suggested that Robert White “should work with the city to determine individualized settlement amounts for each homeowner that could be allocated during next year’s budget process.” WUSA9 quoted Frumin as saying, “Yes we need high standards in the things that were built, but we’re not the people with the hammers and nails in our hands. If we take on liability for that, if we as a District do, then it forces us to get out of the game entirely.”
At The Washington Informer, Sam P.K. Collins adds that Mendelson introduced the bill at the urging of Mayor Bowser and Attorney General Brian Schwalb, to clarify that the District, in executing its governmental duties, cannot be designated as a merchant in its dealings with constituents.
ERAP Applications Close After 5 Hours
Annemarie Cuccia reported that the application portal for the Emergency Rental Assistance Program (ERAP) closed just five hours after it opened on November 20. In that time, residents applied for more than $20 million in rental assistance, reaching the amount that the Department of Human Services (DHS) projects can be supported with available FY 2025 funds. Applications are not scheduled to reopen until the Fall of 2025.
Changes to HPAP Program Confuse Homebuyers
As reported in the November 20 News Digest, the D.C. Department of Housing and Community Development (DHCD) made changes in late October affecting how it would determine assistance under the Home Purchase Assistance Program (HPAP), adopting a lottery system but giving conflicting explanations as to how the lottery would work. The program provides interest-free loans for low-to-moderate-income D.C. residents trying to become homeowners in D.C.'s expensive market.
Aaron Wiener and Meagan Flynn at The Washington Post [gift link] write that first-time home buyers who were relying on the program to help them finance new homes “say they were left with whiplash after the city announced last-minute rule changes to the program with conflicting explanations, imperiling their active home contracts.”
The District changed HPAP from a first-come, first-served system to a lottery “because of crushing demand and limited funds, marking the second consecutive year officials made major changes to the popular program with little or no warning to participants.” But the lottery rollout “suffered from communication failures and errors and caused acute stress for dozens of first-time home buyers — some of whom were left in the lurch after the city said they were mistakenly excluded from the lottery.”
A DHCD spokesman told the Post that ultimately all eligible home buyers who submitted a ratified contract by the deadline had been issued approvals. He later said that “a few eligible [participants] were inadvertently left off” the list, but “DHCD identified the error and has made an accommodation for their inclusion,”
Barry Farm Ribbon-Cutting and Groundbreaking
The Washington Informer, The Washington Post, and WTOP all reported on the November 21 grand opening ceremony for The Asberry, a 108-unit affordable housing development in Barry Farm. The event also served as the groundbreaking for The Edmonson, a 139-unit multifamily building that constitutes the second phase of new construction in the Barry Farm redevelopment, to be constructed by the D.C. Housing Authority and nonprofit developer Preservation of Affordable Housing (POAH).
The Asberry, which has 77 replacement units for former Barry Farm residents, is a 100% affordable, 55+ senior preference residential property with 33 units at 30% of Median Family Income (MFI), 44 units at 50% MFI, 21 units at 60% MFI, and 10 units at 80% MFI. The Edmonson will include 50 replacement units for former residents of the public housing at Barry Farm Dwellings.
"As a city, we made Barry Farm residents a promise under our New Communities Initiative — that we would welcome residents back into fantastic, safe, and affordable housing that honors and preserves the rich legacy of the community," Mayor Bowser said in a press release. "Today, we take another step forward in delivering on our promise in a way that respects and celebrates the history — and future — of Barry Farm-Hillsdale."
Concern about displacement, among other issues, helped fuel zoning and court challenges to initial development plans as residents and advocates sought to shape the project's scope and ensure the right to return.
Established in 1867, Barry Farm was created to provide formerly enslaved Black families with the opportunity to own land and build a community after the Civil War. The Barry Farm redevelopment will ultimately include 900 residential units, including at least 380 replacement units for former Barry Farm residents, 320 other affordable units, and 100 homeownership units. Officials have said the full Barry Farm redevelopment will be complete by 2030.
DCHA Making Progress Addressing HUD Report
Carolina Bomeny reported in Street Sense on the October 22 oversight roundtable held by the D.C. Council’s Housing Committee to examine progress by the D.C. Housing Authority (DCHA) in addressing recommendations of a highly critical 2022 report by the U.S. Department of Housing and Urban Development (HUD).
Committee Chair Robert White said DCHA has solved 75% of the 113 issues found in the report, which dinged the housing authority for issues like unlivable units in its public housing properties, low occupancy rates, and poor management of its voucher programs.
Bomeny says “nothing seemed to be off-limits” at the eight-hour hearing as DCHA faced intense scrutiny and a glimpse of praise from residents, advocates, and community leaders on its reform efforts. The committee heard from over 60 public witnesses about whether policies and achievements were improving the everyday lives of public housing residents and voucher holders. As the city’s largest landlord, over 50,000 District residents rely on DCHA for affordable and safe housing.
While community members who testified praised the achievements of DCHA’s Executive Director Keith Pettigrew’s first year, they were clear the agency still has a long way to go. . . .
Dozens of witnesses expressed concerns about the need for more clarity and communication around the agency’s new three-year recovery plan, the agency’s lack of transparency regarding the process for setting rents for housing vouchers, and the lack of resident representation in DCHA’s Stabilization and Reform (STAR) Board.
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In the last year, residents moved into 790 public housing units, raising the public housing occupancy from 74% to 84%, beating the agency’s goal of 83% occupancy by the end of December 2024. About 1,200 units are still available, excluding the 1,700 units that need more than a month to be fixed from unlivable conditions and the 500 that will be demolished or dispositioned [sic]
rather than brought back.
While DCHA also reached its goal of 85% voucher utilization, there are still 2,400 voucher holders that still need to be connected to housing, according to Pettigrew. Out of these 2,400, 1,100 have federal vouchers and 1,300 have vouchers issued by the city.
Virginia
Fairfax County Board Approves Housing on Vacant Commercial Sites in Springfield
According to FFXnow, on November 19 the Fairfax County Board of Supervisors unanimously approved Comprehensive Plan amendments to permit up to 732 multifamily units and ground-floor non-residential uses on multiple parcels along Springfield Blvd. and Amherst Avenue in Springfield. The 5-block area consists largely of vacant office, industrial and retail space with surface parking.
If done right, the new development will bring “a change that this community so needs,” said Franconia District Supervisor Rodney Lusk, whose district includes the sites in question.
The additional housing would be a welcome change for the region, Lusk said, noting that Springfield hasn’t added any new multifamily housing in over two decades. Construction began earlier this year on a 439-unit apartment building at Springfield Town Center, which is finally moving forward on redevelopment plans.
Federal
Congressional YIMBY Caucus Announced
On November 21, House members launched a bipartisan “YIMBY” (Yes in my backyard) caucus to address housing affordability and shortages, according to the Washington Examiner. The YIMBY movement advocates ending exclusionary bans for building apartments and student housing in residential areas, increasing funding for subsidized housing, and cutting permit waits, among myriad other policies.
The 25-member caucus is led by Rep. Robert Garcia (D-CA), and co-chaired by Reps. Lori Chavez-DeRemer (R-OR), Jake Auchincloss (D-MA), Juan Ciscomani (R-AZ), Scott Peters (D-CA), Chuck Edwards (R-NC), Brittany Pettersen (D-CO), and Marc Molinaro (R-NY). Politico has a short interview with Garcia about the caucus.
Trump Nominates Former NFL Player as HUD Secretary
As reported by Politico, among others, President-elect Donald Trump has selected motivational speaker Scott Turner of the America First Policy Institute (AFPI) to lead the Department of Housing and Urban Development (HUD). Turner is a former professional football player who also served in the Texas House of Representatives from 2013 to 2017. In the first Trump administration, he served as executive director of the White House Opportunity and Revitalization Council.
As HUD chief, he would likely seek to slash the department’s funding, reverse Biden-era fair housing policies and overhaul homelessness programs, all goals laid out by the Trump campaign.
While Turner’s views on housing issues aren’t clear, the AFPI agenda calls for “addressing the root causes of homelessness” rather than pursuing the “housing first” approach that Democrats favor.
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His selection was met with some befuddlement in the housing industry, as lobbyists scrambled to learn about him.
HUD Identifies “Next Generation” Housing Ideas
In October, the Office of Policy Development and Research (PD&R) of the Department of Housing and Urban Development (HUD) hosted a roundtable discussion of 25 participating scholars to discuss the “Next Generation of Housing Policy.” In a new article, PD&R summarizes “some of the big ideas and conversation generated through the roundtable” to address 5 topics: expanding the housing supply, eliminating worst case housing needs, ending homelessness, protecting renters, and increasing homeownership.
News/Commentary
District of Columbia
Slumlord Tricked Tenants Out of TOPA Rights
In Washington City Paper, Suzie Amanuel has a long story headlined, “How a D.C. ‘Slumlord’ Scammed Tenants and Lenders to Build a Portfolio of Neglected Properties, According to Lawsuits and Tenant Accounts.” The story reports on a lawsuit filed by the tenants at 741 Longfellow St. N.W., who believe Ali “Sam” Razjooyan “masterminded a scheme to trick them out of their TOPA [Tenant Opportunity to Purchase Act] rights in order to buy their building without ever intending to honor the agreement” to renovate the building and improve property management services, among other things.
Razjooyan has become a notorious character among local tenants and housing advocates. By his own count, he has amassed a portfolio of 54 buildings with 600 units in D.C. Multiple lawsuits from tenants accuse him of deceitful tactics and neglect. Many of them live in harrowing conditions and use housing vouchers to pay at least part of their rent. D.C. Attorney General Brian Schwalb is currently suing Razjooyan for “egregious housing code violations” at two complexes . . . .
Moderate Income Earners Squeezed Out of D.C. Housing
The Washington Informer has an article on how working-class D.C. residents are caught between unaffordable rents and income limits for rental assistance programs. The article quotes Stephen Glaude, President and CEO of the Coalition for Non-Profit Housing and Economic Development (CNHED):
So, lower-middle income is the new lower income. Meaning that typically, you try to provide housing assistance between zero and 80 [percent of area median income] (AMI). But we see a big need between 80 and 120 (AMI), and what that really means in layman’s terms is that typically we direct subsidies and resources and assistance, to the very low income. . . . But what we’re seeing in D.C., because of our market pressures, is that we need assistance for lower middle-income people as well, which is really the upper band of people that cannot independently afford housing in the District of Columbia.
Should Tenants Be Allowed to Be VRBO and Airbnb Hosts?
Under current D.C. law, those who rent their homes — which is more than half of D.C. residents — are unable to rent out a spare bedroom on a short-term basis as a source of extra income. In an opinion piece in Greater Greater Washington, Synta Keeling urges the D.C. Council to allow tenants to host short-term guests, with their landlords’ approval, saying this would would eliminate a major inequity between those who own their homes and those who rent their homes.
Ward 1 Councilmember Brianne Nadeau has proposed such a bill, the “Tenant and Rowhouse Short-Term Rental Clarification Amendment Act of 2023.” The bill had a hearing in October 2023 before the Committee on Public Works and Operations, but awaits further action by the Council.
D.C. Now the Most Sought-After City for Renters
RentCafe says Washington, D.C. is now the most sought-after city for renters in search of apartments, based on millions of searches and other interactions on RentCafe.com.
After steadily climbing the rankings since the start of the year, Washington, D.C., has finally secured the top spot in October. By and large, renters are eyeing the nation’s capital due to its great combination of an excellent public transit system, quality healthcare, and overall good quality of life, as well its low unemployment rate. Accordingly, this is reflected in a 3% decrease in available listings . . . .
Nationwide
Homebuilders Encouraged by Trump’s Election
At The Washington Post [gift link], Rachel Siegel writes that homebuilder sentiment is high in the wake of Donald Trump’s election.
After years of tumult in the housing market, builders across the country are betting that looser regulations and what they hope will be an economic boom will make it easier to build and sell. They’re also hoping those tailwinds more than offset possible hazards of Trump’s agenda, including ramped-up tariffs on Canada, Mexico and China that could push up costs for materials, and aggressive immigration policies that could mean the deportations of construction workers.
In an opinion column in The Washington Post, Heather Long says high housing costs have become part of the economic “vibes” — alongside gas and grocery prices — that people see on a regular basis. Trump got elected promising lower mortgage interest rates, but they’re rising. Presidents don’t control mortgage rates, and they might turn out to be Trump’s Achilles’ heel. “And just the threat of his proposed economic agenda, widely viewed as inflationary, has worsened the problem before he has taken office.”
Fix the Blue States
In a November 25 editorial, The Washington Post says that if Democrats want to win the presidency back, they need to improve the places they already govern. The Post notes that, based on current population trends, blue states are expected to lose 12 House seats — and electoral college votes — after the 2030 census. Those seats will be gained by mostly reddish states.
Today, “public disorder mars too many blue bastions like San Francisco and Chicago.”
But the worst problem many of these areas have is their seeming inability to build anything at a reasonable cost, especially affordable housing. One reason so many people are fleeing blue states such as New York and California is that their major metropolitan areas are consistently the highest-cost places to live.
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With the best of intentions, Democratic-run state governments have allowed burdensome regulations and bureaucratic inertia to stifle growth and allowed special interests to stymie construction of housing, infrastructure and other necessary projects.
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There are some signs reform is beginning to happen. A YIMBY — yes in my backyard — movement is scoring victories in places such as Arlington, Virginia, where leaders are pushing to cut zoning rules that bar building townhouses, garden apartments and other affordable housing options.
More and more drastic reform is needed, not just for the sake of the Democratic Party but for the sake of the cities and states where it dominates local politics.
The Housing Movement Is Divided Against Itself
At Vox, Rachel Cohen says there seems to be widespread agreement that the U.S. needs more housing and fewer barriers to making that happen. But “this YIMBY-ish agreement across the political spectrum can mask deeper divides, including about property rights, community development, and the very meaning of democracy in housing policy.”
Cohen looks at three recently-published books that illustrate the divergent approaches to solving the problem:
Escaping the Housing Trap by urbanists Charles Marohn and Daniel Herriges of Strong Towns advocates for a slower-paced, locally driven form of development that they believe will be more sustainable over the long term. On the Housing Crisis by journalist Jerusalem Demsas challenges this kind of incrementalism, arguing the severity of today’s housing shortage demands bolder intervention. And in Nowhere to Live, James Burling, a lawyer with the libertarian Pacific Legal Foundation, frames the housing shortage as the result of diminished respect for private property, something he argues will have to be reversed for any real change.
One of the issues is what level of government should make policy choices, and how much democratic preferences should matter.
For decades, the federal government largely deferred to state governments on matters of land use. States mostly deferred to local governments, which in turn typically deferred to their home-owning constituents who backed restrictive zoning laws that barred new construction. But with housing now consuming a greater portion of households’ budgets, even federal lawmakers can no longer avoid addressing the dramatic rise in rents and mortgage payments.
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Research increasingly shows that local planning meetings are deeply unrepresentative, with participants skewing older, whiter, more likely to be a homeowner — and therefore more likely to support measures that prioritize their property values and the status quo.
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Public interest litigation and community input rules emerged to protect neighborhoods from destructive top-down planning like the urban renewal that devastated Black neighborhoods in the 1960s. But this democratic vision has evolved into a more routine participatory veto, where multiple choke points, from environmental impact reviews to historic preservation requirements, allow individuals to block housing projects or make them so financially unfeasible that developers withdraw their bids.
Cohen notes that many pro-housing advocates have turned to state-level intervention, essentially arguing that sometimes real democracy requires overriding local democratic processes. But the “political path forward is murky.”
Where Could the Government Actually Build Freedom Cities?
Opening up federal land was a key element of President-elect Donald Trump’s plan for increasing housing. He added an unusual spin, proposing that America build 10 “freedom cities” on federal land. In M. Nolan Gray's Newsletter, Gray examines where such cities could actually be built.
Although the vast majority of federal land “is either in the middle of nowhere or carved up by mountains,” Gray says “the federal government really does own a lot of land well-suited to housing — and is uniquely positioned to build it, given its insulation from local zoning and complaining local NIMBYs.”
In states like Arizona, Colorado, Idaho, Nevada, and Utah — the five states that had the most extreme run-up in home prices over the past four years — most cities are hemmed in by federal land. Selling off close-in federal lands for housing development will help to bring prices down.
After identifying five possible “freedom city” sites spread across the West, Gray floats some additional ideas for how to use federal land to address housing shortages:
The most acute housing shortages in the country can be found in Mountain West resort towns like Aspen and Lake Tahoe, where NIMBYs have made it impossible to build workforce housing. These cities are all surrounded by National Forests. Small amounts of land at the edge of forests could be allocated for workforce housing.
On the Central Coast of California, two massive Defense Department sites, Fort Hunter Ligget and Vandenberg Space Force Base, could release excess land for needed housing.
The U.S. Postal Service is one of the largest urban landowners in the country. Congress should clarify that the USPS is exempt from local zoning and direct it to start building housing above its retail facilities.
Across the country, small airports are closing. In places like high-cost Santa Monica, NIMBYs are fighting to block housing on the site of soon-to-be-shuttered airports. The Federal Aviation Administration should condition the closure of any urban airport on a binding agreement to build housing on the site.
Nearly a Third of Homebuyers Pay Cash
The Washington Post [gift link] reported that nationally, “nearly a third of home buyers navigating the high mortgage rates, rising home prices and low inventory are somehow buying their homes entirely in cash,” according to data from Redfin.
The trend is somewhat less pronounced in the D.C. Metro area, where all-cash sales have gone from 15% in 2018 to 29% in 2023 and 27% in 2024.
Many of the all-cash buyers obtain the funds by selling a previous home, but the rising trend of cash purchases makes it even harder for first-time home buyers to compete. Between July 2023 and June 2024, the share of first-time home buyers in the market was a record-low 24%.
As cash purchases have become more common, the median age of home buyers has crept up to 56. Even for first-time buyers, the median age has risen from 35 last year to 38.
More Than 1 in 5 Renters Say Their Entire Paycheck Goes to Rent
According to a new survey from Redfin, 22% of U.S. renters say all of their regular income goes directly to paying their rent. To afford rent payments, 20% of renters have worked a second job, 18% have received government assistance, 14% got cash gifts from family, and 13% withdrew money early from retirement funds.
Affordable Apartments Lead Rent Growth
A report from CoStar says asking rents for one- and two-star rental properties increased at an annual rate of 2.2% in the third quarter of 2024, nearly double the national average rent growth rate of 1.2%. In stark contrast, luxury four- and five-star properties, which had double-digit growth rates during the market boom in 2021, have seen their rent growth slow sharply.
Lower-rated properties have now led rent growth for the last 8 quarters. The vacancy rate for one- and two-star properties has remained relatively steady, and is now at 5.3%.
Meanwhile, the vacancy rate for four- and five-star properties now stands at 11.4%. The market’s oversupply issues are concentrated almost exclusively in higher-tier properties. Roughly 75% of new supply since the pandemic has been in the four- and five-star category, with the remaining balance predominantly in mid-level three-star-rated developments. This deluge of luxury units has pushed vacancy rates higher and forced landlords to offer significant concessions to attract tenants.
The bottom line is that demand for affordable housing remains robust, and unlike their luxury counterparts, these more affordable properties have not been inundated with new supply.
A separate report from Realtor.com says rents fell by 0.8% to $1,720 in October, marking the 15th consecutive month of year-over-year declines, falling the most for smaller-sized units. Growing rental supply remains key for the 2024 and 2025 rental market. If current trends persist throughout an entire year, the rental housing stock is expected to increase 1.1% to over 49 million units by fall 2025, reaching a level that is 6.7% higher than the fall 2019 pre-pandemic rental stock.
How to Measure the Housing Supply Shortage?
At Brookings, scholars Elena Patel, Aastha Rajan, and Natalie Tomeh say that recent estimates of America’s housing shortage “range from 1.5 to 5.5 million units, with variation driven by a combination of methodological differences in calculating the shortage and different characterizations about what constitutes equilibrium in the housing market.”
After explaining the various methodologies, they settle on Oaxaca-Blinder decomposition, and conclude:
Using the latest data available by the 2023 American Community Survey and the Housing Vacancy Survey and following the method employed by Freddie Mac, we estimate the U.S. housing market was short 4.9 million units at the end of 2023.
Coincidentally, Freddie Mac also updated its own estimate of the housing shortage.
Our updated estimates show that the housing market is still dramatically undersupplied relative to long-run housing demand. Despite adding 5.8 million housing units over approximately four years (since our previous estimate), housing demand has increased by almost the same amount, resulting in very little progress in reducing the housing shortage. In the aggregate, we estimate that U.S. housing stock is 3.7 million units below what is needed given our current population . . . .
Landlords Mostly Evict Tenants Who Will Never Pay Them
In his blog Rent Free, Christian Britschgi flags a new working paper on residential evictions which finds that the costs of eviction are high to a landlord, that landlords frequently offer temporarily delinquent renters forbearance agreements, and that the most common tenant protection policies likely do little to ultimately prevent evictions.
As a result "landlords usually allow tenants to default for multiple months before incurring the costs of eviction, and the majority of evictions involve tenants who are persistent non-payers."
Other States (or in Particular, New York City)
Will New Tax Abatement for NYC Encourage Smaller Buildings?
A Bisnow conference looked at the structure of the new tax abatement to encourage construction of affordable housing in New York City. Last spring, the state legislature adopted a provision known as “485-x” to replaced the expired “421-a” tax abatement policy.
Developers using 485-x to develop buildings with 150 units or more can claim a 40-year tax break if 25% of units are kept affordable for renters making no more than 60% of the area median income. A second option is a 35-year break for buildings with 100 or more units as long as a quarter of units are kept at 80% AMI.
A third option, available for buildings between 6 and 99 units, involves setting aside 20% of units at 80% of AMI. But more importantly, it allows developers to skirt construction wage minimums that were also put in place by 485-x. The new tax incentive puts minimum construction wages in place for large rental projects — 100 units or more — below 96th Street in Manhattan or in Brooklyn and Queens neighborhoods close to the East River.
Conference participants said the minimum wage requirements for larger buildings create a strong incentive for developers to focus on building projects of fewer than 100 units. The result, developers said, is that the incentive won’t yield anywhere near as much housing as the city needs to fix its supply crisis.
5 Ways to Fix New York City’s Housing Crisis
At The New York Times [gift link], Mihir Zaveri writes that “There is no one, clear solution to New York City’s housing crisis. Instead, the right path forward will most likely involve putting together bits and pieces of many competing ideas.” In this article, he asked five people from different backgrounds to suggest a few ways they think the city should move forward, and got ideas ranging from rethinking the rent stabilization program, to creating a social housing development authority, to requiring total transparency upfront on all apartment fees.
The article is part of a five-part series on New York City’s affordable housing crisis.
A YIMBY Candidate for Mayor
Politico reports that New York Sen. Zellnor Myrie (D–Brooklyn) has officially announced his plans to run for New York City mayor on an aggressively pro-YIMBY platform. His Rebuild NYC plan calls for getting New York City to build 700,000 new housing units in the next decade and preserve 300,000 more, a construction rate not seen in the city since the boom of the 1920s, through a mix of upzoning, building code reforms, and affordable housing mandates.
Watered Down “City of Yes” Rezoning Proposal Nears Approval
In Reason, Christian Britschgi writes that New York Mayor Eric Adams’ “City of Yes for Housing Opportunity” rezoning proposal is nearing the finish line. Along the way, the city's community boards and borough presidents demanded changes, and the City Planning Commission and City Council inserted amendments that all had the effect of watering the proposal down. The plan now goes back to the City Planning Commission for one final look before the whole City Council votes on it.
“The ultimate version of the City of Yes is less ambitious than what Adams proposed and enables less housing than what many housing policy wonks say the city needs. Still, progress is progress.” The city estimated that Adams' original City of Yes plan would enable an additional 109,000 housing units to be built. The City Council's amendments whittle this down to 80,000 units—and that's a very rough estimate.
The City says that the the City Council is expected to pass a modified version of the proposal on December 5, allowing New York City to “join a growing list of cities around the country that have updated rules in a bid to spur more housing.” While the plan “ builds on ideas implemented elsewhere in the U.S., left unsaid is a harsh reality for the nation’s biggest metropolis: smaller cities that recently revamped their zoning codes far outdid New York City’s changes.”
Short Takes From Around the Country
An article in PD&R Edge looks at a mixed-use development in Buffalo, New York, where a historic school and community center building was renovated to provide 42 apartments for households earning up to 50% and 60% of the area median income. Four units are adapted for those with physical disabilities or mobility limitations, and three for residents with hearing or vision impairments. In addition, 12 units are specifically designated for domestic violence survivors who formerly experienced homelessness.
CoStar reports that CalPERS, the giant California public sector pension fund, is expanding its commitment to Nuveen Real Estate's affordable housing strategy with an additional $400 million allocation. The Nuveen Real Estate U.S. Affordable Housing Fund seeks to invest in and preserve affordable housing, and its affordable housing portfolio now comprises nearly 31,900 housing units across the United States valued at $5.7 billion.
On December 2, the country’s biggest apartment owner, Greystar Real Estate Partners, opened its first modular apartment complex, according to Bisnow. Ltd. Findlay, a 6-building, 312-unit modular apartment complex in Coraopolis, Pennsylvania, was developed at Greystar’s modular factory in Knox, Pennsylvania. Greystar built Ltd. Findlay about 40% faster than its traditional apartment complexes. The on-site construction of the modules used a third of the usual workforce and generated 90% less waste. The project was also 10% cheaper than the construction of a traditional multifamily project in Pittsburgh.
An article in Stateline summarizes steps cities around the country are taking to encourage the conversion of unused office space into much-needed housing. They include reductions in approval times, exemptions from affordable housing rules, and changes in building code requirements. Some cities and states also are providing tax incentives or subsidies to developers. The article notes that the D.C. Metro area “led the nation in adaptive reuse from 2021 to 2024, creating 5,820 new housing units from office properties.”
Bisnow says a Philadelphia-area startup, Nido, offers a way for landlords attract and retain tenants — at least for a while. Nido provides a platform for landlords to place 5% of a tenant’s monthly rent into a nest egg savings account which the tenants can then use to buy a home down the line. It may seem counterintuitive for landlords, but in a highly-competitive market like Philadelphia, where high supply has given renters plenty of options and lots of leverage, the promise of help with a future home purchase can be a powerful way to distinguish the landlord’s properties.
In his blog Rent Free, Christian Britschgi tells how the the Yakama Nation tribal government had to assert its rights under an 1855 treaty with the federal government to prevent the city of Toppenish, Washington, from limiting the hours of operations of a 50-bed, cold weather homeless shelter operated by the tribe.
Berkeley, California, formerly a NIMBY stronghold, has elected a YIMBY, Adena Ishii, as its new mayor, according to an opinion piece in the San Francisco Chronicle. Ishii’s opponent, Berkeley City Council Member Sophie Hahn, cut her political teeth trying to block the city’s Downtown Plan, which dramatically increased the number and building height limit of homes that could be built in the downtown corridor. Hahn had also blocked a bike lane, siding with a small but vocal neighborhood group that argued the bike lane would harm property values, even going so far as to claim it would “destroy the neighborhood.”
WPRI reports that Providence, Rhode Island, has enacted a new comprehensive land use plan that calls for more types of housing and more affordable housing, but also more regulation of the aesthetics of what new housing can look like.
International
The Tokyo Example
An article in PD&R Edge looks at Tokyo, which “has avoided a housing crisis, and housing in the city is relatively affordable.”
Japanese homes are designed to maximize efficiency and affordability, because they must withstand the reality of frequent earthquakes. This need results in a rapid cycle of tearing down and rebuilding housing, enabling cities to swiftly meet current market demands. . . .
By contrast, many Western cities are hindered by zoning regulations that mandate single-family homes, limit the construction of large residential blocks, and separate land uses. In Tokyo, the absence of such restrictions encourages housing construction and permits the collocation of residential, commercial, and mixed-use developments. This flexibility enhances the city's appeal and keeps property and rent costs low, making Tokyo a model for adaptable and vibrant urban living.
Calendar
December 5 — Webinar, “The Other 41: Mid-Rise Housing for a High-Rise City,” 6:00 p.m. Zoning reforms in New York City aim to unlock moderate density with smaller, more mid-rise buildings. How will this affect affordability? What are the challenges, opportunities, and costs? Presented by AIA New York and the Joint Center for Housing Studies of Harvard University. Register here.
December 9 — Next regular meeting of ANC 3/4G (Chevy Chase). Hybrid, on Zoom and in-person at the Chevy Chase Community Center, 7:00-8:45. The agenda includes “Discussion, Possible Vote Regarding Upcoming Zoning Commission Hearing on proposed zoning changes for Upper Connecticut Ave.” Register for Zoom attendance here.
December 12 — Next regular meeting of ANC 3E (Friendship Heights & Tenleytown), 7:30 p.m., online. Register here.
December 16 — Next regular meeting of ANC 3C (Cleveland Park and Woodley Park), 7:00-9:00, online.
December 17 — Next regular meeting of ANC 3A (Middle Wisconsin Avenue), 7:00 p.m. in person at the McLean Gardens Ballroom and virtually via Zoom.
December 19 — The D.C. Zoning Commission will hold a public meeting to consider final action on its proposal to rezone the Chevy Chase Civic Core and surrounding blocks of Connecticut Avenue. The 30-day public comment period on the proposal closed on December 1. The agenda also includes consideration of Case No. 24-09, Wesley Theological Seminary’s petition for a text amendment to permit Landmark Properties REIT to build a 9-story student apartment building on Wesley’s campus and to modify Inclusionary Zoning (IZ) requirements for the project. 4:00 p.m., online.
January 14 — Next regular meeting of ANC 3F (Van Ness), 7:00-9:00 p.m., online.
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