What if govt gave $1T for affordable housing?

VP in RE - Comm

Just bored out of my mind during this isolation but was talking with a coworker (over Zoom of course) and just threw out randomly the idea if the govt funded $1T in affordable housing in the stimulus. Without even assuming debt and assuming construction costs average of $150k a/unit (remember this is the average including smaller markets), you're looking at about 6.6M units, which the govt would actually profit from since there would be rent coming in, maybe not a lot since they are affordable but probably more than 2% I'd imagine. Or assuming a 50% LTV, you're looking at 13.2M units being built, which would probably solve our affordable housing crisis for awhile.

Comments (12)

Mar 24, 2020

Well that's if they all pay and how do you come up with your figure of cost per unit ?

Mar 24, 2020

Solving the affordable housing crisis would be done by allowing real estate to be developed. I am in the SF Bay Area, home to in my opinion, the worst housing crisis in the U.S and many cities won't even allow you to build an apartment complex since it will bring in "less desirable" non-land owning peasants. Honestly sick how protectionist these nimby shits are

https://www.nytimes.com/2020/02/13/business/econom...

Mar 24, 2020

Only a multi-faceted approach will solve the crisis.

  1. The absurdist NIMBYism in certain areas in the country needs to be outlawed. Single family restrictive zoning in urban areas should be abolished. Allow developers to build and build they will.
  2. The government should also be financing and/or building public housing for low income people. Public Housing in America was a terrific success until the program was gutted financially. The asset management and property management failures of the program over time led to the infamous "projects" and "ghettos" of the 70's and 80's. Other countries have terrific public housing.
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Mar 24, 2020

I have to agree that NIMBYism in certain areas is a huge problem. San Francisco is a great example. No buildings above 40 feet tall except where zoned (which is a small portion of the city where the majority of the skyscrapers are as it stands) greatly inhibits SF's ability to have affordable housing, and the problem then extends out into the surrounding towns, causing a dearth of affordable housing and a significant increase in traffic. The Rent Control laws in NYC are another. My Uncle, may he rest in peace, had a rent controlled apartment for 40+ years in the city. I know people who are living in the same rent controlled apartment that has been rented and passed down because of the capped prices. That's not helpful at all to help make housing affordable. Though the number of Rent Controlled apartments in the city is coming down. In a blatant case of NIMBYism, Darrien CT recently demanded that the mobile Coronavirus testing center be moved out of Darrien because they didn't want it there.

Shit like that hurts the viability of making these projects work and actualy doing good.

Mar 25, 2020

To be fair, NIMBYism runs the gamut, it's not only rich people trying to push out tenants or services they think will depress land values. Poorer tenants can be among the most ferocious NIMBYs, either from fears of gentrification pushing them out of their homes down the road (sometimes a reasonable concern) or because they feel that the neighborhood "belongs" to them and that demographic change will bring in "different" neighbors (always absurd).

Moreover, zoning isn't always an example of NIMBYism. To your point about San Fran (a market I don't know a ton about), if you put a 60 story skyscraper in a district full of single family homes, that might in fact have a net deleterious effect on public health and safety.

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Mar 24, 2020

That's honestly more than is needed. There are about 6 million rent burdened households in the US and then another half a million homeless. The balance of the money could be used to rehabilitate existing public housing stock and neglected project based section 8 deals.

Mar 24, 2020

What is "rent burdened?" 40% of gross income? 50%? I'm kind of surprised it's only 6M households. If the average household size is 2.6, that's just over 15M people.

Mar 24, 2020

*36 million, my bad.

Mar 25, 2020
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