Affordable Housing Townhall
On October 1 there was a Lakewood townhall meeting on affordable housing. Ward 5 Councilors Janssen and Strom hosted the meeting but representatives of all wards were present. Speakers at the meeting were representatives from Metro West Housing Solutions (MWHS).
MWHS is a developer active in Lakewood since 2008, before that they were active in the market by a different name since 1974. They work to develop and manage properties for households with income that is 30-60% of the median household income level (ie <30% of the population).
The question was asked, what about affordable housing for residents that don’t meet the income requirements. The answer was that it’s a question for Lakewood City Council and they are looking into options.
Options for what any government can do to intercede in market pricing has many precedents, but few working solutions. Rent control and price fixing are failed examples of government intervention.
Metro West Housing Solutions provide modern-day examples of problems with trying to be affordable. Example 1: MWHS only rents property. By their own admission, they could not sell properties they develop because even at cost the price would not be affordable. If they do sell the property to one entity, that entity can (and does) sell the property at a higher price because that’s what the market will bear.
Example 2: One of the target demographics for MWHS is seniors on Social Security income, income which is often not enough to afford to move out of their large houses into a more manageable-sized unit. Allowing a senior to move into MWHS property may result in a larger home being sold. For affordable rates? Generally not, since said senior will have to get the most out of the property they can.
Government favoring low-income, or affordable, housing is sometimes done by allowing developers who include affordable housing to build more than others. This is called inclusionary zoning. Once again, there is enough data to show that these policies have not worked in the past.
Bigger picture, the city meeting did not and could not address the problem for those people who do not qualify for affordable housing. Most rents and mortgages will remain the same and those rates are rising. The reason for this is easy: Colorado is a desirable place to live and Lakewood is a prime location for work and recreation alike.
The solution to high prices is generally to increase supply. In this case, build more homes. Since rental units are exempt from the Strategic Growth Initiative, building more apartments is an easy answer. That is good for the individual but is it good for the community?
High residential communities have an increased burden of infrastructure, including traffic and police. Without the increased sales taxes from retail and commercial properties, high-density residential can have a hard time paying for increased infrastructure. For example, when asked about crime, a Sergeant from the Community Action Team said that low-income housing does not have more crime than other units, but that any place that has a large parking lot was a target. However, no solution has been offered on how to provide enough security so that people feel safe.
There were also conflicting stories offered on how new high-density growth will affect surrounding home prices. MHWS representatives claim that studies show home prices in the area go up. A local resident that was present argued she personally knew people whose home prices went down drastically after high-density apartments were built in place of the originally planned strip mall.
The meeting had some ideas for the future, including adding MWHS as a line item to the city budget and holding a future meeting on economic development.