May 27, 2002
Realtors are frequently asked how can people afford to live in San Diego County
if government doesn't intervene in the market place to bring down the price of
housing? Apparently, there's little understanding by a great many people of how
homebuilders have built more square feet of housing per capita in the United
States than homebuilders or governments have built in any other country of the
world.
In 1996 the San Diego Housing Commission built 54 low-income apartments at 4720
Logan Avenue at a cost per unit ($148,702) greater than the 10 most expensive
apartment buildings sold for in San Diego, including Pacific Beach and La Jolla
in the previous four years. The new low-income apartments investigated by the
Inspector General of HUD, were more expensive than some brand new condominiums
comparable in size were selling for at 7575 Hazard Center Dr. in Mission Valley,
and 11862 Scripps Creek Dr. in Scripps Ranch.
Furthermore, federal studies and lawsuits going back 30 years confirm that
government provided housing costs from 20% to 40% more than private built
housing, depending on whether its brand new or pre-existing. If the
government built all housing in this country we would have 20% to 40% less
housing. This is government in action and alone is reason enough to Free
the Free Market in housing!
According to the Census Bureau in its 1994 American Housing Survey for San
Diego, the most recent survey, there were 50,100 households that paid $200 to
$299 per month in 1994 of which the City & County Housing Authorities (C&CHA)
provided 2,392 units or 5% of the total. There were 73,200 households that paid
from $300 to $399 of which C&CHA provided 2,392 or 2% of the total. In each of
the remaining categories, up to $999 per month the C&CHA provided less than 2%.
Remember, this was back in 1994. This is consistent with Census data
showing Government, throughout the U.S., provides or subsidizes less than 5% of
all housing.
In other words, the capitalistic, free enterprise, “for profit” market in 1994
provided 20 times as much low-income housing as the “non-profit” C&CHA in the
$200 to $299 range, 50 times as much in the $300 to $399 range, and 50 to 100
times as much housing in the remaining four categories served by the City &
County Housing Authorities. If you want more housing Free the Free Market!
A University of Michigan study, NEW HOMES AND POOR PEOPLE,
affirmed that the construction of 1,000 new dwelling units, both homes
and apartments, makes it possible for 3,545 households to move to better
accommodations. Of the 3,545 moves surveyed, 1,290 were by low and
moderate-income families. This is the essence of upward mobility. In other
words, Free the Free Market! Any one who didn’t move to a brand new
house or apartment when they left their parents home or graduated from college,
know how the housing market works. Used housing is “affordable housing.” Not all
used housing is affordable of course, but the private market supplies far more
housing for low-income people than government. It just isn’t the most expensive,
brand new housing.
When housing activists refer to “Affordable Housing” they don’t simply mean
decent, safe, clean homes for low-income families. They mean brand new or nearly
new housing should be provided or subsidized for poor people by other families,
many of whom are struggling just to pay their own way.
As the University of Michigan study demonstrated the best, most cost-effective
way to help low-income families is to Free the Free Market, encourage more
construction of every type of housing which allows more opportunities for upward
mobility than government will ever be able to afford. All that’s needed to
dramatically increase the supply of housing in San Diego and bring down its
cost, is to rescind the "Chain of Exclusions," zone more land for higher density
throughout the region (while respecting CC&Rs), increase certainty in the permit
process through Performance Zoning, and do whatever is required to guarantee
that it will take no longer than one year to issue construction permits. That’s
it. Everything else is buffalo chips!
Permission granted to forward to others
and quote with or without credit
Fred
Schnaubelt
