May 9, 2002
A great many people ask how will people be able to afford to live in San
Diego if the government doesn't intervene in the market place to bring down the
price of housing? Apparently, there is 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.
The housing market operates much like the automobile market. Cadillacs,
Lincolns and Chryslers are not built for poor people, nor even Fords and Chevys.
However, the U.S. Census notes that most poor families own one or more cars.
They buy them used and trade up as income increases. Can you imagine Mercedes
being forced to sell 10% or 20% of it cars to low-income families?
According to The University of Michigan study, NEW HOME AND POOR PEOPLE, 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. Any one who didn't move to a brand new house 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.
According to the Census Bureau in its 1994 American Housing Survey for San
Diego, the most recent report, there were 55,200 households paying from $100 to
$199 per month in 1994 of which the City & County Housing Authorities (C&CHA)
provided 4,633 units or 8% of the total. Of the 50,100 households that paid $200
to $299 per month, 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 pro-vided 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%. Government, in the U.S., provides less than
5% of all housing.
In other words, the capitalistic, free enterprise, "for profit" market in
1994 provided 12 times as much low-income housing as the "non-profit" C&CHA
in the lowest category, 20 times as much 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.
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.
When housing activists refer to "Affordable Housing" they don't 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 which 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 encourage more construction of every type
of housing which allows more opportunities for upward mobility. All that's
needed to dramatically increase the supply of housing in San Diego and bring
down its cost, is to zone more land for higher density throughout the region
(while respecting CC&Rs), increase certainty in the permit process, 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!
Fred Schnaubelt, City Councilman 1977-81, 2728 Adams Ave., S.D. 92116 (619)
280-2082
Real estate broker since 1969, has had published over 90 articles on major real
estate issues
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