What is a Housing Bank and Why Do We Need One?
How Would a Housing Bank Be Funded?
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Q & A
Questions & Answers about
The Housing Bank
What
is perpetual affordability?
Perpetual affordability is a fundamental objective of the Housing Bank
and is needed to assure that our efforts to solve this problem are permanent
solutions. In order to achieve perpetual affordability, the investment
that we make in a pool of affordable homes must be managed in a way that
homeowners can continue to afford these homes in the future. The simplest
form of perpetual affordability (but not the only form) is to index home
resale prices to wages (or another accepted index such as the consumer
price index or the producer price index.)
Doesn’t indexing sale price deny homeowners
their rightful profit on their investment?
A home is the most important investment for many of us and the homeowner
should be allowed to benefit from this investment. However, the homes
provided by the Housing Bank are not intended to benefit from speculation.
Homeowners will accumulate equity by virtue of their mortgage payments
and are also protected against inflation. They also receive the tax benefits
of any other homeowner. For a homeowner who would otherwise not be able
to afford a home in San Juan County, we believe that this is a fair arrangement.
Why will our Housing Bank succeed when so many
others have failed?
Other “destination communities” such as Nantucket, Martha’s
Vineyards, Aspen, and others waited until too late to implement solutions
and often those solutions are viewed as failures. Sometimes these solutions
have failed and sometimes it is difficult to judge their success. We can
only hope to learn what we can from their experience. Since we are not
yet in the desperate situation that many of these communities find themselves
in, we believe that there is a window of opportunity for us to
solve the problem. However, even waiting two or three years,
with housing and land appreciating at 15+% per year, may place us in the
“too late” category.
Isn’t restrictive zoning the real problem?
While it may also appear that the supply of property could be increased
by widespread rezoning to encourage a rapid increase in density county
wide, islanders have consistently expressed concerns about the prospect
of rapid growth that such a density increases would imply. There are also
serious concerns emerging about water availability, and concerns about
the impact on real estate and sales taxes to provide the additional investments
in public infrastructure that accompany such growth. Our community has
become very polarized on this issue and solutions are now not easy. This
is a growth issue and we have not taken a pro-growth or anti-growth position.
Our attention has been focused on assuring that, whatever our population,
that our working families can afford to live in our community. This will
require some compromises on zoning since land prices are already too high
for working families. Increased density is the only way to reduce the
cost of land to the homeowner. One approach that we think might have promise
is density exchange where a project might benefit from dense zoning that
is not being used in one area in exchange for increased density in another.
Won’t the Housing Bank stimulate undesirable
growth?
Some fear that affordable housing will attract more people to the islands.
Realistically speaking, this is unlikely to happen if we are careful how
we accept applications for the housing that the Housing Bank makes available.
The ordinance creating the Housing Bank addresses a minimum set of criteria
for qualification and the Housing Bank Commission can elect to further
restrict who can purchase these homes.
Doesn’t affordable housing reduce neighboring
property values?
There have been a number of studies done showing that affordable housing
has no effect on neighboring property values, but some still remain unconvinced.
A problem of the past has been the funding restrictions that concentrated
low and very low income housing. We believe that any approach that tends
to stratify our community, by income or otherwise, is a bad approach.
Rather, by addressing the full spectrum of need including moderate and
middle income, we can implement mixed income communities. This benefits
us in many ways including opening beneficial approaches to financing and
builds healthier communities.
Isn’t the crime rate higher in affordable
housing developments?
One of the concerns about the Housing Bank that we have received is the
fear that crime is a serious problem in affordable housing developments.
There have been a number of national studies done to refute this concern,
but perhaps we should look closer to home. We asked Sheriff Bill Cumming,
“Is this a problem in San Juan County, specifically in permanently
affordable housing developments like that provided by OPAL and other
community land trusts?” His response was, “I don't believe
there is any discernible difference in the incidents here in San Juan
County referencing community land trusts and a elevated rate of crime.”