A lack of capital investment and low-barrier properties continue to thwart efforts to increase affordable housing in Austin, according to a panel hosted by the Real Estate Council of Austin on Tuesday.
Ann Howard, executive director of the local nonprofit Ending Community Homelessness Coalition, served as moderator.
“When we talk about affordable housing for the homeless, it needs to be not only affordable but also low-barrier,” Howard said to the crowd of local real estate professionals.
Barriers include not only the rising cost of housing but also a lack of support and “the baggage they are bringing with them,” she said, such as broken relationships, a criminal history that limits job prospects and income and substance addiction.
Howard also discussed affordability as applying to two camps.
There is a distinction made between families that earn 30 to 60 percent of the median family income, which in Austin is $81,400 for four people, according to the most recent data collected by the U.S. Department of Housing and Urban Development. That means the family earns between $24,420 and $48,840.
The other category of affordability applies to families earning up to 120 percent of the median family income, or around $98,000 a year.
In July, the average cost of a single-family home in Austin was $397,689, according to Realty Austin. This represents a 9.5-percent increased over last year’s average.
In our own backyard
Walter Moreau, executive director of the local affordable housing nonprofit Foundation Communities and a panelist, said another barrier is nimbyist attitudes.
“Are we providing housing for those people?” he said is a common refrain from residents who are concerned about affordable housing initiatives.
“I suspect everyone in this room knows those people,” Moreau said, “knows somebody who needs affordable housing.”
David Steinwedell, another panelist and founder of the private equity fund Affordable Central Texas, which preserves affordable housing, agreed with Moreau.
“Affordability is found across a whole spectrum of folks,” Steinwedell said, including teachers and firefighters and other essential contributors to the community.
Sarah Andre, a panelist who works for the affordable housing financial firm Structure Development, added that she knows college graduates in Austin who cannot afford a home in Austin because of rising property values.
With such a broad demographic of people who qualify for affordable housing in Austin—from the highly educated middle class to individuals experiencing homelessness—the search for a solution is urgent and complicated.
“The one biggest challenge to building affordable housing is that it’s capital-intensive,” Moreau said. “There’s no secret that makes it cheaper” than building market-rate properties.
Andre suggested that one way to facilitate the building of more affordable properties would be to streamline the city’s development review process, which is lengthy and costly.
The panel also discussed the value of alternatives to single-family homes, such as condos and duplexes. In the face of Austin’s rapidly increasing property values, home ownership becomes impossible for many Austin residents, including young families.
“I don’t think millennials have given up on the dream of a suburban home with a yard and a dog,” Steinwedell said. “But I don’t know how millennials can buy a house in Westlake.”
“I think the demand is there,” Andre agreed. “It’s just not attainable.”
Affordability in the wake of Harvey
The city of Austin counted 2,036 people experiencing homelessness on January 28 as part of the Point in Time Count required by HUD for communities receiving department funds.
This represents a 28 percent reduction from 2016, an encouraging sign.
However, extenuating factors, such as Hurricane Harvey, can stall this progress.
“Now in Texas, there is a lot less housing,” Howard said. “HUD warns me that every storm like this creates homelessness.”
As recovery efforts continue to the south and east, Austin may find itself the recipient of low-income and homeless residents of the afflicted areas searching for a new, affordable home, she said.