Study Finds Home Owner Racial Gap
Finding policies to promote upward economic mobility through education and job training could be a more significant approach to increasing minority homeownership rates than new types of home loans that have been introduced by the government and housing industry, a recent study by the University of Southern California’s Lusk Center for Real Estate suggests. The study found that the homeownership rate for blacks and Latinos has remained fairly steady at about 50% for the past 18 years, compared to a 75% rate for whites. However, an analysis of data from the Federal Reserve’s Survey of Consumer Finances suggests that one-fifth of Latino renters and 16% of African American renters were saving money for a house in 2001, up from 8.5% and 6.8% respectively in 1983. “It’s a very hopeful sign about future improvements in homeownership rates,” said Gabriel Rosenthal of Syracuse University’s Center for Policy Research, who helped analyze the Fed survey data. (www.latimes.com)
Los Angeles Times (3/24/05); Annette Haddad
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Building Green to Save Green
The Charleston, W.Va., Area Alliance is planning this summer to build a house for a low- to moderate-income family that can also serve as a lab for contractors, builders, students and nonprofit groups to learn about energy conservation. The nearly 2,000-square-foot, three-bedroom Eco-Dwell Project home could include countertops covered in ceramic-looking tiles made of sawdust, says architect Thomas Worlledge of McKinley and Architects, and the garage will be built out of blocks made of Syrofoam, slag, bottom ash and polypropylene fibers. Manufactured by Peerless Block in St. Albans, the blocks are used only in mines to seal off airshafts and have not been used before in a building. Worlledge estimates that the home’s owners will spend 30%-50% less on energy costs and 25%-30% less on their water bill. Low- to moderate-income families spend up to 20% of their income on utility bills, says Susie Salisbury, the alliance’s senior vice president, compared to only 4.6% for families with a medium income. (www.wvgazettemail.com)
Charleston Gazette (3/22/05); Jennifer Ginsberg
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Proposed Big Jump in San Diego Building Fees Draws a Big Backlash
Although it was rejected last week by San Diego’s advisory Park and Recreation Board by a 4-to-1 vote, local builders are concerned that a proposal to increase the average park impact fee in urbanized areas by more than six times could still find its way to the city council. On average, per-unit park fees would jump from $3,335 to $20,948, according to Deborah Sharpe, a park and recreation projects officer. Community by community, the amount could vary widely, from three to eight times the current rate. “I was shocked,” said affordable housing developer Michael Galasso. “Obviously, it makes it much more difficult for us to do any type of affordable housing. It throws the economics completely out the window.” Other critics say the increase would make San Diego, already one of the nation’s least affordable housing markets, even costlier. (www.signonsandiego.com)
San Diego Union-Tribune (3/23/05); Emmet Pierce
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West Coast Is Tops for Coffee Shops
With 2.8 coffee shops per 10,000 people, Anchorage, Alaska , has the most coffee outlets in the U.S. per capita; while, with 801, Los Angeles-Long Beach has the greatest number, according to the NPD Group, a market research firm that tracks how Americans eat. Anchorage was followed by Seattle-Bellevue-Everett, with 2.5 shops, and San Francisco with 2.2 for every 10,000 consumers. New York has only one coffee shop per 10,000 people, although it had the fourth-highest number of shops at 525. Coffee shops have been the fastest growing part of the restaurant business, with an annual growth rate of 7% through last September, said Harry Balzer, vice president of NPD Group. Grabbing a cup of coffee is the leading thing Americans do in the morning, and Starbucks, McDonalds and Dunkin Donuts are the three biggest coffee brands, Balzer said. Starbucks, which represents less than 7% of the country’s total coffee consumption, has more than 6,400 stores in the U.S. and plans to open 1,075 more this year. Coffee shops are increasingly drawing teenagers. “This has become one of the places for the after-school hangout,” said Balzer. “I think it’s because they don’t throw them out.” (www.realestatejournal.com)
Wall Street Journal RealEstateJournal (3/23/05); Kristen Gerencher, from Marketwatch
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Massachusetts Towns Are Rethinking In-Law Housing Rules
With the state’s population aging and its housing prices high, a growing number of cities and towns in Massachusetts are loosening up their single-family zoning restrictions against in-law suites or accessory apartments within the house or garage with their own kitchen, bath and separate entrance. The suites have been prohibited because of fears that they will become rentals and lower property values, and have been restricted to the limited number of neighborhoods where multifamily residences are permitted. Restrictions vary widely, and many of the units are being built “on the quiet.” Topsfield, for example, started allowing special permits for in-law suites in 2001, but the permits must be renewed every three years. Marshfield is considering permitting in-law units in new construction. And a number of towns have introduced amnesty programs to waive property tax penalties for illegal in-law units in exchange for home owners allowing the units to be inspected. Massachusetts has the 12th oldest population in the country, with more than 13% of its population over 65, according to a 2004 study by MassINC, a non-partisan Boston think tank, In 20 years, that number will jump to 18%, giving the state the demographics that Florida has today. (www.boston.com)
Boston Globe (3/15/05); Chris Berdik
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Free Parking Is Costly Investment
Just published by the American Planning Association, “The High Cost of Free Parking” by Donald Shoup, an urban planning professor at UCLA, challenges traditional thinking about subsidizing public parking on valuable land that could be used for housing and parks. Shoup contends that curbside parking is too cheap in many cities, and that cities and suburbs require too many parking spaces around malls, apartments and office buildings. When developers are forced to build extra parking, their costs soar and get passed on to consumers. “It raises the cost of housing and, really, everything we buy,” Shoup says. “The cost of parking…is just hidden from us. You pay for it in the cost of dinner (at a restaurant) even if you didn’t drive.” Amit Ghosh, San Francisco’s chief of comprehensive planning, said the city is now considering scrapping its minimum residential parking requirement of one space per unit in residences downtown and in surrounding neighborhoods, especially near mass transit stops. The new guidelines would set a maximum of one-half or three-quarters of a parking spot per unit. “These residential parking spots are subsidized way below what the market would actually bear for them,” Ghosh says. “Almost 16% of city land holdings are street parking spaces.” (www.usatoday.com)
USA Today (3/23/05); Haya El Nasser
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Tightening Market for Apartments Puts Some Lookers in a Bind
In an area that added 22,200 jobs last year, an expansion of 2.3%, and where population growth is expected to lead the nation between 2004 and 2009, apartment hunters in Orlando, Fla., are finding few available rental units. Condo conversions represented one-third of the city’s multifamily sales last year, and even more condo converters are expected to buy apartment complexes this year. Orlando’s multifamily sales totaled a record $1.3 billion last year, and the local apartment market saw the occupancy rate reach 95% for the first time in a decade. Area rents are likely to increase 3%-5% by year-end, and rent concessions are likely to decline or disappear entirely at many apartment properties by mid-year, industry experts say. Nevertheless, few new apartments are on the drawing board. Brokers cite a shortage of land and competition from condo developers. Also, much of the available land can’t be rezoned to multifamily because of school overcrowding issues. M/PF Research out of Texas is forecasting that nearly 4,000 units will be completed in the area this year, but projects demand at 4,750. (www.orlando.bizjournals.com)
Orlando Business Journal (3/21/05); Jill Krueger
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National Eyes on Colton’s Plight
Magician/comedians Penn and Teller have taken an interest in the decade long plight of Colton, Calif., to gain development rights on some of the 500 acres of protected habitat for the endangered Delhi Sand flower loving fly, according to city officials. A segment could be filmed for an upcoming episode of their Showtime series focusing on the extreme, but representatives for the entertainers could not be reached. The city’s tribulations over the inch-and-a-half-long fly, which is known to appear for only a few days of breeding every summer before dying, were featured in Michael Crowley’s “That’s Outrageous!” column in April’s Readers Digest. With the last few years of negotiations with the U.S. Fish and Wildlife Service to strike a balance between development and preservation now stalled, city leaders have been renewing their efforts to get federal decision makers to take a closer look. An estimated 15% of the city is fly habitat. (www.pe.com)
Inland Southern California Press-Enterprise (3/20/05); Paul LaRocco
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Not Just Any Old Portal
Russ Underdahl, founder and CEO of Pinecrest, Inc., a Minneapolis home door manufacturer in business since 1954, says that he has sold his doors to Donald Trump; the Kroc family of McDonald’s restaurant fame; the royal families of Saudi Arabia, Jordan and Great Britain; and renowned golfers and race car drivers. But he is selling doors to more than just celebrities as high-end doors start finding a place in American homes. His doors are handmade in Texas or Mexico, and clients can choose solid wood, stained glass or inset panels of cast aluminum. Unlike doors off the shelf at the hardware store, these often include matching transoms and side lights. Designs in the homemade door market range from intricate, curvy Victorian, to Arts and Crafts, to modern styles reminiscent of Frank Lloyd Wright. Prices typically run into the thousands, and many customers are even using them inside their homes. Door makers say their products add to a home’s value the same way gourmet kitchens, luxurious bathrooms or hardwood floors do. (www.startribune.com)
Minneapolis-St. Paul Star-Tribune (3/19/05); Dee DePass
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Environmentally Sound Building Adds Value
Denny Park Apartments in Seattle is the first project in the nation to receive funding through a five-year, $550 million Green Communities Initiative, which is a partnership of The Enterprise Foundation/Enterprise Social Investment Corp. and the National Resources Defense Council. Denny Park’s developers at the Low Income Housing Institute in Seattle, will be using a series of green building ideas to add value to the project, save on operating expenses and sometimes even cut costs over the usual building techniques. For example, instead of constructing the huge underground tank to hold rain and release it slowly into sewers that the city usually would require, rain hitting the roof will run down gutters into three planters, which will soak up some of it before releasing it into the sewer. The largest planter is 75 feet long and five feet wide, and the solution will cost about $15,000 in piping and landscaping and an extra $50,000 for a 6,000-square-foot metal roof instead of composition shingles, which would add poisonous petrochemicals to the rain runoff. The steel roof should last at least 50 years, compared to 20 years for shingles, helping to offset the extra expense in the long run. (www.housingfinance.com)
Affordable Housing Finance (March 2005); Bendix Anderson
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Paso Tax Illegal, Suit by Builders’ Group Says
The Home Builders Association of the Central Coast has filed a lawsuit against the city of Paso Robles, Calif., for illegally imposing an additional property tax on buyers of new homes in newly established community facility districts. The suit claims that developers would be forced to agree to have the districts to get their projects approved and buyers would have to pay for services offered to the entire city, including police and fire protection, libraries and parks. According to the association, the average home owner in Paso Robles pays $340 in property tax to the city; and the average new home owner, who now pays around $450, would have to pay about $1,100 with the extra tax. The new taxes would increase by at least 2% annually or by the rate of inflation in the consumer price index. “Local government should not impose fees on some property owners to pay for general government services made available to the community at large,” said the association’s attorney, David Lanferman of San Francisco-based Sheppard, Mullin, Richter & Hampton. More than 700 community facility districts exist around the state, but Lanferman said he is unaware of cities that are implementing them like Paso Robles. City officials say it costs about $657 more a year to serve a new home than the city receives from it in revenue. The city will hold a final vote on the districts on April 5. (www.sanluisobispo.com)
San Luis Obispo Tribune (3/18/05); Monika Tjia
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Gas Cost Weighs on Drive to Work
Rising gas prices could persuade some to find homes closer to the places they work, but longer commutes are still a growing national trend, according to Gopal Ahluwalia, staff vice president in research economics at NAHB. “Those in our consumer survey said they don’t mind the longer travel if they can get the type of house they want.” “Higher gas prices have no bearing when you have a wonderful place to live,” said Betty Lou Wagner, who recently bought a new townhouse in a far southwestern suburb of Chicago that requires a 57-mile commute into the city. Real estate analyst Tracy Cross said that people might decide to continue to rent closer in rather than buy farther out in reaction to high gas prices, but he noted that consumers often economize in other ways before altering their housing choices. Analyst Steve Hovany said that people in the Chicago area are starting to cut their commutes by moving to closer-in, infill housing in the suburbs and downtown. “Right now, that inward move is major,” he said. “It’s being driven by older buyers. Commuting doesn’t grow on you. Empty-nesters won’t buy in the middle of nowhere.” (www.chicagotribune.com)
Chicago Tribune (3/21/05); John Handley
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