Studies on Housing Part I: Demystifying Affordable Housing
STUDIES ON HOUSING PART I:
DEMYSTIFYING AFFORDABLE HOUSING
HOSTED BY DESIGN DIALOGUES • JUNE 2021
As part of the “A Call for Change” initiative and stemming from the past year’s discussions with Dr. Sharon Egretta Sutton and JMBC Director Shawn Rickenbacker, the Davis Brody Bond / Spacesmith Design Dialogues Committee initiated a three-part series titled “Studies on Housing” that focuses on housing and the issues of social and spatial justice. The study dives further into topics such as the federal laws and policies that have shaped housing, the role of architecture in its development, the state of housing today, and some creative ideas going forward. The first of the series, "Demystifying Affordable Housing,” begins to dive deeper into the definition of “affordable housing” and all its nuances, as well as look at specific NYC policies and programs, and ends with a history of public housing and key takeaways.
Demystifying Affordable Housing in New York City
To understand how affordable housing works, we first must know what affordable housing means and which entities regulate the policies around it. There are three levels of government that play a role in affordable housing regulations:
On the Federal level: HUD (Department of Housing and Urban Development)
On the State level: DHCR (Division of Housing and Community Renewal) and HFA (Housing Finance Agency)
On the City level: NYCHA ( New York City Housing Authority), HPD (Development of Housing Preservation and Development) and DCP (Department of City Planning)
These are the entities that define and dictate the affordable housing guidelines and all its requirements in the United States. Over the years, regulations and strategies to fund affordable housing have changed. Starting in the 1930s, the government built, owned, and maintained the housing itself. We usually refer to this type of housing as “public housing.” Much of it still exists, but the government hasn’t built any more of it since 1974. In the 1970s, the government started giving subsidies to families to find their own housing from private landlords. These are the “section 8” vouchers. Today, Public Housing and Section 8 Programs are stagnant, and programs are directed to private investors and developers. The government uses tax incentives, low-interest loans, and other means to encourage developers to include affordable housing in their projects. For example, the option of building a higher number of units or more square footage. Some of these programs involve a lottery process, in which families can apply for those apartments, as long as they are eligible. The apartments are designated to different income categories, so one must be in the correct category to be able to apply.
In order to identify who is eligible to apply to which program and category, it is important to analyze some of the definitions established by the entities mentioned above. Affordable Housing is housing that families in certain income categories can occupy for 30% or less of their income. Families, according to HUD, is a group of people who live in a house or apartment and are related to each other by birth, marriage, or adoption. NYCHA on the other hand, has a broader definition, which also includes people living alone or people connected by domestic partnership, guardianship, court-appointed custody, or a “cohesive sharing relationship.” As for the Income Categories, HUD defines them based on the Area Median Income (AMI) of a specific area as shown in the graphics below. Different affordable housing programs target different income categories. For example, public housing is intended for “low income” and less, while Section 8 is intended for “very low income” and less.
Affordable Housing Definition
The most important factor and what separates affordable housing from market regulated housing is that “the family has to spend 30% or less of their income in housing” for the government to consider it affordable housing or what is known as affordable rent burden. Which in theory sounds very good, but we do have to keep in mind, that obviously 30% of a yearly income of $1 million is not the same as 30% of a yearly income of $20,000.
Are Median Income (AMI) Definition
The income categories are established according to the AREA MEDIAN INCOME of a specific area. This is the income earned by the family right in the middle of the income distribution in a given area, it is not the average income of an area, and it is defined every year by the US Department of Housing and Urban Development (HUD), according to income data from the American Community Survey, the Census.
Area Median Income (AMI) Chart
The bottom line of the graphic represents the total number of families in a given area, to the right we have exactly 50% of families earning more than the AMI and to the left, 50% of the families earning less than the AMI. The number right in the middle is the one that will dictate the AMI for that specific area and year. That will be then, 100% of the AMI. If a family earns 80% or LESS than the AMI, it is considered to be in the LOW INCOME CATEGORY. These families need to spend 30% or less of their TOTAL (100%) income in housing so that said housing is considered affordable.
By the definition in the graphics shown above, a dwelling is considered "affordable" for low-income families if it costs less than 24% of the Area Median Income. In some places the AMI misrepresents reality; for example, in high-income areas (like NYC or Washington DC), the median income is around $100,000, which means that a family of three with an income of $40,000 is considered “low income” for housing affordability purposes. That means a unit could qualify as affordable for a low-income family while still being way outside the price range that a family living near the poverty line can afford.
The fact that many high-income households live in Manhattan or the Washington, DC area does not magically make mid-priced houses affordable to the city’s actual low-income residents. By basing affordability metrics on the local median income, AMI implies that when housing affordability gets so expensive that lower income people leave the area, your city has increased the affordability of its housing stock. Since the highest income metro areas in the States are often the least affordable, this is a great distortion.
2020 AMI Numbers: National v. Local
For the state and for the city show the AMI being much higher in the city than in the state and Country. This is what usually happens in most urban areas.
Six Steps to Affordable Housing
(1) go to the HPD site and find the chart number; (2) find the family size, for example, a family of three; (3) find the household income, for example 82,000 a year; (4) go up the column and check the AMI, in this case 80%; (5) go to the next chart # and see the categories. As we saw before, less than 80% of the Area Median Income is considered Low Income. Therefore, this family can apply to units intended for the LOW INCOME CATEGORY; (6) Finally, find chart # and see under the 80% AMI column, that (for example) for a 2 bedroom apartment they should be spending $1,878.
Currently the most used system to distribute affordable housing in New York City is a lottery, through which eligible families or individuals can apply to different affordable housing options. The graphic above depicts the necessary steps to be taken for a family of three applying to the program. After creating a profile of the household and its members and income on the HPD website, they will be able to see the available apartments.
NYC Areas Most Affected by Housing Concerns
The map on the left shows the percentage of people under NYC poverty line, highlighted in red and dark orange. The middle map shows the same areas in dark orange for rent burden. Rent burden is when more than 30% of the household income is spent on housing. Sometimes rent burden can lead to eviction, shown in the map on the right. Comparing the three maps we conclude that it’s usually the same areas and communities that are affected.
The lottery system provides an equal opportunity for people that apply to it, but the affordable housing available options are usually not sufficient to cover the demand. Numbers indicate that the lower income categories have the highest number of applications. This results in fewer chances for every applicant to get an affordable apartment. Sometimes apartments have over 1,100 eligible applications, and only one application will win the lottery, which means 1,099 families will continue to be under rent burden.
— Maia Muniz Moreno
New York City Specifics
Over the past twenty years, the population of New York City has grown by over one million people, from approximately 7.4 million in 1999 to 8.4 million in 2019. With rent continuing to increase, wages stagnating, and more people competing for housing, the city has found itself with a shortage of affordable housing, with over half of residents rent-burdened (paying over 30% of income for rent) or severely rent-burdened (paying over 50% of income for rent).
Data published by the Rent Guidelines Board’s NYC Housing Supply Report over this same 20-year period of population increase has shown that new housing stock has trended towards non-regulated market-rate housing, which is exacerbating the problem.
In addition, hundreds of thousands of people are on the waiting list for public housing, and lotteries for private affordable units draw a large number of applicants. For example, there were more than 80,000 applications for 38 affordable units for a project in Williamsburg. Recognizing this as an affordable housing crisis, city officials developed plans and policies that attempt to change the trajectory of affordable housing. Two policies that have developed recently, but in a timeframe that allows further analysis, are the Housing New York Plan and the Mandatory Inclusionary Housing program.
Housing New York: A Five-Borough, Ten-Year Plan, was implemented in 2014 under Mayor de Blasio to create and preserve 20,000 affordable homes per year, or a total of 200,000 homes over a ten-year period. In 2017, recognizing the progress that was being made, the Administration further committed to completing the initial goal of 200,000 home two years ahead of schedule, and increased the goal to an additional 100,000 homes by 2026. In addition to the metrics, the key goals of the plan include: (1) fostering diverse, livable neighborhoods; (2) preserving the affordability and quality of the existing housing stock; (3) building new affordable housing for all New Yorkers; (4) promoting homeless, senior, supportive, and accessible housing; and (5) refining City financing tools and expanding funding sources for affordable housing.
As of 2020, in the six years since the initiation of the housing plan, the city has built over half of its goal of 300,000 affordable homes, and with another six years to go, it is anticipated that the full goal will be met. On a surface level, this data suggests that the plan is starting to solve the housing crisis by increasing the quantity of affordable housing to the housing stock; however, not all has been positive. Critics have argued that the Housing New York Plan should focus less on moderate and middle-income households and provide as much lower income affordable housing as possible for those who are really in need of assistance. The plan has also been criticized for ignoring the disparities of race: city-wide, the median white household earns around $80,000, which a black household earns $43,000, and a Latino household earns under $38,000, with affordable housing limits set regardless of these racial economic inequalities.
The Mandatory Inclusionary Housing program (MIH) was initiated in 2016 as a part of the Housing New York Plan and was developed in close consultation with the Department of Housing Preservation and Development. The Department of City Planning launched MIH as a zoning tool which requires developers to include affordable housing in projects that are rezoned to allow for more housing development. Prior to MIH, the city only had a voluntary inclusionary housing program (VIH) that provided density bonuses in return for new construction, sustainable rehabilitation, or preservation of permanently affordable housing, however, this program was optional in nature. The central goals of MIH are to: (1) create more economically diverse communities across NYC; (2) ensure that a share of new housing in growing communities is affordable; and (3) reach lower incomes and maintain flexibility.
MIH is applicable under two scenarios. The first is when a developer wants to build a larger residential building, expand an existing residential building, or convert a non-residential building to apartments, but is not permitted under the current zoning. An application for rezoning can be undertaken, however, if the project will include the creation of more than 10 units or more than 12,500 sf of floor area, then the rules of MIH apply. The second is when a neighborhood rezoning is undertaken by a city agency like the Department of City Planning. If the rezoning allows for a "significant" increase in permitted residential floor area that can be utilized by future owners and developers — with DCP determining what is considered "significant" — then the rules of MIH apply.
There are two main options, with the other two options (the Workforce Option and the Deep Affordability Option) being applicable only when in conjunction with the other two options. In addition, even distribution is required across all projects, and it is the City Council that chooses the appropriate option during their vote on the rezoning of a project.
MIH’s core goal is to increase the available affordable housing stock in the city; however, as of January 2020, only 2,065 MIH affordable dwellings had been approved, with most of these receiving heavy public subsidies and concentrated in low-income areas. MIH also only applies to rezoning projects, so developers can keep the zoning that they have and decline to participate in MIH in order to maximize market-rate housing. The program reflects a fundamental failure due to restrictions that have limited the use of public subsidies and tied the policy to rezonings in the city’s less affluent communities rather than its strongest housing markets. “The system we have allows mainly rich, white neighborhoods to opt out of things, and to say ‘we don’t want that,’ but forces Black, brown and immigrant neighborhoods to take these things on,” said Barika Williams, the executive director of the Association for Neighborhood and Housing Development, to the NY Times. The Manhattan Institute also reported with an analysis of MIH and one suggestion is to “rezone larger manufacturing-zoned areas in strong housing-market areas” so that MIH can be used as a tool without requiring subsidies.
One of the key takeaways from this study is that although admirable in nature, policies and programs sometimes have unintended consequences. To truly create healthy and thriving cities for all citizens and not only the few privileged ones, we as a society must continue to analyze these policies at a deeper level than just metrics and look both broadly and specially at how the policies shape people’s lives.
— Daisy Houang
Credits & References
https://rentguidelinesboard.cityofnewyork.us/wp-content/uploads/2020/05/2020-HSR.pdf
https://anhd.org/report/how-affordable-housing-threatened-your-neighborhood-2020
https://www1.nyc.gov/assets/housing/downloads/pdf/housing_plan.pdf
https://council.nyc.gov/land-use/plans/mih-zqa/mih/
https://www1.nyc.gov/assets/planning/download/pdf/plans-studies/mih/mih_report.pdf
https://www.nytimes.com/2020/12/10/realestate/housing-plan-new-york-mayor.html
https://www.manhattan-institute.org/deblasios-mandatory-inclusionary-housing-program
A (Very) Brief History of Public Housing
American architecture from World War I on was influenced by the work and theories of a group of European architects. The work of these architects became known as “The International Style.” International Style architects came to the United States and made extraordinary contributions. Mies van der Rohe, for instance, emigrated to Chicago and designed some of the most elegant buildings and houses in the twentieth century. Yet some of the work addressing urban design is now considered flawed and had a profound and detrimental influence on projects in this country, particularly on high-density subsidized housing.
Le Corbusier was the most influential architect in promoting urban design theories for housing. He equated his housing design theories with social reform. He was passionate about “lifting” housing into the sky where people could enjoy fresh air and views and be separated from industry. His obsession with order and geometry could be called fanatical. He famously noted that “the city of today is dying because it is not geometrical.” He was convinced that housing as huge, orderly skyscrapers, lifted off what he called the “filth” of Paris streets, would result in “salvation for the planet.” The best-known example of his philosophy was La Ville Radieuse (The Radiant City). Intended as a mega housing project for Paris, this project was meant to be a catalyst for social reform.
La Ville Radieuse (The Radiant City), Le Corbusier, 1935
La Ville Radieuse (The Radiant City), Le Corbusier, 1935
A lot of this polemic was later adopted in New York, where a housing boom occurred beginning after World War I. Fiorello LaGuardia, the New York City Mayor from 1933-45, built a lot of what became known as the “the projects.” His heart was in the right place: he recognized a need for change from the unhealthy environment of tenement housing and in 1934 founded the New York City Housing Authority (NYCHA), whose mission was “the clearance, replanning and reconstruction of the slum districts of New York.” The result of this were huge projects, inspired by the theories of Le Corbusier, consisting of multiple towers in geometric configurations that were lifted off the streets.
Other planning councils across America adopted these ideas for subsidized housing. Why? It was formulaic, an easy solution to the burst in population growth after World War II. One of the most notorius examples of this concept were The Pruitt Igo towers, designed by Minoru Yamasaki in 1954. Consisting of 2,970 apartments on a 57-acre site, the project was financed by the Housing Act of 1949. Yamasaki’s original design consisted of a people-centric mixed-rise complex, but the Public Housing Administration rejected the plan as too expensive. The result was a series of eleven-story towers of poor-quality construction which became apparent soon after its first residents took occupancy. The complex isolated people, and this lack of connection promoted crime. These issues dovetailed with the trend of “white flight” — white people leaving the city for the suburbs — and left behind people who were poor. Occupancy dwindled to only 600, and the towers were demolished less than twenty years later.
Pruit-Igoe Towers, St. Louis, MO. Eleven-story, 33-tower affordable housing designed by Minoru Yamasaki in 1954
Pruit-Igoe Towers demolition, 1974
What happened at Pruitt Igo was happening in New York City, where high rise housing towers substituted theory over people, destroying neighborhoods in the process. Enter Jane Jacobs, a Canadian urban planner who through writing and activism would change the way we looked at cities and housing. Jacobs observed that these housing models were flawed; taking away street presence and connections between people destroyed neighborhoods and, eventually, cities. She referenced the misguided thinking that resulted in housing projects like Pruitt Igo, which substituted abstract theory for people’s needs. “There is no logic that can be superimposed on the city; people make it, and it is to them, not buildings, that we must fit our plans,” Jacobs wrote.
One of the few architectural firms who understood Jacobs, and who looked at government-subsidized housing as an opportunity, was Davis Brody Bond (then Davis, Brody & Associates). Their work dovetailed with new city ordinances that now allowed private developers to work with architects. Davis Brody formed a very successful relationship with developers such as Richard Ravitch; and housing projects in New York City started to look thoughtful and elegant. One of their most successful projects was Riverbend Housing.
Located at 139th Street and Fifth Avenue, the apartment complex of 624 residents broke the stereotype of “subsidized” and “luxury” and introduced elements into the project that had not occurred before. Duplex apartments with front porches, courtyards that could be seen from the units, and commercial elements at street level put the “neighborhood” back into high-rise housing. Their work was a turning point in housing design, and resulted in beautiful architecture that focused on the needs of its residents. Their work is best described by the most influential architectural critic at the time, Ada Louis Huxtable: “a human esthetic and environment fusion that has been notably lacking in New York. There should be penalties for architects who do less.”
— Elisabeth Post-Marner