Forum partners welcome HUD training

Boise City Council member Lisa Sanchez welcomed a roomful of housing providers, city and state staff, and local nonprofits on April 26 to a fair housing workshop presented by the Department of Housing and Urban Development (HUD). Attendance was estimated at well over 200, with in-person and individuals watching via webcast throughout Idaho. This is the last workshop during April, where many different groups recognized the 50th Anniversary of the signing of the Fair Housing Act.


Featured presenter: HUD’s Kristina Miller, Office of Fair Housing and Equal Opportunity

HUD’s Deputy Northwest Regional Administrator Michael Look kicked off the day by thanking attendees for their time and interest before outlining the history and meaning of the Fair Housing Act, its roots in the U.S. Constitution, and acknowledging those who made it possible. He introduced HUD’s last remaining Idaho field office representative, Senior Management Analyst Brian Dale

HUD reps Kristina Miller, Brian Dale, and Michael Look

Mr. Look emphasized that the economic opportunities made possible through housing choice and mobility go beyond the typical civil rights focus of fair housing. Where we live determines our access to essential community services, social capital and basic amenities. He acknowledged the rights and challenges of housing providers, and his hope that through ongoing training and greater awareness, they could all take steps to avoid violations and associated costs.*

Kristina Miller with the Seattle Office of Fair Housing and Equal Opportunity conducted the day’s training, starting with an overview of fair housing basics, protected classes, prohibited actions , disparate impact and the three-step analysis of policies or practices to determine compliance. She also outlined seven fair housing design and construction standards, and the importance of accommodating our aging population—which applies to everyone.

The main point of fair housing is ‘equal access’ for all.

She also touched on recent HUD guidance on criminal history; that is, if the property involved is covered under the Fair Housing Act, they must maintain and follow a clear criminal background policy that otherwise treats all protected classes the same consideration. A *three-step analysis determines whether a policy has discriminatory effect:

  1. Does the policy result in a discriminatory effect on members of a protected class?
  2. Does the policy achieve a specific, legitimate nondisriminatory interest to the provider?
  3. If yes to #2, is there a less discriminatory alternative to achieve the same effect?

Unjustifiable policies

  • A blanket ban on criminal activity or an arrest record; unless there is a conviction, anyone could be banned without legitimate cause, thus it would be unjustifiable.
  • A blanket ban on all convictions that fails to differentiate between a legitimate threat to life, safety or property or no threat may also be unjustifiable.

View or download the presentation as a .pdf — Fair-Housing-Act-for-4-26-18-presentations

Check back for links to the webcast version.

Everyone wants a bag like Brian’s vintage FHF tote! We’ll get some made and let you how to get yours.

Housing Market Disruptors Undermine Fair Housing Gains, Economic Stability

“Dreaming of Home’ – Hannah Wilson, Borah H.S. 1st Place, 2009 Idaho Fair Housing Calendar Contest

Note: the following is a distillation of multiple presentations from 2016 to the present. It is intended to provide context for discussion, not to imply judgement or assign blame.

Healthy and diverse housing markets create stability and prosperity

An essential principle of the Fair Housing Act is the concept of ‘housing choice,’ the right of all persons to live where we choose and can afford. Where we live determines access to essential community amenities: good schools, diverse employment options, quality health care, and government services. In addition, we know the health and prosperity of children and families are impacted by air and water quality, fresh produce, transportation and recreation options. Equally important are opportunities to build strong social capital, defined as the networks of relationships among people who live and work in a particular society, enabling that society to function effectively.

Taken together, these factors support and expand economic opportunity and financial stability for more Americans, while reducing the social costs of poverty for all taxpayers. Housing affordability is achieved in one of two ways: by raising local wages so a full-time worker can afford to live near the workplace, or keeping housing costs within reach of existing local wages and incomes. In other words, housing types and prices that reflect local needs and incomes represent a perpetual wage subsidy to local employers. Conversely, when wages and housing costs are in balance, this means a higher percentage of household incomes circulates in the local economy and reduces demand for social programs over the long term.

Think of a local economy or housing market as an ecosystem—a complex and interconnected community of diverse residents and interests. Every community needs a range of skills and services to function—educators; service, retail and hospitality workers; building construction and maintenance professionals; health and personal caregivers; etc. These individuals make our communities livable and functional.

Photo credit: E. Kingston

When the housing ecosystem is out of balance, we inevitably see ripple effects in poverty, evictions, homelessness, despair, substance and domestic abuse, illness, and crime. This leads to increased social and health costs, lost opportunities, unemployment and social unrest.

“Even if we remove civil rights from the fair housing equation, the argument for housing choice as an economic stabilizer is compelling.” —E. Kingston

Strategies that create or preserve local housing affordability reflect what Alexis de Tocqueville described as ‘self-interest, rightly understood.’ It’s the equivalent of fixing your community’s hospital roof before it rains, helping out with a barn-raising or passing a levy to build a wastewater treatment plant or flood control system.

Affordability is key to a sustainable market

Affordability is important to the real estate industry as well. Windermere Economist Matthew Gardner cautioned a Boise audience that, “Loss of affordability can stop a market in its tracks.” (JUMP, 10.10.17) During the run up to the last housing bubble, the proliferation of new REALTORS®, house flippers and speculative investors were a warning sign. “House flipping shows,” Gardner pointed out, “are precursors to a bubble.” Indeed, a National Bureau of Economic Research analysis of the housing market crash implicates flippers and speculative investors, not subprime borrowers as was widely assumed. In some markets, agents outnumbered listings

When the bubble burst, homeowners and many others saw their credit ruined, which eliminated them as potential home buyers for a prolonged period. This left many REALTORS® not only without a client base, but underwater on multiple properties of their own.

Just as fishing industry professionals know the the value of preserving fisheries, REALTORS® would do well to support diverse and healthy ‘housing ecosystems.’ First, to ensure the next generation of credit-worthy home buyers is on deck, and second, to offer diverse options for existing home owners to downsize or move, knowing they have choices. The current overheated market is effectively locked up, with home owners reluctant to give up their current homes and new home production hampered by labor shortages and high construction costs.

“Housing is for living in, not for speculation” —Xi Jinping

With ‘commodification,’ it’s about supply and demand

When housing is treated as a commodity and industry profits are indexed to sales price, there is little incentive to preserve housing for families, retirees or a stable workforce. At the government level, local taxing authorities see only the increased revenue, and capital investment or private development interests can take precedence over local residents, livability, and workforce development. In areas driven by a narrow focus on growth at all costs, potential residents are courted, while long-term existing residents are simply taxed.

The Sightline Institute has created a straighforward way to visualize the supply and demand imbalance as a ‘cruel game of musical chairs.’ The analogy is summed up pretty clearly: In the game of musical chairs, you need to be fast; in the game of housing, you just need to be rich.

“Investing in a commodity is different from being invested in a community.” —E. Kingston

The primary focus becomes the financialization of housing, as seen in the period leading to the last recession. A 2017 U.N. report on ‘Foreign Investment in Housing‘ describes a new emphasis on “…structural changes in housing and financial markets and global investment, whereby housing is treated as a commodity, a means of accumulating wealth and often as security for financial instruments that are traded and sold on global markets.”

The report outlines several net outcomes of  commodification (paraphrased below):

Undermines democratic governance and community integrity

  • Credit agencies trump human rights
  • Remote control of housing use, cost, location or existence
  • Real estate industry plays central role in government and policy

Exacerbates inequality and social exclusion

  • Encourages gentrification
  • Displaces marginalized populations

Detaches housing from community, human dignity & security

  • Increases wealth and income disparity
  • Housing as a speculative commodity becomes dehumanized
  • Outside investors detached from local residents or housing needs
  • Remote ownership lacks accountability

Supply

Several factors currently threaten the stability of our housing supply:

  • First, global investors view North American real estate as a means to offshore, launder and/or store wealth. According to the 2017 U.N. report referenced above, this ‘new colonialism’ creates “…greater income inequality, spatial segregation, inadequate housing provision and growing homeless populations.” This has given rise to ‘ghost apartments‘ in major coastal cities.
  • Second, this ‘primary market’ inflation magnifies gentrification and segregation, then spills over into secondary markets (like Idaho), where it displaces locals who live and work in those communities. Speculative investment and the commodification of housing leaves behind those without the financial ability to compete against multiple cash offers over asking price.
  • Third, purchase and conversion of legacy multifamily properties push rents up and tenants out, while conversions of traditional residential housing to short-term rentals is creating ghost neighborhoods and further shrinking rental supply—pricing locals and millennials out of housing markets. Institutional investors play a large role in conversions—with devastating impacts on working families—as detailed in this 2007 Reveal podcast, After the bubble burst, featuring an investigation of key players. This problem was further highlighted by Fannie Mae in its 2016 report, Many Starter Homes Have Shifted from Owner Occupancy to Rentals.
  • Finally, federal funds that stabilize families, neighborhoods and communities are at risk in a time of widespread poverty and nearly $4 trillion in consumer debt—a 45% increase since 2008.

All this has a profound impact on housing supply and demand and drives prices up. The U.S. rental vacancy rate is at near-record lows relative to demand, with 1.89M fewer vacant rentals than during the fourth quarter of 2009, while the number of households has increased by 9M in the same period.* High costs of land and new construction mean we can’t simply build our way out of the current crisis, so the way forward will require a number of strategies to preserve affordability and inventory, increase capacity and make efficient use of limited land and resources. *Source. American Fact Finder

Consumer debt skyrocketing

On the tenant side of the equation, debt and poverty create barriers to housing choice. As housing cost burdens have increased, tenants have seen credit card, student loan and autuo debt increase by 45%. After the recession and crash, big investors fueled the problem. Some bought up tens of thousands of distressed properties at pennies on the dollar, then rented them at highly inflated prices with onerous fees and penalties designed to result in eviction and court appearances, where tenants almost always lose. One such company was Colony Starwood Homes, featured in Profiting off Pain.

Evictions have emerged as a business model and driver of poverty. Pulitzer Prize-winning author and McArthur Fellow Matthew Desmond documented the business and consequences of eviction in Evicted: Poverty and Profit in the American City. The Pulitzer Prize citation read, “For a deeply researched exposé that showed how mass evictions after the 2008 economic crash were less a consequence than a cause of poverty.” Despite—or perhaps in response to—growing awareness of this issue, some landlord associations want to make it even easier to evict tenants.

Poverty

Poverty is on the rise in many U.S. cities, and Boise is no exception, with 7.1% of Boise residents living in high poverty neighborhoods compared to just 2.4% in 2010. At the national level, many Amercans walk a financial tightrope each month; 50% of us couldn’t come up with $400 for an emergency expense. Read more on the topic here.

At the end of the day…the persistence of extreme poverty is a choice made by those in power —Philip Alston

Moving forward

With housing costs approaching all-time highs in many U.S. markets, the Fed move to raise interest rates could have a significant impact. Mortgage rates have been in the range of 3%, which allows buyers and sellers to rationalize higher purchase prices. Interest rates are on the rise in response to the rising U.S. deficit; this means Americans or Idahoans without a few hundred thousand dollars to use in a cash bidding war will face higher monthly costs or choose not to purchase.

What can be done to slow the loss of legacy residential infrastructure? How do we build housing that is affordable when the cost of construction is not? And who bears responsibility for these challenges? If this were easy, we’d have figured it out. In general, some concepts to keep in mind can help guide local discussions.

We all bear responsibility for creating solutions, just as we all bear the costs of gentrification, segregation and homelessness. Low-income individuals and families are simply not a primary target market for private developers, and they lack political influence. Those who understand the value of housing affordability must step up to the plate to put this issue on the radar.

Thanks to Dan Bertolet, Sightline Institute

It’s not practical for housing advocates and enlightened taxpayers to expect private developers to build housing they will lose money on—especially when they face NIMBY pushback from neighbors. As Boise’s mayor sums it up, the only thing citizens hate more than sprawl is density. Without political will, taxpayer support or long-range strategies, government is unlikely to address the problem.

And remember:

  • A resort community without diverse, locally controlled housing is just a resort
  • A functioning local community and economy create lasting value and attract investment
  • Diverse and distributed housing infrastructure yields multiple benefits: social, cultural economic, environmental, employment, etc.
  • Housing stability supports social capital; social capital supports independence

— Erik Kingston, PCED 4.17.18


Below are selected news stories that illustrate the complex challenges facing today’s housing markets. Check back for updates.

Additional resources

Idaho Observes the 50th Anniversary of the Fair Housing Act

Image result for 50th anniversary, fair housing

During Fair Housing Month (April), Idaho stakeholders can take advantage of several scheduled fair housing events to commemorate the 50th anniversary of the signing of the Fair Housing Act. Events are listed below in chronological order:

 

Still time to register for HUD Workshop!

What Fair Housing Celebration & Workshop / HUD

When Thursday, April 26th, 8:30 am to 4 pm—

Where Boise City Hall, 150 N. Capitol Blvd, 3rd Floor

Registration and information here

 

What Idaho Apartment Association Fair Housing Event

When Wednesday, April 11th

Where Boise Centre East. 4th Floor

Help us celebrate 50 years of the Fair Housing Act of 1968! Renew your commitment to the importance of providing equal housing opportunity for all. Join 500 industry professionals as we learn, network and celebrate!

Register


What IFHC’s Vision Summit

When Wednesday, April 18th

Where Boise Centre East, 4th Floor

Register

Join us as we learn together and embody our vision for the future of housing! Featuring workshops and panels on housing, access and intersectionality. All are welcome and encouraged to attend!

Three Focal Tracks:
—Disability Rights
—Abundant Housing
—From Rights to Reality

Idaho Transportation Draft Plan Public Open Houses

Idaho Transportation Department

You are invited to review the draft Idaho Transportation Plan and share ideas that will help shape your community and future developments. See more details here.

Each of the Idaho Transportation Department’s six districts will feature an open house to review the DRAFT version of the statewide Public Transportation Plan. This plan address public transportation in Idaho and sets goals and strategies for the next five years for the Idaho Transportation Department’s Public Transportation Office as well as the public transportation providers.

Contact: 208-334-8822 or *protected email*

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