Going backwards

[GenerationW]

I don't know what's wrong with that. The rich paid market price. The poor paid subsidized price. Do you honestly truly believe they should have equal access to the exact same amenities?

If they're in the same building? Hell yeah!

If the super-rich have a problem with that, they have the means to move, and then the not-quite-as-rich can take their place.

 

[ksun]

If they're in the same building? Hell yeah!

If the super-rich have a problem with that, they have the means to move, and then the not-quite-as-rich can take their place.

in the same building because they are subsidized, which means the cost is paid for by someone else.
also, if few of the rich want to live in that building, the poor wouldn't be able to have a livings space there. The project probably can't go ahead at all. The fact they can live in those building which they can never afford to is only because the rich you hate are paying for it.

if the not-so-rich take all the units, well, that will just become a social housing project.

It would be totally fine it the poor are not allowed to use any of the amenities in the building, because they didn't pay for it! They have a place to live which they can't afford to, just thank God and feel blessed. You can't expect to own everyone rich people do.

 

[GenerationW]

in the same building because they are subsidized, which means the cost is paid for by someone else.
also, if few of the rich want to live in that building, the poor wouldn't be able to have a livings space there. The project probably can't go ahead at all. The fact they can live in those building which they can never afford to is only because the rich you hate are paying for it.

if the not-so-rich take all the units, well, that will just become a social housing project.

What is subsidized housing if not another form of social housing?

Don't want to be a part of that? Then don't live there.

 

[DarnDirtyApe]

It would be totally fine it the poor are not allowed to use any of the amenities in the building, because they didn't pay for it! They have a place to live which they can't afford to, just thank God and feel blessed. You can't expect to own everyone rich people do.

You are so mean! That's not fair. In fact, any member of the public should be able to use the amenities in any building for free. After all, it's not fair that those of us who can't afford to live in a building don't get to use those amenities. Heck, everyone can come hang out in my backyard because it's not fair that some people can't afford a backyard at all. [/sarcasm]

 

[freshcutgrass]

I don't know what's wrong with that. The rich paid market price. The poor paid subsidized price. Do you honestly truly believe they should have equal access to the exact same amenities?

Sort of defeats the entire purpose of mixed-income housing...dunnit?

 

[ksun]

Sort of defeats the entire purpose of mixed-income housing...dunnit?

No it doesn't.
It achieves the purpose of putting the rich and poor in the same building without pretending by doing so rich and poor people are all of a sudden "equal". The rich still shop at neiman Marcus and the poor at sears.

 

[Lenser]

The rich still shop at neiman Marcus and the poor at sears.

No, the poor shop at Dollarama and Walmart. Should I be surprised that you don't grasp that? I guess not.

 

[Silence&Motion]

In my humble opinion, I think subsidized housing units in a high end condo building is not appropriate. Were it not for the incentives, I'm certain that the New York developer wouldn't have included them. Just for a counterpoint, here is an article with a contrarian view on this very case:

http://www.businessinsider.com/in-d...affordable-apartments-with-river-views-2013-8

In Defense Of The 'Poor Door': Why It's Fine For A Luxury Condo Developer To Keep Its Low-Income Units Separate

JOSH BARRO

AUG. 19, 2013, 4:22 PM 22,482 35

Imagine if the federal government abolished food stamps and replaced them with need-based price mandates on supermarkets.

That is, supermarkets would be required to make a percentage of their sales at regulated "affordable" prices to needy families. The regulated prices would often be below cost, so supermarkets would raise prices on everybody else to make up for the loss.

Since we don't want any "classist" dietary divisions, the regulated products would span the range of tastes and prices: if rich people are buying lobster, so must poor people, even if that means the program can feed fewer people overall.

Supermarkets would probably complain about the cost of all this, so the federal government would give them compensating tax breaks.

It would also contain their losses by capping participation in the "affordable food program" and creating a waiting list. Once you got in, you could buy cheap food as long as you want it, but until then you'd be stuck waiting and hungry.

Why make this change? Well, food stamps cost money, but this program would have no direct cost to taxpayers. And while food stamps often lead to poor people buying food from cheap supermarkets in poor neighborhoods, this program would end food segregation, ensuring that people of all economic classes eat similar foods from similar sources.

This idea probably sounds insane to you, because it is. But it's roughly the same as New York City's "inclusionary zoning" strategy for providing affordable housing.

We require and incent developers who build market-rate housing to also sell or rent some units in the same developments at cut-rate prices. The idea is that affordable housing shouldn't just be affordable and livable; it should be substantially similar in location and character to new luxury housing. If rich people are getting brand new apartments overlooking the Hudson River, so should some lucky winners of affordable housing lotteries.

Hence the outrage over the "poor door" at a planned luxury condo project that Extell will build on Manhattan's Upper West Side: market-rate buyers will use one entrance, while tenants in the project's affordable housing component will use another. Affordable apartments will also be on low floors and, unlike many of the market-rate units, they won't face the Hudson River.

Getting mad about the "poor door" is absurd. The only real outrage is that Extell had to build affordable units at all.

New York's housing advocates are right about one very important thing: upzonings are a windfall for landowners and the city should be asking for something in exchange for allowing more development. But what it should be asking for isn't luxury apartments with river views to give out by lottery. It should be asking for cash.

That is: Upzone land so more housing units can be built to meet supply. Let developers decide what to build and what to charge for it based on market forces. Charge developers substantial fees to access those newly-created development rights. Collect full-freight property taxes on new property that gets built. Use tax and fee proceeds to pay for projects of broad use to New Yorkers, including housing subsidies.

Even though they are an artificial creation, it is probably best to think about development rights in New York City as a natural resource. If there's oil under your land, the value of the land is the value of the oil less the cost of extracting it. If you have buildable land, its value is what you can sell a developed property for less the cost of construction. When the city upzones land, it creates value out of thin air; the instinct to demand something from landowners in exchange for this creation is perfectly reasonable.

But windfalls from upzoning are a limited resource: You can charge the developer the value of the windfall, but if you charge more he won't bother to build. And the more you charge in the form of a mandate (such as an affordability mandate that reduces rents generated by a development) the less you can charge in tax.

Let's imagine that the city forces Extell to get rid of the "poor door" and spread the affordable units throughout its new project. Since the affordable units will therefore be on higher floors with better views, Extell will earn a smaller profit. Now, the deal economics are probably so compelling that Extell would build anyway. But all that indicates is that the city could also let Extell proceed with the "poor door" plan and charge them an additional fee, revenues from which could have been used to create more affordable housing elsewhere in the city.

Or, it could simply let Extell build whatever it wants and charge an even larger fee and even more in tax.

The city's choice to impose so many mandates is undermining its tax base. Often, the city awards tax abatements to developers in exchange for building affordable housing. As of 2012, property tax abatements in New York City lead to $2.9 billion in annual lost revenue, about 20% of actual property tax collections in the city. About half of those abatements relate to programs that promote new construction of affordable housing.

That is, even though they are off-budget, New York's inclusionary zoning programs have a very large fiscal cost.

Inclusionary zoning looks like a much worse deal when you realize it's not free. If the city received an extra $10 million to spend on affordable housing, it would be crazy to spend that upgrading the views of existing subsidized tenants rather than helping more people afford more apartments. But that's effectively the choice the city makes by pursuing inclusionary zoning instead of just permitting and taxing market-rate development.

Our country's nutritional support programs recognize that food is a market good and the way you make it affordable is by helping people buy it on the open market even if they have few financial resources. New York would do well to realize that applies to housing, too—and to stop freaking out about the poor door.

The comparison between subsidized housing and food stamps is total BS. This is a planning decision. Whether you want to agree with it or not, urban planners realize that mixed-income neighbourhoods are much, much more functional than income-segregated neighbourhoods. If the "free" market tends toward segregation, planners must use the tools they have available to them to try to correct that.

I'd also like to see some actual evidence supporting the belief that if you just give developers free reign to build as much as they want, that housing prices in wealthy neighbourhoods will actually drop. The very expensive cities of the world also happen to have extremely high densities to begin with. I'm so sick of talking heads/newspaper columnists spouting ECON 101 textbooks like its gospel.

Finally, for all those bitching about subsidized housing and forcing the rich to pay more for things that poor people are getting for a lot cheaper, you must really, really hate taxes. You must feel like fools yourself every time you pay income tax to realize that the poor are getting the exact same social services as you for a much lower price. Damn, the poor have it so well in our society.

 

[Memph]

I think the separate entrance is worse than the no access to amenities. It seems rather dehumanizing to treat lower income people as undesirables like that. There's a big difference between that and charging some sort of membership fee for access to the pool and other amenities.

Now... I'm not sure how important it is to have mixed income buildings, as opposed to just mixed income neighbourhoods. But if there's any advantage to mixed income buildings, have a separate entrance defeats the purpose.

I do generally favour relaxing zoning to allow more development and something along the lines of section 8 vouchers over public housing projects and inclusionary zoning though.

 

[Memph]

I'd also like to see some actual evidence supporting the belief that if you just give developers free reign to build as much as they want, that housing prices in wealthy neighbourhoods will actually drop. The very expensive cities of the world also happen to have extremely high densities to begin with. I'm so sick of talking heads/newspaper columnists spouting ECON 101 textbooks like its gospel.

I'd also like to see some actual evidence supporting the belief that if you just give developers free reign to build as much as they want, that housing prices in wealthy neighbourhoods will actually drop. The very expensive cities of the world also happen to have extremely high densities to begin with. I'm so sick of talking heads/newspaper columnists spouting ECON 101 textbooks like its gospel.

Extremely high density housing is expensive to build, so obviously. Expensive cities are dense because they're expensive. If they weren't expensive, developers couldn't justify building infill and they would be low density. Typically you have cheap cities, they're less desirable and so there's little pressure to infill, like maybe Toledo. Once they get desirable/expensive enough to justify higher density infill, the city will typically allow some, but usually NIMBYism means there will be enough restrictions that the amount of supply added is less than if there were no restrictions at all.

The Bay Area is less affordable than Toronto though for example, despite being a similar density, which is imo partly because the Bay Area has more development restrictions, and as a result is building less than half as much infill and about a third as much housing overall (if not less). Vancouver is less affordable than New York too, and New York is of course quite a bit denser. LA and Toronto are more affordable than Vancouver by quite a bit, despite being about the same density, if not a bit denser. Washington and Miami aren't too bad for affordability and are pretty dense, a bit less so than SF and LA but denser than San Jose. Portland is about the same density as Texas cities but much less affordable.

With Toronto, and sometimes other Canadian and American cities though, a big difference compared to elsewhere is the affordability of housing in the <1500 sf range. Large single family homes are pretty affordable compared to most places. It's kind of like, an upper middle class household in Toronto can affordable a 2000 sf house in the burbs while in many cities they couldn't, however what the average household in Toronto can afford is maybe more like a 1000 sf apartment in the burbs, but that's only slightly 1.5x less expensive than a 2000 sf house. In an unrestricted housing market, the 1000 sf apartment should cost 2-3 times less than the 2000 sf house in the same area. You might have a 1 bedroom condo going for $450/sf in the burbs, and then a SFH going for $300/sf a block away, when the SFH should actually cost more per sf. I think many neighbourhoods in the GTA are unbalanced in this regard.

Think about it, a SFH is lower density housing. If you have a 1500 sf apartment building with 5 units in the same amount of land as a 1500 sf SFH (or rowhouse, whatever), the land cost is distributed across more units for the apartments so it should be lower per unit. Assuming the same quality of construction, the building cost should be the same per sf. So the apartment should cost less per sf. Although higher density housing costs more per sf to build, a developer can make up for this since the land cost per unit is lower, until you reach a point where the cost of construction gets so high it's not worth it anymore. The balancing point depends on the cost of land, the higher the land cost, the higher the optimal density.

So how can you have 1-2 bed condos that are more expensive than SFH in the same neighbourhood?
1) Shortage of 1-2 bed units. You're generally not allowed to build 1-2 bed units in SFH neighbourhoods. It wouldn't even have to be denser necessarily, just having, 3x1000sf triplexes, 2x1500 duplexes and 3000 sf SFHs on the same sized lots is a possibility.
2) Since there's much more land that is zoned to allow SFHs than land zoned to allow apartments, and there is a shortage of 1-2 bedroom units (that don't make sense in SFH form), land zoned to allow apartments is worth more. So as a result, the balance between reducing land cost and increasing construction cost occurs at a higher density, which means higher cost per sf of apartment too.

This is probably part of the reason why Toronto has few 3+ bedroom apartments compared to other cities. It has a shortage of 1-2 bedroom units, so it builds those wherever multi-family is allowed, and makes up for a lack of 3+ bedroom apartments by having a relative overabundance of 3+ bedroom SFHs.

And having SFH cost more per sf is ok. Many people would be willing to pay more for the yard space. However, once land costs get to a certain point, having a yard becomes more and more of a luxury. When a 1500 sf SFH with a yard costs the same as a 1800 sf apartment, many people will go with the house. But land costs get to where you can only get a 900 sf SFH for the price of a 1800 sf apartment, many people will decide the SFH is too small and the yard is not worth it. And if a SFH in Mississauga costs $400/sf and an apartment $350/sf instead of $300/sf and $450/sf, you'll see quite a bit more apartments being built, which is a good thing for most urbanists.

So if I'm saying there's a shortage of small apartments and an overabundance of big SFHs, then why are SFH prices rising faster? Because SFHs are getting bigger and bigger while apartments are getting smaller and smaller. Apartments are getting smaller because housing in general is getting more expensive (such as due to outwards expansion due to Greenbelt/Place to Grow/congestion), and people can afford less space.

Why are SFHs getting bigger? Because much of the cost of an SFH is in the land, so having a bigger house is not that much more expensive. If you have a 1/10 acre lot where the land costs $300,000, and buildings themselves are worth $120/sf...
1000 sf house = $420,000
2000 sf house = $540,000
3000 sf house = $660,000

VS if the land costs $50,000 (common in many Southern and Midwestern US cities, if not cheaper, and also some of the less expensive Canadian cities are around that.
1000 sf house = $170,000
2000 sf house = $290,000
3000 sf house = $410,000

In % terms, the difference between a small house and a big house is smaller when land is expensive. So you have more of an incentive to take on a bit more depth, or maybe have your kids live with you in a bigger more expensive housing instead of helping them buy a place of their own, or in the case of some immigrants, a stronger incentive to have grandparents or uncles and aunts living in the same house as the parent and their kids. This might be less pronounced if it was possible to subdivide lots in lower density SFH neighbourhoods, or if there weren't various requirements for new neighbourhoods that encourage larger lots... These include various setback requirements, off street parking requirements, and requirements for large ROWs. The increase in average house size is not just a result of bigger homes built in new developments, but also tear downs.

And SFHs have also been getting more expensive because of the higher land costs. Nonetheless, I'd be curious to see how the price of these changed in the last 10-15 years.

a 2000-3000 SFH in an outer suburb on a small lot built around late 90s
a 3-4 bedroom condo in the outer 416 or 905 built around late 90s
a 1 bedroom condo in the outer 416 or 905 built around late 90s
a 1000-2000 SFH in the 416

Like I remember how much my parents sold the townhouse we lived in in the 905 in 2001, and similar townhouses in the same area are only about 35% more expensive now adjusted for inflation. This is about 1400sf +600sf in the basement or something, so a on the small side for what I'd want for comparison purposes, although land costs would have been low since it was an outer suburbs and small townhouse lot. The home they moved to, a bungalow on a relatively large lot, had it's value appreciate quite a bit, maybe over 60% adjusted for inflation. However, I remember the first big 4000sf+ teardown homes that were being built in the new neighbourhood starting around 2002 (and continuing to this day) were listing for a little over $2 million already back then, adjusted for inflation, those basically haven't increased at all. Has anyone been looking at condos 10-15 years ago and remember how much they were going for in certain areas (for a specific size, ideally specific building)?

 

[DarnDirtyApe]

The comparison between subsidized housing and food stamps is total BS. This is a planning decision. Whether you want to agree with it or not, urban planners realize that mixed-income neighbourhoods are much, much more functional than income-segregated neighbourhoods. If the "free" market tends toward segregation, planners must use the tools they have available to them to try to correct that.

Can we see some evidence that centrally planned mixed-income neighbourhoods are more "functional"? From what I see in a casual search, there is little evidence that this type of planning has had any success in poverty reduction, and in fact there is little social mixing of those in different income groups.

Finally, for all those bitching about subsidized housing and forcing the rich to pay more for things that poor people are getting for a lot cheaper, you must really, really hate taxes. You must feel like fools yourself every time you pay income tax to realize that the poor are getting the exact same social services as you for a much lower price. Damn, the poor have it so well in our society.

The issue here is that we all pay for public housing through our property taxes, and that money should be spent where it is most effective.

 

[Silence&Motion]

Can we see some evidence that centrally planned mixed-income neighbourhoods are more "functional"? From what I see in a casual search, there is little evidence that this type of planning has had any success in poverty reduction, and in fact there is little social mixing of those in different income groups.

The classic studies that show how social isolation/segregation of the urban poor amplify the negative effects of poverty include Wilson's The Truly Disadvantaged and Massey's American Apartheid.

Studies of mixed-income housing are more preliminary, since it's a relatively new idea. It's too early to see the long term, generational effects of mixed-income housing. However, the research that does exist suggests that mixed-income housing alleviates the extreme crime and health effects of segregation (though it doesn't "solve" inequality). These studies include work by Chaskin, and Tach.

I would also add that the development in question is not a "centrally planned" neighbourhood (is that terminology supposed to invoke scary images of Stalin or something?). It's a single development that traded subsidized units for tax breaks. There are a variety of ways to attempt to create mixed income neighbourhoods. As with most social issues, the problem seems to be clear (the dangerous effects of segregation), but the solutions will take time to work out.

The local "success story" is the St Lawrence community which has become the model for the redevelopment of Regent Park and other subsidized housing districts.

The issue here is that we all pay for public housing through our property taxes, and that money should be spent where it is most effective.

I agree, but I think your solution (that the TCHC exclusively buys up aging buildings in undesirable neighbourhoods) is not effective.

 

[DarnDirtyApe]

It's "centrally planned" in the sense that city planners are deciding where to build housing dedicated for "the poor" instead of more organic approaches that might happen in a traditional neighbourhood with a mix of housing types of different age and finishes that would cater to different parts of the market - single family dwellings in various states of renovation, apartments above stores, fancy condos, older apartments, and so on. Of course the latter approach would mean that (gasp) people have to make choices among options they can afford rather than hoping to win the TCHC lottery and get placed in a brand new building.

My solution would involve TCHC getting out of the housing business for all but the most vulnerable people (seniors, the disabled, homeless, refugees) and instead use a voucher system. That way a person could decide where they want to live, and we wouldn't need to worry about "poor doors" and the like.

I wouldn't really call the St. Lawrence neighbourhood that much of a success in terms of social integration - there are TCHC buildings that are for poor people, and there are condos for empty nest middle class people young and old. Not many families with kids outside of subsidized housing, since when it comes down to it middle class parents don't want their kids mixing with poor kids. TCHC residents are not going to The Keg on Friday night, and condo-living working professionals are not playing basketball in David Crombie park either. Speaking frankly as someone who lived in the neighbourhood, the TCHC residents added nothing to the neighbourhood and might as well not have been there for all I saw.

With an average length of stay for TCHC residents of 10 years and only 1/3 of household heads having any employment income, there is clearly something wrong with the picture.

 

[freshcutgrass]

No it doesn't.
It achieves the purpose of putting the rich and poor in the same building without pretending by doing so rich and poor people are all of a sudden "equal". The rich still shop at neiman Marcus and the poor at sears.

And what impact is this going to have in terms of entering and exiting the building?

Keep in mind the developers reap $millions from this program, and the developer in question opted to provide the affordable housing on site, rather than off site.

Folks...this is the USA...segregation is entrenched there. I don't see this happening here because that kind of blatant segregation would just not be acceptable. It's also completely unecessary.... we already have mixed income buildings, and I've been in them. I'd dare you to tell the difference between who is a subsidized tenant and who is not by watching them come and go throgh the lobby (or swimming in the pool).

 

[toraerach]

My solution would involve TCHC getting out of the housing business for all but the most vulnerable people (seniors, the disabled, homeless, refugees) and instead use a voucher system. That way a person could decide where they want to live, and we wouldn't need to worry about "poor doors" and the like.

This sounds like a scheme to subsidize the slumlords instead of directly providing housing to those who need it. The language of choice sure sounds nice, but where has it ever worked? If the TCHC bureaucracy is bad enough as it is, how would adding hundreds (if not thousands) of private landlords into the mix make it any better?