By: Samantha VanWinter, staff editor

 

According to the Department of Housing and Urban Development (HUD), “families who pay more than thirty percent of their income for housing are considered cost burdened and may have difficulty affording necessities such as food, clothing, transportation, and medical care.”[1] However, millions of Americans divert a much higher percentage of their income towards their homes. About twelve million homeowners and renters in the United States direct more than fifty percent of their annual income to paying for housing.[2] This burden subjects this portion of the public to additional hardships, including an increased risk of homelessness, higher rates of preventable illness, higher criminal rates, as well as general instability caused by economic pressures tied to housing.[3] In Richmond, approximately twenty-seven percent of households direct more than fifty percent of their income annually to paying for housing.[4]

A report published in 2015 estimated that Richmond will need at least 15,000 additional housing units to meet the demand for affordable and low-income housing across the Richmond area.[5] The $1.5 billion Navy Hill redevelopment project has promised to create a portion of the affordable housing to meet growing demand in Richmond.[6] A provision in the Navy Hill deal sets $10 million aside as philanthropy dollars directed toward the creation of affordable housing.[7] The Navy Hill development project would be an effective and creative way to create more affordable housing options in Richmond. However, it seems that the effectiveness of this redevelopment, and similar projects, turn on the definition of “affordable” and the amount of truly affordable housing that is actually created. Of the 2,300 units planned to be built in the development, about 280 are set aside as “affordable”.[8] In this case, affordable housing is catered towards those making “80% or less of the Metro Richmond median income of $83,200.”[9] This eighty percent of the median income in the Richmond Metro area ranges from about an annual income of approximately “$46,600 a year or less for an individual, to $66,550 or less for a family of four.”[10]

While the goals of the project are admirable, the stock of affordable housing provided by this project may not be as affordable as they seem.[11] When comparing the average market rate rent in the Navy Hill area ($1,180 for a studio, $1,550 for a one-bedroom and $2,100 for a two-bedroom), to the income-restricted units to be offered in the redevelopment project ($977-$1,180 for a studio, $1,047-$1,509 for a one-bedroom apartment and $1,256-$1,811 for a two-bedroom), the numbers are strikingly similar.[12] Additionally, the developer is required to offer the designated portion of the affordable housing stock as income-restricted units for only twenty years.[13]

These units, though deemed affordable, will likely be priced out of the range many assume that affordable units are aimed towards.[14] While many would believe these affordable units will be built to serve those individuals working minimum wage jobs, “somebody working a full-time, minimum wage job would need to spend their entire monthly paycheck on an income-restricted studio apartment at Navy Hill.”[15]

The affordable housing project is not projected to be available until 2022.[16] These apartments will be newly constructed units and the prices of the units cited by the developer include predictions about the status of the rental market at the time the units are offered for rent.[17] However, despite these qualifications, the question of how affordable these units will truly be for those who need them the most remains.

 

[1] U.S. Dep’t. of Housing and Urban Development, Affordable Housing, https://www.hud.gov/program_offices/comm_planning/affordablehousing/(last visited Dec. 1, 2019).

[2] Id.

[3] Richmonders Involved to Strengthen Our Communities, Affordable Housing (2019), http://www.riscrichmond.org/affordable-housing.

[4] Id.

[5] Roberto Roldan, How Affordable Is The “Affordable Housing” In The Coliseum Development? Rents In Line With Market Rate, (Aug. 19, 2019),  https://vpm.org/news/articles/3112/richmond-grapples-with-how-to-expand-affordable-housing.

[6] Jeremy M. Lazarus, Navy Hill Ship Sinking? Scrutiny of Coliseum Replacement Plan Reveals Major Gaps, (Oct. 31, 2019), http://richmondfreepress.com/news/2019/oct/31/navy-hill-ship-sinking/.

[7] Roberto Roldan, How Affordable Is The “Affordable Housing” In The Coliseum Development? Rents In Line With Market Rate, (Aug. 19, 2019),  https://vpm.org/news/articles/3112/richmond-grapples-with-how-to-expand-affordable-housing.

[8] Jeremy M. Lazarus, Navy Hill Ship Sinking? Scrutiny of Coliseum Replacement Plan Reveals Major Gaps, (Oct. 31, 2019), http://richmondfreepress.com/news/2019/oct/31/navy-hill-ship-sinking/.

[9] Id.

[10] Id.

[11] See Roberto Roldan, How Affordable Is The “Affordable Housing” In The Coliseum Development? Rents In Line With Market Rate, (Aug. 19, 2019),  https://vpm.org/news/articles/3112/richmond-grapples-with-how-to-expand-affordable-housing.

[12] Id.

[13] Id.

[14] Id.

[15] Id.

[16] Id.

[17] Id.