Four ideas to fix affordable housing in Miami

We spent yesterday helping the Miami Coalition for the Homeless put on their Homes for All Housing Summit, where we learned a lot about Miami’s housing situation. More than 200 attendees from government, business, and community groups worked together to identify top priorities for policy changes and new programs that could improve affordable housing in Miami.

The idea that places to live in Miami are expensive won’t come as a surprise— but the extent of our affordability problems may.

Source: Florida Dept. of Economic Opportunity, Occupational Employment Statistics and Wages, Center for Housing Policy, Miami Coalition for the Homeless

The average Miamian spends more than 70% of their income on housing and transportation, more than any other of the 25 largest metropolitan areas, according to a 2012 study from the Center for Housing Policy (PDF). That same study found Miami to be the least affordable large metropolitan area, ranking worst on housing as a percentage of income and also ranking worst on the combined costs of housing and transportation as a percentage of income.

Miami’s moderate-income homeowners have it even worse than renters, spending an average of 75% of their incomes on housing and transportation costs.

Many conversations about housing policy focus on “extreme low income” (or ELI) households, but in Miami even medium-income professionals (say, a young person making $40,000 per year) can be “housing poor,” spending an untenable percentage of their annual income on a place to live.

Here are four ideas we heard at the summit that could make a difference. All of them will be up for discussion at the May 14 meeting of the Miami-Dade County Commission’s Economic Prosperity Committee.

1. Increasing funding for mixed-income housing and public-private partnership incentives.

Miami residents are significantly divided geographically by their income—there are few developments, relative to other large cities, that incorporate a mix of subsidized affordable units and market-rate units. Participants advocated for public-private partnerships that could incorporate more affordable housing into private projects, rather than relying solely on local government to construct dedicated low-income housing.

Mixed-income housing projects have been found to increase quality of life and economic outcomes for low-income residents—though existing studies are unclear on whether there are long-term social benefits for interaction between low-income and higher-income residents.

Florida has a housing trust fund for this purpose, but since the early 2000s much of its annual funding has been redirected to general revenue and other purposes.

2. Preserving Miami’s existing affordable housing.

Loss of existing affordable housing stock is a major issue in South Florida, where many properties are lost to dilapidation or when they are converted to market-rate housing at the conclusion of existing mortgages.

Preservation work aims to catalog properties at risk for conversion to the market-rate, and support keeping them affordable through restructuring their debt, property tax relief, or new funding sources.

3. Localizing measures of housing affordability.

Quantitative benchmarks and formulas used to decide whether people are eligible for housing assistance programs, such as area median income (or AMI), are set at the federal level and do not consider local differences in people’s lives that may affect calculations. For example, in Miami the high cost of transportation coupled with housing costs is what causes most affordability issues; for residents of another city with better transportation, a similar salary might be sufficient to live on comfortably.

Summit participants suggested developing local measurements to understand and track affordability in Miami-Dade County over time.

4. Creating community land trusts.

Maintaining affordable housing is especially difficult during development booms and in growing housing markets, because the price of land can disrupt efforts to build affordable projects and discourage developers of market-rate projects from including affordable units in their plans.

Community land trusts are used across the country to develop affordable housing on land owned by nonprofit trusts. Research has found that these trusts can help protect affordability in growing cities, particularly near transit hubs, where prices tend to accelerate more quickly.