Wednesday, February 14, 2007

Affordable housing: low income or below market--and neither

During the federal court hearing last Wednesday on the Atlantic Yards eminent domain case, Forest City Ratner attorney Jeffrey Braun, in answer to a question about the definition of "affordable housing," responded by saying "below market."

"We have a long history of public intervention in the housing market," he added, citing such programs as the Mitchell-Lama middle-income program, zoning incentives, and the city's plans to increase low-income units.

But "below market" was an imprecise description.

What's affordable

Affordable housing is more precisely described as subsidized housing which, for rentals at least, the rent is pegged at 30 percent of household income. (The affordable housing universe includes a much smaller fraction of subsidized for-sale units.)

Earlier in the Atlantic Yards debate, even Forest City executive Jim Stuckey described the planned project as “50% market, 30% middle-income, 20% affordable." (This tracks the city's New Housing Opportunities Program, or New HOP.)

There would be 2250 subsidized rental units in the Atlantic Yards plan, of 4500 rentals. (In addition, there would be 1930 condos, of which 200 would be subsidized.)

Of the subsidized rentals, 900 (40 percent) would be designated low-income. That means families earning 50 percent or less of the area median income (AMI), or $35,450 for a family of four. Because the AMI calculation involves wealthier suburban counties, it turns out that 50 percent of AMI actually approximates Brooklyn's household median income.

Another 900 of the 2250 units would be pitched at 100 to 160 percent of AMI, or at least $70,900 for a family of four. While such families might not find rentals at 30 percent of their income in much of Manhattan, that's not the same for Brooklyn.

$2127 a month

Let's look at the Atlantic Yards housing chart. For the two higher-income bands, involving 900 units, two-person households would pay $1701 or $2127 per month for an apartment.

How does that compare to market rents nearby? I looked at the listings from the high-end Corcoran agency, checking off Boerum Hill, Fort Greene, Park Slope, and Prospect Heights, the neighborhoods closest to the project site (which would be mostly in Prospect Heights).

A sampling includes a Prospect Heights one-bedroom for $1395, a Fort Greene one-bedroom for $1400, a Park Slope one-bedroom for $1600, a Fort Greene studio for $1650, and a Boerum Hill one-bedroom for $1900.

Now, a Frank Gehry-designed building with new fixtures may indeed be worth a premium, and the Atlantic Yards project site may be a better location than some of the above buildings. Still, some of the Atlantic Yards affordable housing would not be clearly below market in the neighborhoods around Downtown Brooklyn.

At an affordable housing information session last July, ACORN's Bertha Lewis said that people eligible for the Atlantic Yards affordable housing were "paying a minimum of $2500 up to $4000.” That wasn't fully accurate, and it wasn't that relevant to the large audience, a large majority of whom were hoping for access to the lower-income affordable housing.

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