Monday, February 15, 2010

Gentrification, "Brooklyn's Roommate Belt," and how housing code changes could produce more affordable housing

You can't just blame developers, or Wall Streeters with cash to burn. One important driver of gentrification may be the housing code, which makes it hard for developers to build low-cost studio apartments, instead aiming at larger apartments and luxury studios.

Former Citizens Housing and Planning Council (CHPC) fellow Denali Dasgupta, now a Policy Analyst in the New York City Comptroller's Office, at the Dreamland Pavilion Conference last October contended that the cause may be less market forces than market failure.

And a revision in regulations might produce a lot more affordable housing, I'd suggest, leaving less opportunity for projects like Atlantic Yards, however questionable, to be seen as saviors.

The "Roommate Belt"

Thus, Dasgupta described what she called "Brooklyn's Roommate Belt," zones of Brooklyn--originally neighborhoods like Park Slope and Fort Greene, now extended to Kensington, Prospect Heights and Bedford-Stuyvesant--which contain large numbers of unrelated young adults sharing apartments.

While they work in relatively low-wage jobs, their collective income is higher than working-class neighbors, and thus their presence shapes gentrification, making apartments less affordable for long-term families and driving retail that speaks to their needs more than anything.

(A prime example, discussed in another session, is the lopsided ratio of laundromats to bars/cafes in Williamsburg.)

One Size Fits Some

As CHPC executive Jerilyn Perine explained at a 9/24/09 symposium, One Size Fits Some:
One of the many ironies of life in New York City is that, in a place where people are obsessed with real estate, housing, and the ensuing discussions about what people have, who has a good deal, and what they pay for it, there is little discussion or even awareness of New York City’s housing standards. And yet it is housing standards that largely determine who lives where and how much they pay for it. These standards implicitly encourage the construction of larger units rather than small ones, make it illegal for more than three unrelated adults to live together, make outlaws of extended families living in basements of small homes, and permit homeless single adults to sleep in doorways, but not in lodging houses or Single Room Occupancy units (SROs), both of which have been outlawed.
Symposium

City Limits, in a 10/5/09 article headlined PROPOSED: NYC SHOULD HAVE EVEN SMALLER APARTMENTS, reports on an initiative of the CHPC:
Many current housing rules stifle innovative design, restrict the construction of new affordable housing, and exacerbate the city’s never-ending housing shortage — practically making overcrowding the unofficial housing policy.

“We need more variety — more different types of housing,” says Jerilyn Perine, a former city housing chief who for the past three years has headed CHPC. “For 100 years we used to think of ourselves as the housing innovators. We’ve lost that edge.”
At “One Size Fits Some,” designers and developers from numerous places described "well-designed small homes and shared spaces that are difficult, if not impossible, to build under New York’s existing building codes."

Every apartment must have its own kitchen and a bath, thus ruling out certain configurations, including Single Room Occupancy buildings--once quite notorious but also a key source of housing for part of the population.

One reason housing advocates haven't pushed changing the rules, Perine told City Limits, is that if New York actually enforced the current housing code, immigrants sharing overstuffed apartments and houses would bear the brunt of the crackdown.

Indeed, the Daily News, in an 11/15/09 article headlined Hidden deathtraps: After Flushing fire and 200K complaints, divided apartments still run rampant, reported that the city has received more than 20,000 [not 200,000] complaints about illegal apartments in each of the past three years, with half of the investigations closed because the Buildings Department never got inside.

Perine in her speech said:
What are the best ways to house single adults? Is there room in the housing market for a new SRO model and new lodging houses? Can 21st century technology and fire safety techniques help to make new adaptations safer, cheaper, and more widely available for low wage workers and new entrants into the housing market?
One solution

City Limits reported:
One speaker already has a few proposals for New York. Thousands of rowhouses could be modified to include an extra apartment if the state legislature and city council would change the law, according to Alex Garvin, president and CEO of Alex Garvin & Associates, a locally based planning and design firm.
There's more, including audio and floor plans, from Urban Omnibus. Garvin pointed out that many garages in Queens are already used as mother-in-law apartments.

"Change the definition of multiple dwelling," he added. (A multiple-dwelling building is three units or more.) "Go from 'two units or less' to 'three units or less' [for buildings that get less regulation]. All of a sudden everything changes."

He also said that, by reducing the parking requirements associated with apartment buildings, it would be cheaper to build affordable housing. (Parking policy was notoriously left out of Mayor Mike Bloomberg's PlaNYC 2030.)

3 comments:

  1. Norman,

    Hi!

    - - - - - - - - - -

    Norman wrote (emphasis is mine -- BH):

    "Former Citizens Housing and Planning Council (CHPC) fellow Denali Dasgupta . . . contended that the cause may be less market forces than MARKET FAILURE."

    Benjamin writes:

    Norman, the wording of this comment, as it stands now, doesn't seem to me to make sense. It seems self contradictory.

    If people are saying, as Ms. Dasgupta and others seem to be saying here, that various misguided government regulations (e.g., mandatory parking minimums, etc.) are at least somewhat responsible for retarding the construction of appropriate new housing in New York City (and for creating a scarcity that drives up rents and prices), then this is not what is commonly referred to as "market failure." It is commonly called "misguided government over regulation," or something like that. "Market failure" generally means something else entirely -- a situation where the marketplace fails even when it is left to its own devices -- i.e., even WITHOUT misguided govenment regulations.

    Thus using the expression "market failure" in this context is, so it seems to me, essentially self-contradictory and thus confusing.

    So, if I understand Ms. Dasgupta's position correctly, logically speaking (i.e., making the statment more congruent with what she and the rest of the post seem to be saying), this statement "should" have been worded something like the following:

    "Former Citizens Housing and Planning Council (CHPC) fellow Denali Dasgupta . . . contended that the cause may be less market forces than misguided government over regulation of the marketplace."

    By the way, if this is indeed the argument that is being made, it isn't a new argument at all. The Manhattan Institute and NYU Law School's Center for Real Estate and Urban Policy, among others, have been making such arguments for years. (I believe Jane Jacobs has been saying this for years also, but I don't have any quotes handy.)

    Here are four books, for example, that deal with this issue directly or indirectly:

    1) "The Ecology of Housing Destruction," by Peter Salins (published around 1980). This book, rather than dealing with the PRODUCTION of inexpensive housing, deals with the issue from the "other side," the LOSS of sound inexpensive housing. (The net effect is the same -- a scarcity of good, inexpensive housing.) It's the author's contention that misguided government policies GREATLY accelerated housing abandonment in the 1970s -- thus leading, in the author's opinion, to enormous losses of otherwise sound inexpensive housing that greatly decreased the City's otherwise abundent supply of good inexpensive housing.

    2) "Scarcity by design: the legacy of New York City's housing policies," by Peter Salins (1992).

    3) "Reducing the cost of new housing construction in New York City," by Salama, Schill and Stark (1999).

    4) "America's Trillion-Dollar Housing Mistake," by Howard Husock (2003). This book actually focuses on the mistakes of public housing, but does discuss here and there, how over regulation creates scarcity.

    Regards,
    Benjamin Hemric

    Tues., 2/16/10, 1:25 p.m.

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  2. Norman,

    Brooklyn used to have boarding houses, which could be a significantly nicer place to live than SROs. Think of the house in Prospect Park South in Sophie's Choice. A friend lives in a similar situation in Cobble Hill, but they're much less common than they used to be.

    John

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  3. I agree with the commenter above, and the books he's recommending are excellent.

    If you want a particularly good explanation of why there's a shortage of affordable housing in New York -- which had nothing to do with market failure and everything to do with government failure -- read Edward Glaeser's paper "The Impact of Zoning on Housing Affordability."

    Jim Epstein

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