After a years-long neighborhood battle against an oil drilling site in South Los Angeles, a local nonprofit has purchased the now-demolished facility and plans to transform it into a park, community center and affordable housing.
The Los Angeles Neighborhood Land Trust recently bought the 1.86-acre dirt lot on Jefferson Boulevard for nearly $10 million from Sentinel Peak Resources. The nonprofit and its partners are now seeking grants and other funding sources to pay for planning, remediation and project execution.
“It’s what we hoped for,” Richard Parks, president of the South L.A. nonprofit Redeemer Community Partnership, said of the purchase. “It’s just so amazing to see our community receiving beauty for ashes. It’s overwhelming and feels like such a blessing.”
The sale marks a new chapter in a persistent and community-led fight against the oil drilling site, which residents argued for years was noisy and spewed foul odors. It also comes at a time of growing concerns about the risks and inequities of urban drilling in neighborhoods. L.A. City Councilmember Katy Yaroslavsky recently introduced legislation aiming to address public health and environmental threats posed by a drill site near the Pico-Robertson area.
Oil wells are known to emit carcinogens such as benzene and formaldehyde, and living near wells is associated with health problems such as respiratory issues and preterm births, studies have found.
Community leaders hope the purchase serves as a model for how to repurpose shuttered fossil fuel facilities as the city phases out existing oil and gas wells, a historic move approved last year by the L.A. City Council that also bans new oil and gas extraction.
Tori Kjer, executive director of the L.A. Neighborhood Land Trust, believes it is critical that these sites are transformed into uses that benefit communities historically affected by oil drilling. “It’s an environmental justice issue,” she said. It’s also imperative that planned site uses won’t displace residents through gentrification, she added.
“It’s so important, this idea of joint development, where you’re layering in affordable housing, community space and a park together,” she said. “For us, it’s really the ideal approach to equitable development in communities. … This is a rare opportunity, and an important opportunity, as we think bigger scale about future types of development in Los Angeles.”
Kjer estimates they will need three to six months and about $600,000 for remediation planning, and an additional year and $2 million to $3 million for cleanup. They are seeking state grants. The park’s budget will be about $6 million.
Lori R. Gay, president and chief executive of the Neighborhood Housing Services of Los Angeles County, said their target is to build 70 affordable housing units. They are also considering creating a community land trust to preserve the neighborhood and produce new homeowners.
After a years-long neighborhood battle against an oil drilling site in South L.A., a local nonprofit has purchased the now-demolished facility and plans to transform it into a park, community center and affordable housing.
(Francine Orr / Los Angeles Times)
“The Jefferson site is in a homeownership community, so we wanted to maintain both the integrity and culture of the community with affordable homeownership,” she said. “It is too easy to just build affordable housing focused on tenancy and not provide the opportunity to build generational wealth. This development provides the opportunity to build wealth for generations to come.”
But the grand visions for the property won’t come without hurdles.
Finding land trust lenders will be challenging, Gay said, as will plan reviews and significant market changes that could hinder the speed of development. Having multiple partners involved in a large project could also further complicate it, Kjer added. Planning, remediation and raising and finding finances will also be tricky.
“The housing kind of funds itself, and we have some really good prospects for funding the park through different grants, but the community center I think will be a very big challenge,” Parks said. “How do we raise the several million dollars to be able to build that out for the community?”
First approved nearly 60 years ago, the South L.A. oil site on West Jefferson Boulevard and Van Buren Place was situated closer to homes than any other city drilling facility, according to the nonprofit Community Health Councils.
In 2013, environmental justice advocates with Redeemer Community Partnership began organizing after the oil company requested permits by the city of Los Angeles to drill three new wells.
Parks remembered knocking on residents’ doors and hearing concerning stories about the nearby oil facility: One woman was sprayed with oil while she watered her front lawn. The noxious smells of diesel exhaust and petroleum fumes permeated through a toddler’s room even with the windows closed. Others complained of headaches and nosebleeds, and miscarriages were commonplace, he recalled.
A report by a petroleum administrator, who was hired in 2016 to oversee oil and gas operations in the city, noted that the Jefferson Boulevard facility was classified as having hydrogen sulfide gas, which can give off a rotten-eggs odor and cause smell loss, and that chemicals such as benzene have also been emitted from the site.
A group of community members who were involved in the fight against the Jefferson Boulevard oil drilling site stand on the demolished facility.
(Francine Orr / Los Angeles Times)
In 2017, after persistent demands from community activists to enclose the site, L.A. City Council members issued a set of stringent rules that oil companies must follow if they wanted to continue operating drilling sites next to homes in South L.A.
The requirements included, among other things, that drilling equipment be permanently closed off by a 45-foot-tall structure to reduce noise, odors and block glaring lights. It was a big victory for community activists, who had argued that the site exemplified the toxic outcomes of oil drilling in urban neighborhoods.
Officials at the time described the requirements as the toughest ever imposed on a drill site in L.A.
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Sentinel Peak Resources spurned the commands and filed a lawsuit. The company argued that the new mandates were “unduly oppressive” and would force it to reduce or stop its operations.
Nearly a year later, the company announced it would shutter the site for good.
While it removed all oil operating equipment and capped the 36 wells on site, the community began working on a shared vision for the site’s future.
“Because we knew if we did not do that, that the toxic violence of oil extraction would be replaced by the violence of displacement,” Parks said. “Developers are coming in, they’re tearing down homes, they’re building up student housing, they’re driving out longtime residents, and we didn’t want to see that happen.”
With help from California Assemblymember Reggie Jones-Sawyer (D-Los Angeles), who is running for L.A. City Council District 10, they secured a $10-million state grant for those efforts.
“I’m really excited,” Jones-Sawyer said. “This will be the blueprint for how you can effectively make changes.”
When Redeemer Community Partnership contacted him about their vision for the land, “it seemed like the perfect combination of dealing with our housing crisis and dealing with our crisis with having no open space. And so when I had the opportunity to provide the $10 million … it seemed like a wonderful opportunity,” Jones-Sawyer said.
For residents such as Corissa Pacillas, who fought for years for more stringent protections from the Jefferson Boulevard site, the purchase exemplifies the power of organizing.
“It was encouraging to see that when people really intentionally organize and speak up, and are persistent … passionate and have good leadership … that change can happen,” said Pacillas, who spent years documenting the facility’s activities from the porch of her second-floor apartment. “I’m just so excited that the property … is going to go toward really benefiting the community.”
Last December, Mayor Karen Bass moved to speed up the production of affordable housing in Los Angeles by issuing Executive Directive 1. This measure streamlines the approval of new multi-unit residences by exempting them from the usual slate of hearings, appeals and environmental reviews. The city Planning Commission voted this month to continue ED1, bringing the directive one step closer to becoming permanent.
On its face, this is the sort of bold housing policy Los Angeles needs. The city is not building nearly enough units to meet demand. In fact, an LAist analysis found that from 2010 to 2019, the city lost eight times more homes that were affordable for low-income residents than it gained.
This has partly been due to developers being deterred by lengthy, expensive and risky approval processes for new construction. On its face, ED1 is helping to chip away at that problem: The Department of City Planning reported that, as of the end of October, it had approved more than 50 new developments under the directive and had 55 other applications pending, projecting the addition of 12,383 new affordable homes.
But absent from this success story is the way this directive is reshaping the character and makeup of Los Angeles’ working-class neighborhoods and displacing longtime residents. In her effort to permanently streamline the construction of affordable housing, Mayor Bass is asking the city to weigh in on a bigger question: Who gets to live in Los Angeles?
According to our analysis of city data, in ED1’s first 10 months, more than a third of new developments filed under the directive have been in South Los Angeles, an area with one of the highest concentrations of Angelenos living in poverty. We also found that one-third of those South L.A. developments require the demolition of existing affordable housing, eliminating at least 62 rent-stabilized units in the area and displacing hundreds of residents, many of whom cannot afford to move elsewhere in their neighborhood or the city. Under the streamlined process, tenants have mere months to find new homes. We’ve talked to many such residents who fear they will become homeless.
It’s also worth noting where ED1 developments aren’t happening. In June 2023, Mayor Bass revised the directive to exclude parcels zoned for single-family homes — which initially made up more than half of approved projects, according to an analysis by Abundant Housing.
This change came after the city planning department heard “feedback” from residents it surveyed as well as members of the City Council concerned about apartment buildings “plunked down in the middle of single family neighborhoods.” This exemption prevents the city from streamlining the construction of affordable housing in these “higher-resource areas” with the least density. It also makes multifamily residential zones more of a target for developers.
If L.A.’s wealthy neighborhoods are preserved at the expense of low-income ones, we will all feel the consequences: rising rents as the number of rent-stabilized units continues to shrink; an increase in homelessness, especially for seniors and renters on fixed incomes who have no other housing options available; less diversity in Los Angeles as residents in the affected neighborhoods, which are predominantly Black and brown, scatter outside the city to afford rent; and more traffic as families have to relocate farther from their schools and jobs.
Los Angeles urgently needs more affordable housing, and streamlining the development process is a necessary step. But city leaders need to be mindful of what may be destroyed if the approach is not equitable. Before making ED1 permanent, the city should exempt rent-stabilized units from the streamlining process so that a more thorough assessment can take place and tenants have more time to consider their options. The city should further ensure that developers — even those pursuing 100% affordable housing projects, some of which may technically be exempt — comply with the obligations for relocation, right of return and right to remain under California’s Housing Crisis Act of 2019.
Displaced tenants also should receive more robust relocation services, including help securing comparable replacement housing in the same area. Under the current process, the city provides a list of potential housing providers and tenants are burdened with the search for affordable units.
Finally, single-family homes should not be exempt from streamlining. Such an exemption reflects the sort of NIMBY position that got us into this affordable housing crisis in the first place. It will only reinforce the inequity that has shaped housing policy in Los Angeles as affluent neighborhoods remain relatively sheltered from change while low-income neighborhoods are dismantled for the sake of growth.
Los Angeles’ leaders must consider the unintended consequences ED1 could have. Our city has to balance the need to build affordable housing with the need to keep our most vulnerable residents and communities housed and intact. Not doing so risks undermining the efficacy of this directive, which aims to ensure more Angelenos have access to affordable housing, not fewer.
Maria Patiño Gutierrez is the director of policy and advocacy, equitable development and land use at Strategic Actions for a Just Economy in Los Angeles.
LOS ANGELES — As more and more of her friends and neighbors found themselves priced out of rental units in Venice Beach, Judy Branfman began photographing the dozens of houses, bungalows and apartments being sold, renovated and then relisted at double or triple the cost.
Branfman started with only the vague idea that she should be documenting the growing problem of evictions and housing unaffordability in her beloved west Los Angeles neighborhood. The writer and activist lamented that Venice, where tourists flock to the famous boardwalk and Muscle Beach, has been slowly shedding its historically bohemian vibe and becoming another enclave for the wealthy.
Word spread about her photo project and earlier this year Branfman started hosting community meetings where residents could share their experiences with evictions that forced them to move out of the area and, in some cases, into homelessness. Some people recited poems. Others expressed themselves through paintings. And the more academically-minded among them began compiling housing and eviction statistics.
Branfman’s initial notion to just shoot a few photos has culminated in an unlikely but ambitious art-meets-data exhibit titled “Where Has All The (affordable) Housing Gone?” It’s on display through Saturday at Venice’s venerable Beyond Baroque gallery, a hub for cultural events and activism dating back to the late 1960s.
“The idea was to illustrate the problem, to show what we’ve lost. You know, make it visual so people would walk in and be a little shocked, and want to do something about it,” Branfman said at the gallery this week.
Venice became a center of the Los Angeles homelessness crisis during the coronavirus pandemic, when camps sprouted up in residential neighborhoods and along the sands. The nation’s second-largest city also has 46,000 residents who are homeless among the overall population of 4 million people, according to the most recent survey.
The area was a flashpoint because of its visibility as a city landmark — the boardwalk attracts an estimated 10 million visitors per year. A certain edginess always coexisted with a live-and-let-live ethos in the artsy beach community, but the widening of the wealth gap has become increasingly apparent as tech firms moved in and sleek modern homes went up.
As building owners seek to bring in more deep-pocketed renters, longtime residents find themselves dealing with rent increases that overwhelm their finances. Some 80% of low-income Los Angeles renters pay over half their income toward housing costs, according to data released this week by the nonprofit Angeleno Project.
While Los Angeles is on track to meet certain goals for new housing set out by recent ballot measures, “supply is severely behind demand,” the report found.
“Some 3,500 housing units are at high or very high risk of losing their affordability terms, threatening to push more families into homelessness,” said the report. “A significant dip in affordable housing that started in 2022 post-COVID-19 continues to trend downward.”
Upon entering Branfman’s exhibit, visitors are confronted by her photos on an enormous and detailed map depicting, block by block, many of the nearly 1,500 rent-controlled units she says have disappeared from the housing market in Venice over two decades. In many instances, the buildings were sold to large corporations that are increasingly buying up properties and jacking up rents.
The map, and much of the exhibit, pins some of the blame for the problem on the Ellis Act, a 1985 California law that gave landlords broad authority to evict tenants in rent-controlled buildings for redevelopment, and then later list the same units at market rates. Branfman said she was “Ellis Acted” when she was evicted from a Venice apartment in 2003.
“Too many tenants are afraid to fight back. And most don’t know what their rights are under the law,” she said. And even when tenants do file complaints against landlords, she said, the city very rarely prosecutes the claims.
On the wall opposite the map is a free-verse poem made up of quotes about why many renters are were afraid to take on landlords, such as: “I don’t want any trouble” and “My neighbors aren’t documented and they’re afraid if they say anything they’ll be targeted.”
Upstairs there are paintings and mixed-media figurines that the artist Sumaya Evans calls “dignity dolls.” Evans, who was homeless in Venice for years before recently finding housing, said creating art gave her a sense of self-worth when she was living on the streets.
“You get used to being ignored as a homeless woman. People are blind to you when you’re outside,” she said. “And so being a part of of a project like this, being a part of a community, is just so healing.”
Branfman and other housing activists are hopeful that change could come with measure that’s qualified for the 2024 ballot. The initiative that will go before voters would expand local control by overturning a 28-year-old law that prohibits rent control on single-family homes, condos and rental units that were built after 1995.
After the exhibit closes Saturday, Branfman hopes to find a home for some of the installations at a library or university. Most of it will live virtually on its own Instagram page.
“The rest of it will be on display in my apartment,” she laughs.
LOS ANGELES — As more and more of her friends and neighbors found themselves priced out of rental units in Venice Beach, Judy Branfman began photographing the dozens of houses, bungalows and apartments being sold, renovated and then relisted at double or triple the cost.
Branfman started with only the vague idea that she should be documenting the growing problem of evictions and housing unaffordability in her beloved west Los Angeles neighborhood. The writer and activist lamented that Venice, where tourists flock to the famous boardwalk and Muscle Beach, has been slowly shedding its historically bohemian vibe and becoming another enclave for the wealthy.
Word spread about her photo project and earlier this year Branfman started hosting community meetings where residents could share their experiences with evictions that forced them to move out of the area and, in some cases, into homelessness. Some people recited poems. Others expressed themselves through paintings. And the more academically-minded among them began compiling housing and eviction statistics.
Branfman’s initial notion to just shoot a few photos has culminated in an unlikely but ambitious art-meets-data exhibit titled “Where Has All The (affordable) Housing Gone?” It’s on display through Saturday at Venice’s venerable Beyond Baroque gallery, a hub for cultural events and activism dating back to the late 1960s.
“The idea was to illustrate the problem, to show what we’ve lost. You know, make it visual so people would walk in and be a little shocked, and want to do something about it,” Branfman said at the gallery this week.
Venice became a center of the Los Angeles homelessness crisis during the coronavirus pandemic, when camps sprouted up in residential neighborhoods and along the sands. The nation’s second-largest city also has 46,000 residents who are homeless among the overall population of 4 million people, according to the most recent survey.
The area was a flashpoint because of its visibility as a city landmark — the boardwalk attracts an estimated 10 million visitors per year. A certain edginess always coexisted with a live-and-let-live ethos in the artsy beach community, but the widening of the wealth gap has become increasingly apparent as tech firms moved in and sleek modern homes went up.
As building owners seek to bring in more deep-pocketed renters, longtime residents find themselves dealing with rent increases that overwhelm their finances. Some 80% of low-income Los Angeles renters pay over half their income toward housing costs, according to data released this week by the nonprofit Angeleno Project.
While Los Angeles is on track to meet certain goals for new housing set out by recent ballot measures, “supply is severely behind demand,” the report found.
“Some 3,500 housing units are at high or very high risk of losing their affordability terms, threatening to push more families into homelessness,” said the report. “A significant dip in affordable housing that started in 2022 post-COVID-19 continues to trend downward.”
Upon entering Branfman’s exhibit, visitors are confronted by her photos on an enormous and detailed map depicting, block by block, many of the nearly 1,500 rent-controlled units she says have disappeared from the housing market in Venice over two decades. In many instances, the buildings were sold to large corporations that are increasingly buying up properties and jacking up rents.
The map, and much of the exhibit, pins some of the blame for the problem on the Ellis Act, a 1985 California law that gave landlords broad authority to evict tenants in rent-controlled buildings for redevelopment, and then later list the same units at market rates. Branfman said she was “Ellis Acted” when she was evicted from a Venice apartment in 2003.
“Too many tenants are afraid to fight back. And most don’t know what their rights are under the law,” she said. And even when tenants do file complaints against landlords, she said, the city very rarely prosecutes the claims.
On the wall opposite the map is a free-verse poem made up of quotes about why many renters are were afraid to take on landlords, such as: “I don’t want any trouble” and “My neighbors aren’t documented and they’re afraid if they say anything they’ll be targeted.”
Upstairs there are paintings and mixed-media figurines that the artist Sumaya Evans calls “dignity dolls.” Evans, who was homeless in Venice for years before recently finding housing, said creating art gave her a sense of self-worth when she was living on the streets.
“You get used to being ignored as a homeless woman. People are blind to you when you’re outside,” she said. “And so being a part of of a project like this, being a part of a community, is just so healing.”
Branfman and other housing activists are hopeful that change could come with measure that’s qualified for the 2024 ballot. The initiative that will go before voters would expand local control by overturning a 28-year-old law that prohibits rent control on single-family homes, condos and rental units that were built after 1995.
After the exhibit closes Saturday, Branfman hopes to find a home for some of the installations at a library or university. Most of it will live virtually on its own Instagram page.
“The rest of it will be on display in my apartment,” she laughs.
SANTA FE, N.M. — Voters are deciding whether to tax mansions to pay for affordable housing initiatives in a state capital city prized for its desert-mountain vistas, vibrant arts scene and stucco architecture rooted in Native American and Spanish-colonial tradition.
The tax on homes sold for more than $1 million is being pitched as a lifeline to teachers, service-sector workers, single parents and young professionals who can’t afford local mortgages or struggle to pay rent amid a national housing shortage and the arrival in Santa Fe of high-income digital nomads and affluent retirees.
The Nov. 7 ballot measure is the latest bellwether for the popularity of so-called mansion taxes to fund affordable housing and stave off homelessness. It comes on the heels of a voter-approved initiative in Los Angeles and new proposals from Chicago to Massachusetts.
If approved, the measure would add a 3% tax on residential property sales of $1 million or more — with no tax on the first $1 million in value.
On a $1.2 million home sale, for example, the new tax would apply to $200,000 in value. The buyer would pay $6,000 to the city’s affordable housing trust fund.
The city estimates that the tax would generate about $6 million annually for the trust, which underwrites price-restricted housing, down-payment assistance for low-income homebuyers and rental assistance to stave off financial hardship and evictions.
The trust awards funds each year to affordable housing providers who can secure matching funds from other government and nonprofit sources, explained Alexandra Ladd, director of Santa Fe’s affordable housing office.
But Santa Fe voters have shied away from prominent tax initiatives in the past, rejecting a proposed similar 1% tax on high-end home sales in 2009 and defeating a tax on sugary drinks to expand early childhood education in 2017.
Second-term Santa Fe Mayor Alan Webber, a Democrat, supports the tax and says soaring housing costs are threatening the “heart and soul” of the city.
“We’re attracting folks who can Zoom to work elsewhere and live in an outstanding place with great climate and culture and history and food,” he said. “We’ve become a magnet, and we don’t want to lose the local community that has lived here all their lives, or for generations, and to suddenly see that diversity give way to only higher-income people.”
The proposal has earned endorsements from an array of local businesses, trade unions, school board members, former mayors and Democratic U.S. Senator Martin Heinrich.
“The housing crisis in this town is outrageous,” said Susan Coulter, a retired scientist, who supports that tax despite concerns about the city’s financial controls.
Cities and states are showing renewed interest in taxes on high-value real estate transactions to address housing affordability, according to Samantha Waxman, a deputy director for state fiscal policy at the Washington, D.C.-based Center on Budget and Policy Priorities.
Voters in Los Angles last year approved a tiered-rate tax on residential and commercial real estate sales — starting at 4% for sales above $5 million — to address housing shortages. Chicago may ask voters next year whether to raise real estate transfer taxes, starting with sales over $1 million, to fight homelessness.
A proposal in October from Democratic Massachusetts Gov. Maura Healey would allow local governments to impose a real estate transfer fee of up to 2% on property sale proceeds above $1 million — or a county’s median home sale price if greater.
“We’re looking at these high-value homes that are being bought and sold,” Waxman said. “Then there’s also these challenges with affordable housing, housing prices increasing in general, and it being really difficult to afford rent and difficult to afford purchasing.”
Perched at the southern end of the Rocky Mountains, Santa Fe is in the midst of a building boom, with thousands of recently approved housing units gradually coming online within city limits since 2021 — including an array of multifamily housing projects.
Advocates for subsidized housing say that hasn’t translated into accessible prices, with most of the new units renting at free-market rates that can strain personal or family finances.
Meanwhile, the city’s median home price has nearly doubled since 2017 to about $600,000, a city-commissioned analysis found.
“People moving here with wealth that far exceeds the buying capacity of local workers, that pulls housing costs away from those workers,” said Daniel Werwath, executive director of New Mexico Inter-Faith Housing, a nonprofit developer of income-restricted housing. “I think we’re into a pretty crazy feedback loop.”
The Santa Fe Association of Realtors says the proposed tax oversteps the city’s authority under state law, and has filed a preemptive lawsuit to block it.
Drew Lamprich, the association’s president, says the change would take a bite out of home sales, and ultimately the local economy.
“There will be folks that decide to buy somewhere else, not liking the divisiveness of this element,” he said.
At a downtown polling place for early voting, retired architect Rita Meek said she fears the tax will increase tensions between relatively wealthy enclaves and predominantly working class neighborhoods.
“I think we should be more united,” she said.
But her husband, Peter Meek, supports the tax.
“We’re losing a lot of our workforce: teachers, police officers, construction labor,” he said. “The people who can afford a million-dollar home should want to help.”
Until a few days ago, Michael Schneider truly believed that his nonprofit, Streets For All, had solid enough political support to pursue what was certain to be an unpopular idea in L.A.: a study of whether it makes sense to rip up a Westside freeway and replace it with affordable housing and a humongous park.
He was a man about town, excitedly touting the letters and statements of “immense enthusiasm” from elected officials.
Like from the office of Mayor Karen Bass, who called the Marina Freeway — a three-mile, lightly trafficked stretch of Route 90 that was left unfinished after a plan to link it to Orange County was abandoned in the 1970s — a “freeway to nowhere.”
And from state Sen. Lola Smallwood-Cuevas (D-Los Angeles), who described Schneider’s idea as “a forward-thinking project that would help alleviate L.A.’s need[s].”
Indeed, as someone who drives the Marina Freeway all the time, I’ve long thought there had be a higher and better use for the land than a mere shortcut from Marina del Rey to the 405 Freeway and over to South L.A. And so I was excited to hear that Streets For All was applying for a federal grant to study it for two years, tracking everything from environmental impacts to traffic to the opinions of nearby residents like me.
Now, though, my excitement as well as Schneider’s has given way to familiar feelings of frustration. True to form for NIMBY-indulging Los Angeles, the political support he believed was solid has suddenly turned porous.
That includes Bass: “I do not support the removal or demolition of the 90 Freeway,” she said in a statement last week. “I’ve heard loud and clear from communities who would be impacted and I do not support a study on this initiative.”
L.A. City Councilmember Traci Park agrees with her. After conducting a very unscientific poll of her Westside constituents, she wrote in her newsletter that: “The 11th District does not support the demolition of the 90 Freeway. Your voice is why Mayor Bass rescinded her initial support.”
L.A. County Supervisor Holly Mitchell told me that, despite rumors to the contrary, she never decided to back a study or tearing down the Marina Freeway, which abuts her district in the unincorporated neighborhood of Ladera Heights. “But it’s a moot point now,” she said.
Meanwhile, Smallwood-Cuevas said she still supports a feasibility study, but cautioned this week that it can’t be at “the expense of transparent community-driven input and analysis.”
Similarly, Assemblymember Isaac Bryan (D-Culver City) said he’s never opposed to research. But there’s a difference between studying the impact of removing the freeway and, referring to several renderings of what Schneider envisions as Marina Central Park, “proposing an alternative design and resolution without a study having been completed.”
Streets for All, a local non-profit is proposing turning the 90 freeway, one of L.A. County’s shortest, and unfinished freeways, into a large public park with nearly 4,000 housing units.
(Courtesy of SWA / Streets For All)
“The 90 Freeway,” Bryan assured me, “is not going anywhere.”
It’s problematic that, at a time when roughly 75,000 people are sleeping in the streets countywide and vehicle emissions are exacerbating the effects of climate change, Los Angeles can’t summon the unified political will even to study — STUDY! — whether to replace a freeway with housing.
Equally problematic is the reason why.
I’m not talking about the blame that some have placed on Streets For All for being overzealous with its messaging and tactics. Or that, according to others, elected officials were too quick to surrender to the fears of their constituents, some of whom wrongly believe the removal of the Marina Freeway is imminent.
I’m talking about the fundamental disagreement in Los Angeles over the role and importance of community outreach. How much of it is enough? How soon should it be done? How much weight should it be given? And to what end?
These unanswered questions are ultimately why political support crumbled for studying the Marina Freeway, and it’s a troubling harbinger.
Most residents understandably want a say — or the say — in what happens to their neighborhood, whether it’s affordable housing on what’s now a freeway or a homeless shelter on what’s now a parking lot.
But given the size of the unhoused population and the scale of the housing construction needed to address it and lower rental prices for everyone else, I increasingly believe L.A.’s political leaders can’t keep putting so much stock in the opinions of residents. Not all development projects that are worthwhile or necessary will be popular.
“For so long, the loudest voices have usually derailed things,” Schneider said. “And all I’m saying is the loudest voices aren’t always the most correct voices.”
::
People don’t like change.
This is a truism that has led NIMBYs to file an untold number of frivolous lawsuits up and down the state of California.
It also has led Gov. Gavin Newsom and the Legislature to repeatedly roll back local control over land use decisions — the latest being a law that lets nonprofit colleges and religious institutions bypass most local permitting and environmental review rules and rezone their land to build housing.
Even Bass, who has made homelessness her top issue, has pushed to cut through red tape and streamline the construction of housing and shelters, trying to extend the pipeline for unhoused Angelenos who have been moved into hotels through her Inside Safe program.
But the mayor said she’s still a big believer in “doing the hard work” of community outreach. She explained why when I shared my skepticism.
“This goes back to my days at Community Coalition,” she said. “We used to fight when the city tried to impose development on South L.A. without including South L.A., which is why you would think that I would say build everywhere, anywhere. But I don’t feel that way.”
Instead, she wants to get people involved in the process and build in ways that are in line with what each community wants.
“If I took a position that said, ‘steamroll everybody, just get housing done,’ we would tear the city apart,” Bass said, adding that residents would likely be against development for no reason other than it was forced upon them.
This is a big reason why she decided against supporting a study of the Marina Freeway. In talking to residents, she told me she heard only complaints — about the possibility of more traffic and longer commutes, and from Black people in South L.A., about losing a convenient corridor to Marina del Rey and the beach.
But most of all, Bass said she heard consternation that there had been no community outreach.
This came up in an online petition that went viral last month — even though it was packed with misleading assertions — written by Daphne Bradford, an education consultant from Ladera Heights who is running for supervisor against Mitchell in the March primary election.
“Ladera Heights is not just any neighborhood; it holds the distinction of being the 3rd most affluent African American community in the nation,” Bradford wrote, channeling her inner NIMBY. “Our community has worked hard to create a safe and prosperous environment for our families, and we believe that our voices should be heard when decisions are made that will affect us directly.”
Schneider sighed when I asked him about the petition.
“The whole point of the feasibility study is we would have almost two years of community outreach,” he said. “We’re a small nonprofit, we don’t have the resources to do the community outreach before getting the grant money.”
In the meantime, rumors about the Marina Freeway have overwhelmed the facts, and many residents have dug in their heels in opposition to whatever they think is happening. Mitchell suspects one reason for this is that Streets For All didn’t “do outreach the way we define outreach.”
The Marina Freeway, an unfinished three-mile stretch of road from Marina del Rey, is one of Los Angeles’ shortest thoroughfares. Now a local nonprofit is suggesting turning it into a large public park and thousands of affordable homes.
(Rendering courtesy of SWA / Streets For All)
“It can’t be 10 a.m. on a weekday, one meeting at the community center,” she told me. “You really have to get creative, partner with communities and not be afraid to reach out to people who will oppose you.”
But community outreach is a thorny issue, Mitchell acknowledges. Again, people don’t like change. And too many people want to “pull the drawbridge up” behind themselves and not let new housing into their neighborhoods.
“When people say outreach, they mean, ‘You didn’t ask me. And then when you asked me, you didn’t do what I said,’” Mitchell said. “That can’t be the expectation. But I do believe that every effort should be made to make sure that impacted communities are aware.”
Eventually, though, everyone will have to get used to the idea that our neighborhoods will look a little different to accommodate the housing that Los Angeles needs.
“These are really difficult decisions that we all kind of have to make,” Mitchell said.
::
Which brings me back to the Marina Freeway.
Despite the Streets For All being abandoned by much of the political establishment in Los Angeles, Schneider said its plan to conduct a feasibility study isn’t dead.
“We live in a democracy. You can’t stop somebody from studying something in the public space. That’s just not possible,” he said. “If we’re awarded the federal grant, we will do it. If we need to raise the money privately, we’ll do it. But we’re committed to exploring the idea because it’s worth exploring.”
Whether that study leads to removing the freeway and building thousands of units of affordable housing in Marina Central Park is another matter.
It’s a huge political decision, Schneider admits. One that will ultimately — undoubtedly and unfortunately — hinge on community outreach. After all, this is L.A.
The Federal Reserve’s flurry of interest rate hikes since March 2022 have taken a toll on home buyers, pushing the typical mortgage rate above 8%, a level not seen since 2000. On Wednesday, the Federal Reserve is set to make another interest rate decision that could impact the home loan market.
The central bank is expected to hold rates steady at its November 1 meeting, according to economists surveyed by FactSet. That comes as credit cards are now charging the highest interest rates on record, and many home buyers have been priced out of the real estate market due to loan costs.
A pause on rate hikes could provide a backstop against higher borrowing costs, yet it might not immediately translate into lower mortgage rates, according to financial experts. That’s partly because mortgage rate hikes don’t always mirror the Fed’s rate increases, but rather tend to track the yield on the 10-year U.S. Treasury note, which recently hit a 16-year high.
“Based on how [mortgage rates] have consistently risen since September, there’s a decent chance that we’ll end 2023 with the average rate on 30-year, fixed mortgages near, or even slightly above, 8%,” said Jacob Channel, a senior economist at LendingTree.
Even so, mortgage rates have climbed this year almost in lockstep with the Fed raising its benchmark rate. Investors’ expectations for future inflation as well as global demand for Treasurys can also influence rates on home loans.
The Federal Reserve has turned to rate hikes as its most potent weapon to battle the highest inflation in four decades. While inflation has eased since last year, Federal Reserve Chair Jerome Powell said last week that inflation remains too high, but he also signaled that the Fed may not need to raise rates again — at least in the short term.
Will mortgage rates go down in 2024?
Still, mortgage rates could ease in 2024, with economists forecasting the Fed could start to cut rates by mid-year, according to FactSet.
“We don’t expect additional Fed rate hikes this year — we think they will pause into next year, and we expect there to be a first rate cut sometime probably toward around the second quarter,” noted Matt Vance, senior director and Americas head of multifamily research for real estate company CBRE.
In the meantime, home buyers are facing an affordability crisis, with home prices climbing along with rates. The national median home price hit $430,000 in September, up from $400,000 in January, according to Realtor.com. Prices have climbed so high that the average down payment is now between $47,900 and $84,983 in the nation’s 50 largest metropolitan areas, LendingTree said in a study this week.
Some would-be buyers have paused their house hunting plans due to higher rates and prices. Meanwhile, many homeowners have decided not to sell their property because they don’t want to purchase a new home at today’s elevated borrowing costs.
Americans may continue to be hesitant to purchase homes next year because of interest rates, analysts at Goldman Sachs said this month.
“Sustained higher mortgage rates will have their most pronounced impact in 2024 on housing turnover,” Goldman Sachs said in a research note this week. “As a result, we expect the fewest annual existing home sales since the early 1990s at 3.8 million.”
The one-two punch of higher interest rates and home prices have caused a slowdown in the housing market this year. Mortgage applications have dipped in recent weeks, according to the latest data from the Mortgage Bankers Association, and existing homes sales fell 2% in September, according to the National Association of Realtors.
Despite those challenges, some Americans were still able to buy a home this year, but “today’s housing market is much less energetic than it was during the height of the pandemic,” Channel said.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
Alicia Glen, founder and managing principal at MSquared
MSquared
Alicia Glen is leveraging her expertise as former deputy mayor of New York City and head of the Urban Investment Group at Goldman Sachs to build MSquared into a significant women-owned real estate development firm focused on affordable housing. MSquared has raised over $200 million in three years—a feat few women have achieved.
Affordable housing is a women’s issue. Women face greater challenges than men in finding affordable housing, which impacts their economic security and well-being. The reasons include the gender pay gap, single parenthood, domestic violence, and homelessness. Providing women with affordable housing makes them more likely to secure stable employment, improve their overall health outcomes, and give their children a better start in life.
Glen’s focus on bringing more capital to build mixed-income and mixed-use projects addresses the housing crisis and breaks barriers for women and minorities in the field.
Sexism Is Alive And Well In Real Estate Development
Women represent more than 50% of the U.S. adult population. Yet, according to Knight Diversity of Asset Managers Research series, they own 2.8% of real estate funds and have 1.7% of assets under management. Firms owned by women perform equally as well as those owned by men.
While it is heartening that Glen has surpassed $200 million AUM, men with equal experience would have raised much more. “I know how hard it was for me to raise, but it would have taken my male counterpart two phone calls,” she said. “If you’re a young woman who’s super smart, trying to raise capital, and you don’t have the kind of long-form resume I have, I can’t even imagine how hard that is.”
One of Glen’s goals is to inspire other women and people of color to start real estate investment funds. She’s not alone. Deborah Harmon and Penny Pritzker began blazing the trail in 2009 when they cofounded Artemis Real Estate Partners and are also trying to be role models, too.
Research in an adjacent sector—venture capital—reveals women and POC face both challenges and opportunities. Limited partners—institutional investors investing in funds—increasingly focus on experienced fund managers. Most women and POC are emerging managers. They are raising their first three funds. Yet research finds that 72% of top-performing VC funds are emerging managers, so women and POC funds are a good bet.
Women represent 37% of the commercial real estate workforce, according to the 2020 CREW Network Benchmark Study: Gender and Diversity in Commercial Real Estate. Systemic barriers that women face include being paid and promoted less. These gaps have a cumulative impact on their ability to launch funds.
“It’s absolutely astonishing how underrepresented women are [in real estate fund ownership],” said Glen. “Women don’t control capital, and they don’t build buildings [in cities].”
After being Deputy Mayor of NYC, Glen took some time off to determine what she would do next.
Thriving Cities Depend On Affordability, Sustainability, And Diversity
MSquared, Pennrose and the Westminster Economic Development Initiative are collaborating with The … [+] Erie Canal Harbor Development Corporation to transform a site into a mixed-income, mixed-use development integral to revitalizing downtown Buffalo.
Rendering by Erie Canal Harbor Development Corporation
Glen grew up on the Upper West Side, where there were public housing projects, Mitchell-Lama cooperative housing for moderate- and middle-income families, and brownstones for upper-income families. Everyone went to the same public schools, had access to Central and Riverside parks, and attended after-school activities at Goddard Riverside and Head Start.
“I grew up in a neighborhood where I wasn’t scared of Black and Hispanic people,” she said. Black, Brown, and white kids went to school together and played together. “I lived on Central Park West, but my parents were public sector employees,” Glen said.
Strong communities are a women’s issue. The well-being of women and girls heavily depends on their access to safe, affordable, and integrated housing. Unfortunately, despite being the heads of 75% of households that receive HUD—Department of Housing and Urban Development—rental assistance, only one out of four eligible women gets this support. This disparity leaves millions of women, especially those from marginalized communities, struggling to secure basic shelter for themselves and their families. Ensuring fair access to affordable and accessible housing is crucial in combating economic insecurity among women.
“Everybody bitches and moans about how there are no women in the real estate business,” said Glen. So, she decided to put her money where her mouth was and launch a real estate development and investment platform focused on mixed-income and mixed-use projects that promote affordability, sustainability, and diversity.
“I have devoted my career to making cities better places to live. I have developed a real sense of what good cities look like and what kind of development we need to continue to make them grow and thrive in a way that makes them diverse, fun, interesting, and prosperous.”
Glen is determined to raise significant money and partner with women developers. To date, MSquared has raised over $200 million. Investors across three funds include Capricorn Investment Group’s Sustainable Investors Fund, Citibank, Ford Foundation, Goldman Sachs, the Skoll Foundation, Trinity Church Wall Street, and Wells Fargo (WFC).
Like women seeking venture capital, women-owned real estate funds lack access to institutional investors such as pension funds, insurance companies, endowment funds, mutual funds, hedge funds, banks, family offices, and sovereign wealth funds.
However, unlike venture capital, real estate is a more capital-intensive business. The owners must put in two and a half percent of the fund. “So you have to also either have made some money or be able to convince your friends and family to support you,” said Glen. “Women don’t have that kind of friends and family network.”
A key to Glen’s success is that she is relentless but has a sense of humor. “You just have to keep going,” said Glen. “You also have to be able to have a sense of humor, or else you will become angry and discouraged.
HOUSTON — The challenges facing Houston’s next mayor are familiar to many big cities: crime, crumbling infrastructure, budget shortfalls and a lack of affordable housing.
But in November’s marquee mayoral election in the U.S., the top candidates promising to turn Houston around are two Democrats who have held power in the city longer than almost anyone, leaving outsiders scrambling to get a foothold as early voting is set to begin Monday.
U.S. Rep. Sheila Jackson Lee took office in 1995, about two decades after state Sen. John Whitmire started in the Texas Legislature. Both have commanded the spotlight and money in the race to lead America’s fourth-largest city, where booming growth has caused municipal headaches but also turned the Houston area into an expanding stronghold for Texas Democrats.
“This (new) mayor comes along at a time when the city is doing well, though the city faces issues,” said Bob Harvey, president and CEO of the Greater Houston Partnership, a local business group.
Ahead of the Nov. 7 election, many of the 18 candidates vying to lead Houston have tried to strike a balance. They highlight what they see as Houston’s failings while touting it as an international city teeming with diversity. They focus on how the city long ago shed its image as a place carved out of concrete where urban cowboys work in the oil and gas industry.
Although the mayoral race is nonpartisan, most of the candidates are Democrats. They are seeking to replace Mayor Sylvester Turner, who has served eight years and can’t run again because of term limits.
With such a crowded field, it’s unlikely any candidate will get 50% of the vote to avoid a runoff.
Others in contention are former head of Houston’s public transit system Gilbert Garcia, attorney Lee Kaplan, Houston City Councilman Robert Gallegos and former council members Jack Christie and M.J. Khan.
People who don’t live in Texas see it as “uncultured” and “dominated by oil and gas,” Garcia said.
“If they came here, they’d see we’re much more. We’re a cosmopolitan city. But we can do better and we should be better,” said Garcia, who has poured more than $3 million of his own money into the race.
Democrats also worry the stakes of the election go beyond picking a new mayor.
A new law signed by Republican Gov. Greg Abbott clears the way for the state to take control of voting in Harris County, which includes Houston, if it determines elections are not properly run.
Voting rights groups have expressed worries that Republicans will seize on problems in the coming weeks, such as polling locations opening late or long lines due to problems with voting machines, as a pretext to assume oversight of elections in Texas’ largest county in 2024.
While crime in Houston, like in other major cities dramatically rose during the pandemic, it has since dropped. Houston Police Chief Troy Finner on Wednesday said crime overall is down 5% compared to the same period last year, with killings down nearly 18%.
Despite the downward trend, Whitmire has emphasized lowering crime.
“Certainly, public safety will be my highest priority,” he said during a mayoral debate Thursday.
The city’s challenges are due in part to its explosive growth over the past decade. Compared to the 20 most populous metropolitan areas in the U.S., Houston ranked third in growth, adding more than 140,000 residents between 2012 and 2022, said Patrick Jankowski, chief economist for the Greater Houston Partnership.
Houston grew rapidly and it didn’t make the needed investments to maintain its streets, water systems and other infrastructure, said Bill King, a businessman and former mayoral candidate who blogs about politics.
Complicating the next mayor’s efforts to deal with pothole-riddled streets will be a potential budget shortfall of up to $300 million.
All of these problems will impede the city’s efforts to invest in its future, one where Houston is trying to move away from an economy tied mainly to the oil industry, said Brandon Rottinghaus, a University of Houston political science professor.
Jackson Lee, whose campaign has touted her experience securing federal funding in Congress, said she’s aware of Houston’s funding challenges to deal with problems like housing and crime.
“What we are going to do is find the most creative way to bring in revenue and put this city right on top with every other great city in America,” she said at a debate earlier this month.
Johnny Mata, a longtime activist with the Greater Houston Coalition for Justice, said he hopes the next mayor works to meet the needs of the city’s poor and underserved but also balances concerns over crime with proper oversight of police.
“There’s so many challenges ahead of us. And, of course, we have to be involved collectively to meet those challenges,” Mata said.
The city’s diversity has long been touted as one of its strengths. Of the city’s 2.3 million residents, 45% are Latino, with 23% Black and 24% white. One in every four Houston residents was born outside the U.S., Jankowski said.
Diversity will be one of the big selling points the next mayor will highlight as the city’s principal salesperson when trying to attract new investment, Harvey said.
“It’s hard to be proud of strip centers,” Harvey said of the nondescript and long-derided shopping centers dotting Houston’s urban landscape.
“But what strip centers allow are an immigrant to come to Houston and open a restaurant or a little retail establishment at a little micro-scale and be successful,” Harvey said. “We built our city around this idea that we welcome newcomers and that we’re building, creating opportunity.”
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Mortgage rates hit 8% on Wednesday, the highest level since August 2000 and deepening an affordability crisis for homebuyers.
The average rate for a 30-year loan touched 8% on Wednesday, according to Mortgage News Daily, which surveys a range of lenders to determine current home loan rates.
Higher borrowing costs — paired with elevated prices — have made home buying unaffordable for a larger swath of buyers, economists and researchers say. In about a dozen U.S. states, families with a median income for their area cannot afford a mortgage, according to recent research from Moody’s. That’s up from only two states in 2019.
“The 23-year high in mortgage rates also goes a long way towards explaining why sellers have withdrawn from the market,” Thomas Ryan, a property economist with Capital Economics, said in a research note Wednesday. “The increase in mortgage costs homeowners would incur by getting a new mortgage to move has stopped many from attempting to move altogether and led listings of new homes for sale to drop by a third.”
Rising mortgage rates come at a time when median home prices have remained elevated for most of 2023. The national median home price was $430,000 last month, up from $400,000 in January, according to Realtor.com.
Still, other groups tracking home loans peg the 30-year mortgage at slightly below 8%. The Mortgage Bankers Association (MBA) said on Wednesday that the typical home loan stood at 7.7% this week, while Freddie pegged the average rate at 7.57% as of Oct. 12.
Impact on home sales
Even high-income earners in cities like Boston, Miami, Phoenix, Salt Lake City and Seattle cannot afford a mortgage under the median home prices in those areas, a LendingTree report released Tuesday found.
“Ultimately, until mortgage rates and home prices both start to show more significant and sustained declines, affordability challenges are likely to persist for high and low income earners alike,” LendingTree Senior Economist Jacob Channel said in the report.
Higher mortgage rates have contributed to the decline in mortgage applications and home sales, according to data from the MBA and the National Association of Realtors.
A group of housing associations this month urged Fed Reserve officials to hold off on additional rate hikes and to take other actions that would help lower mortgage rates. The Community Home Lenders of America, National Association of Realtors and Independent Community Bankers of America also sent a letter to U.S. Department of Treasury Secretary Janet Yellen this month asking for relief.
Rising mortgage rates have made “a significant negative effect on the ability of a family to qualify for and purchase a home, particularly for first-time homebuyers,” the groups said in a letter to Yellen.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
Mortgage rates continue to climb, hitting their highest level in nearly 23 years. The average rate on a 30-year fixed-rate loan rose to 7.49%, from 7.31% last week, Freddie Mac said Thursday. The average rate on a 15-year mortgage rate rose to 6.78% from 6.72% last week.
“Several factors, including shifts in inflation, the job market and uncertainty around the Federal Reserve’s next move, are contributing to the highest mortgage rates in a generation,” said Sam Khater, Freddie Mac’s chief economist. “Unsurprisingly, this is pulling back homebuyer demand.”
Depending on the length of the loan, rising mortgage rates add hundreds of dollars to a mortgage payment. While mortgage rates don’t necessarily mirror the Fed’s rate increases, they tend to track the yield on the 10-year Treasury note.
Rising mortgage rates aren’t the only issue making homeownership more expensive. Many homeowners who locked in a lower rate during the pandemic have opted not to sell out of fear of having to buy another property at today’s elevated rates, thus depleting the supply of homes for sale. A dip in inventory is also acting to push up home prices.
The national median existing home price rose in August to $407,100, up 3.9% from a year ago, according to the National Association of Realtors. The typical mortgage payment hit $2,170, up 18% from a year earlier, according to the Mortgage Bankers Association.
The combination of increasing mortgage rates and a shortage of properties for sale has worsened the affordability crunch by keeping prices near all-time highs. Indeed, those costs have continued to climb even as sales of previously occupied homes fell 21% through the first eight months of the year compared with the same period of time in 2022.
Boston, Chicago, Miami, San Diego and Washington, D.C., have seen some sharpest year-over-year increases in home prices, according to data from real estate research firm CoreLogic.
Home prices have climbed in recent months, but “with a slower buying season ahead and the surging cost of homeownership, additional monthly price gains may taper off,” Selma Hepp, chief economist at CoreLogic, said in a report this week.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
In two German state elections that are seen as a bellwether of the national mood, the far-right Alternative for Germany, or AfD, surged while the three parties that make up the country’s federal coalition government suffered significant losses.
Conservative forces won clear victories in both the states of Bavaria and Hesse. In Bavaria, the Christian Social Union (CSU), a sister-party to the center-right Christian Democratic Union (CDU), is projected to win 37 percent of the vote. In Hesse, the CDU is set to win 34.6 percent of the vote.
But the biggest winner of the night was arguably the AfD, a party that has become increasingly extreme since its founding in 2013. The AfD came in second place in Hesse and third place in Bavaria, according to preliminary results, landmark gains for the party.
The AfD’s strong performance outside its traditional bastion in the states of the former East Germany suggests the party has successfully expanded its base of support. This development has already sparked a renewed flurry of soul-searching among leaders of mainstream parties.
“The increased performance of the AfD can only worry every democrat in this country,” Ricarda Lang, a co-leader of the Greens, said on public television. “I would like to see us move away from finger-pointing and for every democratic party to now consider what we can do to make [the election results] look different again in the future.”
In both Bavaria and Hesse, the three parties that make up German Chancellor Olaf Scholz’s ruling coalition — the center-left Social Democrats (SPD), the Greens, and the liberal Free Democrats (FDP) — all saw their support drop. That outcome demonstrated widespread dissatisfaction with the federal government at a time of growing economic and social insecurity.
The German economy has been stuck in an extended rut, precipitated in part by the surge in energy prices that followed Russia’s invasion of Ukraine. A sharp rise in the number of asylum seekers entering Germany this year and a growing shortage of affordable housing has also fueled voter dissatisfaction.
The AfD was clearly able to capitalize on this discontent. Robert Lambrou, the AfD’s parliamentary group leader in Hesse, where the party was projected to win 18.4 percent of the vote, called the party’s performance in the state “breathtaking.” Many people, he added, “feel that a change in policy is needed. We have high inflation, high energy prices, high rents. We have completely unchecked mass immigration. There is a lot to be done here.”
In Bavaria, the AfD was projected to win 14.6 percent of the vote, just behind the Free Voters, a right-wing upstart party that governs in coalition with the CSU in the state. The outcome means that, in both state elections, the AfD outperformed all parties in Germany’s federal ruling coalition, a scenario that would have been hard to imagine some years ago.
Germany’s ruling coalition had already been beset by infighting, particularly between the Greens and the FDP — parties that are in many ways ideological opposites. The poor outcome for the coalition parties may well make the discord worse, as each party seeks to reinforce its base of support.
In Hesse, a former SPD stronghold, the Social Democrats suffered an embarrassing defeat, winning just 15.1 percent of the vote, according to projections. The loss is all the more stinging for the party because its candidate in the state is Scholz’s federal interior minister, Nancy Faeser, who in a speech called the result “very disappointing.”
With such a poor result, many are now speculating on whether Faeser will be able to keep her job as interior minister. Chancellor Scholz is likely to face pressure to make sweeping changes in order to reverse the fortunes of his party and coalition.
The election outcome was particularly disastrous for the FDP, a junior partner in Scholz’s coalition. The party won just three percent of the vote in Bavaria and five percent of the vote in Hesse, according to projections. The party is in danger of crashing out of both state parliaments if it fails to meet the required five-percent hurdle.
For the leaders of Germany’s federal coalition government, the election outcome has already raised loud alarm bells. The only question is whether there’s enough unity within the coalition to turn the tide.
“Of course, we are not deaf and blind,” SPD Secretary-General Kevin Kühnert said on German public television after the initial election results came in. “All of us together in this coalition should recognize the signals.”
The typical American cannot afford to buy a home in a growing number of communities across the nation, according to common lending standsards, and there’s no clear sign of conditions getting better soon.
That’s the takeaway from a new report released Thursday by real estate data provider ATTOM. Researchers at ATTOM examined the median home prices last year for roughly 575 U.S. counties and found that 99% of those counties now have homes priced too far out of reach for the average American who makes approximately $71,214 a year, according to the report.
Housing experts said a couple of trends explain why prices continue to climb. Interest rates on home loans grew past 7% this year, adding hundreds of dollars per month to a potential mortgage payment. Meanwhile, homeowners who locked in at lower mortgage rates during the pandemic have opted not to sell their home out of fear of having to buy another house at today’s elevated rates.
“The only people who are selling right now are people who really need to move because of a life event — divorce, marriage, new baby, new job, etc.,” Daryl Fairweather, chief economist of Redfin, told CBS MoneyWatch. “That lack of new inventory is keeping prices high.”
The national median existing home price was $407,100, up 3.9% from a year ago, according to the National Association of Realtors. The average interest rate on a 30-year home loan was 7.19%, up from 6.48% at the beginning of 2023, according to Freddie Mac. Prices will remain unaffordable as long as mortgage rates continue to rise, Fairweather said.
“The dynamics influencing the U.S. housing market appear to continuously work against everyday Americans, potentially to the point where they could start to have a significant impact on home prices,” Barber said in a statement Thursday. “We will see how this shakes out as the peak 2023 buying season winds down.”
“First-time home buyers, who are often the most sensitive to interest rates, have had to postpone their home-buying dreams,” said Dan Hnatkovskyy, co-founder of new home construction startup NewHomesMate, told CBS MoneyWatch. “Those older buyers with more cash on hand can buy down interest rates, or they can absorb a higher monthly payment and are still buying homes across the country.”
ATTOM defined “unaffordable” as someone who must devote more than 28% of their income toward paying for a particular home. Factoring in a mortgage payment, homeowners insurance and property taxes, the typical home priced today would require 35% of someone’s annual wages, ATTOM said.
Cities with the most unaffordable homes include Los Angeles, Chicago, Phoenix, San Diego and Orange County, California, ATTOM said. Communities surrounding Cleveland, Detroit, Houston, Philadelphia or Pittsburgh have the most affordable homes compared with median salaries for residents there, ATTOM said.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
For decades, one of the draws to moving to the suburbs included renting a place for less than what you’d find in the city. But that may not be the case for much longer as the price gap between the two is steadily shrinking.
According to new rental property research from Apartment List, rent increases in suburban areas in the early years of the pandemic outpaced price growths in 28 of the nation’s largest metropolitan areas. In the years since, year-over-year rent declines in core cities have fallen faster than suburban ones, minimizing the price gap in average rent prices between the two areas.
Here’s what led suburban rents to surge during the pandemic and why they’re falling more slowly than rents in the city.
Pandemic-spurred population changes
Millions of Americans fled major cities during the pandemic, either to limit their exposure to COVID-19, to be with family, or to find roomier housing in anticipation of remote work. In 2020 alone, some 4.9 million people left their city dwellings to move to the suburbs or rural areas, according to the Pew Research Center.
The influx of people moving to suburban areas sent demand for rentals skyrocketing, along with prices. Rents in the suburbs increased 27% between March 2020 when the pandemic shutdowns began, compared with 20% increases in urban areas, according to Apartment List’s report. Annual rent growth in the double-digits persisted in 2021 and 2022.
Rents in the suburbs of Atlanta; Detroit; Portland, Oregon; Seattle, Washington; and St. Louis jumped between 15% and 21% during that time period, Apartment List said.
“This means that over the course of the pandemic, suburban rent growth has outpaced core city rent growth by nearly 8 percentage points, the highest it has ever been,” the apartment listing website said in its report. “Most of the gap emerged within the first 12 months of the pandemic, but has widened steadily since then.”
To be sure, rent in the suburbs is still cheaper on average nationally than in cities. In Tennessee for example, rents in suburban areas average $375 per month less those in metro areas. In the state of Iowa, the average rent is $895 a month, compared with Iowa City, its largest metro area, where the average rent is $1,120 a month, data from World Population Review shows.
However, that gap is shrinking. While suburban rents on average were 12% cheaper than city rents in 2019, they were only 5.8% cheaper in 2022, Bloomberg reported.
Another contributing factor to higher rents in suburban areas is soaring home prices. The cost of buying a home has grown out of reach for the typical American as mortgage rates have climbed an average 7.2% and median home prices are north of $400,000. The typical homeowner pays $2,051 for their mortgage payment compared to $1,837 a year ago, the National Association of Realtors reported last month.
Those increased costs mean that Americans who could be shopping for a home are instead being forced to live in a rental property for much longer, which also limits the number of apartments available for rent.
Renting a home is still substantially cheaper than buying one, but rent prices continue to climb. Rent for single-family homes rose 6% year-over-year in June in Boston; Chicago; and Orlando, Florida; 5% in Charlotte, North Carolina and St. Louis; and 4% in San Diego and Honolulu, according to data from real estate analytics firm CoreLogic.
Rent at attached properties like apartment complexes are projected to rise faster this year than single family dwellings, Molly Boesel’s CoreLogic’s principal economist, said in the report.
Americans began their shift to the burbs at a time when the nation had a severe shortage of available rental units. By one measure, the U.S. was short 6.8 million affordable rental homes for low-income Americans, according to a March 2020 report from the National Low Income Housing Coalition. The supply shortage helped generate higher rent in suburban areas that continued to climb between 2020 and 2022.
Construction companies have begun addressing the shortage this year, housing experts said. Construction on roughly a million new apartment complexes began in 2023, an all-time high, according to Apartment List. About 520,000 of those complexes will be available for renters this year and the remaining will come on line in 2024, according to CoStar.
“An important factor driving this downward trend in year-over-year rents is the rising rental supply,” Danielle Hale, chief economist for Realtor.com, said in a rent report last month.
Hale and others say rent increases will continue to cool down once more of the units currently under construction hit the market. They point to data from Realtor.com that shows rent prices have dropped for three months straight between May, June and July when compared to a year ago.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
Housing is less affordable than it has been in about four decades. But buying or renting a home might be even less affordable now if it weren’t for the continuing impact of remote and hybrid workers that resulted from the pandemic, according to a recent study by Fannie Mae.
The study, which was an analysis of Fannie Mae’s monthly National Housing Survey, with questions asked among more than 3,000 mortgage holders, owners, and renters between January and March this year, looked at how remote and hybrid work has changed over the past few years and its impact on housing.
More people are willing to move to less expensive areas further away from offices in city centers than a few years ago, according to the report. Continuing remote and hybrid work, at levels remarkably unchanged from two years ago, is enabling people to move toward housing affordability, the study found.
The report also revealed that “affordability” is the most important factor in finding a place to live, both for renters and homeowners.
At the beginning of the year, 22% of remote and hybrid workers said they would be willing to relocate to a different region or increase their commute. Only 14% such workers were willing to do so in the third quarter of 2021, which is used as a comparison throughout the study and was when many workplaces attempted a “return to work” until the Omicron variant of Covid-19 pushed many employers’ plans back that winter.
Workers who are able to break their ties to living in an area because of its proximity to work are able to spread out, reducing the competition for a historically low number of homes for sale that could push prices even higher.
The research showed that among remote workers, all age and income groups have grown more willing to relocate or live farther away from their workplace since 2021. But younger workers — those between 18 and 34 — are significantly more willing than those older than them to live or commute a further distance from their work, with the share willing to do so jumping from 18% in 2021, to 30% in 2023.
“We believe this greater willingness to live farther from the … workplace may be an indication that some workers are feeling more secure about their remote work situation … or their ability to find another job if their current employer were to change its policies,” wrote the researchers, in a summary.
This is good news for remote workers during a time of crushingly low levels of home affordability.
Remote and hybrid work may be here to stay. Or, it’s here long enough for people to buy or rent a new home because of it, the researchers found.
Despite the demands by leaders of some prominent companies that workers need to head into the office or head out the door, the share of fully remote and hybrid workers has remained surprisingly constant in the post-pandemic era, according to the study.
In the first part of the year, 35% of respondents worked fully remote or worked a hybrid mix of some time at a workplace and some time at home. That was only slightly down from 36% in 2021.
While the share of workers going to a work site or office every day was unchanged at 49% in both 2021 and in 2023, the share of people working fully remote ticked up to 14% this year from 13% in 2021.
Homeowners continue to be slightly more likely to work from home than renters. And those with more education and higher incomes are also more likely to have a work-from-home situation, which is consistent with 2021, the study found.
Only 30% of lower-income people, earning 80% of the area median income, could work remotely or hybrid in 2021, and that dropped to 27% by this year. Meanwhile 42% of upper-income people, those making 120% of the area median income, were able to work from home in 2021 and that number did not change in 2023.
Lower-income people — who are in most need of access to lower-cost housing, found further away from a city’s core — are also those least likely to work remotely, according to the survey.
With housing affordability taking a hit over the past few years as rents rose, home prices stayed elevated and mortgage rates soared to a 22-year high, it is not surprising that “affordability” was the top factor for people when picking a new home, at 36%. This was a big jump from 2014, the last time the question was asked, when the top consideration was “neighborhood” at 49%.
Homeowners and renters both showed growth in prioritizing “affordability,” but the increase was greatest among renters, shooting up from 21% in 2014 to 46% in 2023.
“The change in preference for renters is truly remarkable, since not only did it more than double, but it represented a complete reversal of the relative importance of neighborhood cited by consumers as the top consideration in 2014,” wrote the researchers.
In addition, despite the talk about moving for more space, “home size” as a factor for picking a next home was unchanged and still outweighed by “affordability.”
“The striking shift toward affordability as the top consideration among overall survey respondents for their next move substantiates the need of households to find ways to manage around the significant rise in mortgage rates, home prices, and rents of the past few years,” the researchers wrote.
And this is impacting where people look for a home and what they prioritize when they are searching.
“Home affordability may also be a reason why we saw an increase in remote workers’ willingness to relocate or live farther away from their workplace, particularly given that, historically, a shorter commute to denser job markets was considered a premium amenity,” the researchers wrote.
The suburbs are increasingly where people want to be, the report found, which is part of an ongoing trend since 2010. And that share has grown between 2021 and 2023.
The researchers say the change to the housing market brought about by remote workers holds broader implications for the link between housing and the labor market.
The growing share of remote-working renters and homeowners willing to live farther from their work location gives employers access to a wider labor market, which could be useful if a downturn in economic activity led to greater rates of job loss.
“Having access to a larger labor market may also reduce the adverse effect on local home prices when a major employer or industry contracts,” the researchers wrote.
Housing prices have made home ownership for many young LGBTQ+ Americans feel out of reach. But in Peoria, Illinois, the affordable housing and welcoming community have helped many buck that trend. Lilia Luciano has the story.
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On a Wednesday afternoon in March, the Montview Boulevard Presbyterian Church, in Denver’s South Park Hill neighborhood, was packed. The local chapter of the progressive group Indivisible was sponsoring a mayoral-candidate forum. Five candidates had been invited to attend. The moderator asked the usual questions about crime and public safety, homelessness and guns. Then came a question comprehensible only to a close observer of Denver politics: “Do you support releasing the city-owned conservation easement on the Park Hill Golf Course to allow the currently proposed redevelopment of this site?”
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Four candidates raised their hands, a couple only halfway, as if that sign of reluctance might lessen the coming disapproval. It didn’t. The crowd booed.
On April 4 of this year, voters declined to lift the easement. The split was 59–41, not exactly close. Some observers have taken this outcome as a signal that the people of Denver (or, at least, the fewer than 100,000 who voted down the proposal) reject new development. But in that same election, voters sent two candidates who supported the proposal to a mayoral runoff. Back in the 2022 statewide election, almost a quarter million Denver voters supported Democratic Governor Jared Polis, who campaigned on increasing housing supply and dismantling local roadblocks to construction in order to get a handle on Colorado’s housing-affordability crisis. Also that year, nearly 1.3 million Coloradans voted to dedicate hundreds of millions of dollars to increasing affordable housing. In Denver, the measure won 70–30. Deciding “what the people believe” is not so easy.
Colorado is short an estimated 127,000 homes. The Denver metro area alone is short nearly 70,000 homes. The housing shortage is the main driver of the region’s affordability crisis, and housing-policy experts—though they remain divided on many questions—are nearly unanimous in their belief that resolving it will require bringing many more homes to market. From 2012 to 2017, the region permitted only one new home for every 5.4 new jobs; over the same period, home prices in Denver jumped by 50 percent.
When someone who favors new development in theory opposes a specific project near where they live, we call them a NIMBY. NIMBYism is regularly characterized as a case of revealed preferences: Talk is cheap, and support for policies in the abstract is worthless. Voting for a candidate who champions pro-housing policies is one thing; agreeing to new development in your neighborhood is another.
Conflicting desires do not by themselves prove hypocrisy, however. Some people really do want to see more housing in general, even if they don’t want construction next door. The problem is that the local institutions charged with land-use decisions are attuned to parochial complaints, not large-scale needs.
The level of government at which we choose to resolve a conflict shapes public opinion and the eventual outcome. The same question posed at a town hall, at a county-council meeting, in the governor’s office, or by Congress will not be answered the same way in each venue. The tools available, the norms of debate, and the architecture of accountability change drastically from place to place. Americans believe that housing is a local issue. And it is a local issue. But it is also a regional issue, a state issue, and a national issue. By restricting the debate to the hyperlocal level, we’ve blocked out our big-picture values.
Across metro areas, in states led by Democrats and Republicans alike, the same pattern emerges: Local governments decide what gets built and where, and they use that power to ban multifamily housing, entrench economic segregation, and perpetuate a national affordability crisis.
It’s tough to admit, but sometimes NIMBYs have a point. In Denver, I spoke with dozens of community leaders, elected officials, and voters who live near the Park Hill Golf Course. Opponents of the project raised concerns about preserving open spaces, about gentrification, about the democratic process itself.
Former Mayor Wellington Webb told me he opposes developing the Park Hill site because it’s “the last piece of open space, land, in Denver.”
Leslie Herod, a Colorado state representative and an unsuccessful candidate in this year’s mayoral race, also opposes the proposal. She told me she had identified more than 80 underutilized city-owned lots already zoned for residential development where she would rather see housing built.
The Denver city-council member Candi CdeBaca made a version of the “other places” argument too, questioning why development efforts are never focused on wealthy neighborhoods. “We’re not talking about development in places where people have privilege,” she told me. “Those places are protected with their zoning, those places are protected with their level of engagement, those places are protected by the people they have elected to represent them.”
Some voters told me they simply distrusted the process. “There’s no guarantee that if the conservation easement is lifted that the [developer] will honor what they’ve said with creating a park, creating affordable housing,” a landscape architect with an antidevelopment yard sign said.
Of course, no project can solve every problem or skirt every concern. Comparison shopping for umbrellas is fine on a sunny day. When you’re caught in a torrential downpour, it’s wise to take what’s available and run for cover.
For their part, proponents of the Park Hill project, in their eagerness to win votes, tended to oversell what it could accomplish. Some described it as a blow against racism or climate change, or a way to help the working class. In my conversations with the plan’s backers, I sometimes had to remind myself that we were talking about a 155-acre lot, not the fate of the republic.
Land-use regulations and development patterns are a key driver of inequality, pollution, and financial strain. But whether or not the Park Hill plan was approved would have a negligible impact on these larger crises, which will require collective action beyond the scope of any one project. Asking a neighborhood or municipality to bear the responsibility for a housing crisis and its knock-on effects is asking for failure. Local government simply wasn’t built to do this.
Local government is about what you can do for me, right now. Because local officials have a narrow jurisdiction, engaged voters have a direct line to them and significant influence on their decisions. This tight relationship is good for handling issues like broken streetlights and potholes, but it doesn’t lend itself to managing society-wide problems, such as a housing crisis. This is why the political logic of building a lot more housing rarely carries the day at the local level.
Who would have lived in the Park Hill housing development, had voters approved it? No one knows. It could have been a recent University of Colorado at Boulder graduate or empty-nesters from the suburbs looking to downsize. Many of the people who would most benefit from the new housing don’t yet live in Denver—so they don’t have a vote.
Local housing-policy debates are thus asymmetrical. Construction projects have no readily identifiable beneficiaries, but they do levy clear harms, in the form of excessive noise and street closures and changing neighborhood aesthetics.
Just a small fraction of people even engage in local housing fights. Many of those who do are extreme voices or otherwise unrepresentative of the broader community. Look at Fort Collins, Colorado. After more than five years of community engagement, and many months of work by city planners, a 5–2 majority on the city council voted to liberalize land-use policies to allow more housing. But a small group of opponents pressured the council to reverse itself, gathering 6,500 petition signatures—this in a city of more than 160,000. And they won. The council voted again, this time 7–0 to repeal the change.
In interviews, both the head of the Colorado Municipal League, Kevin Bommer, and Denver’s current mayor, Michael B. Hancock, touted regional collaboration as a solution to the affordability crisis. But just as one town cannot ensure that the entire region maintains adequate green space while increasing density, it cannot force neighboring towns to work together to find the right balance. The incentive is too strong for an individual government to say to its neighbor, “You can have all the apartments—we’ll just keep our parks.”
In addition to the Colorado Municipal League, Colorado has several influential regional associations, including the Metro Mayors Caucus and Colorado Counties Inc. Yet greater Denver is still tens of thousands of housing units short of its needs.
The Denver metro area is particularly desperate for small multifamily dwellings (two to nine units) to meet the demand for affordable housing. According to Carrie Makarewicz, a professor at the University of Colorado at Denver, roughly 10 percent of homes in the region meet this criteria. By contrast, 85 percent of residentially zoned land is reserved for single-family homes. By this measure, too, the regional associations have come up short.
Collective-action problems require a body that can hold everyone accountable. Regional associations—which rely on voluntary participation—aren’t going to cut it.
The democratic process begins by defining the democratic body. And when it comes to housing, the body of concern does not end at a town’s boundary line. People moving to the Denver metro area look across the city and into the suburbs for a place to live. One suburb’s opposition to building more housing directly affects prices miles away, because it constrains the supply in a market that spans municipalities. Local governments, in seeking to satisfy local concerns, undermine statewide goals. At least, they do in the absence of state intervention.
State government is also about what you can do for me, but on average: That’s the electoral reality of representing voters across geographic constituencies. Governors and other statewide officials are forced to see the bigger picture because they’re accountable not only to the people who live in a particular community, but also to past residents priced out of and displaced from that community, and to future residents as well. (Nor are newcomers overwhelmingly from out of state, as many seem to believe; census data reveal that about 82 percent of moves happen within states.) Denver’s city council represents the people of Denver, not Aurora, and vice versa. The state represents them all. And in recent polling, 60 percent of registered voters supported eliminating local restrictions to allow for multifamily housing.
The Colorado state capitol is just a short drive from Park Hill and a brisk walk from city hall, but feels miles away from the thrum of local politics. I went there two days after the Indivisible forum to interview Governor Polis. From across a large round table in his office, Polis told me that “housing, transit, travel, roads: These are interjurisdictional issues because really, very few Coloradans live their whole lives in one jurisdiction.” Unencumbered by the need to defend any one project or developer, the governor reiterated a simple point: “Demand has exceeded supply for the last couple decades, and prices have gone up.” Colorado has to “create more housing now.”
Soon after providing that clean summary of what Colorado needs, Polis announced his best shot at providing it. Washington, Oregon, California, Utah, Montana, and Massachusetts have, to varying degrees, pulled authority for land-use decisions up to the state level. Following their lead, he proposed a bill compelling local governments to adjust their land-use policies to meet housing goals, a process that state officials would oversee. The bill addressed climate, infrastructure, and equity concerns; included provisions for increasing and preserving affordable and multifamily housing; encouraged development near transit; and removed onerous parking requirements.
I asked the governor how he would deal with the political opposition to his bill. “People across the board—Republican, Democrat, independent—housing costs is one of the top items of concern,” he replied. I asked again. “People understand that housing needs to be built,” he told me.
Polis’s original proposal was greeted by fierce opposition from local governments, though not because of objections to open space, affordability, or new parking rules. The fight was over where the power to make land-use decisions should lie.
Kevin Bommer, of the Colorado Municipal League, offered a pithy synthesis of local governments’ position: “Respectfully, get off our lawn,” he told me.
I asked Bommer about his policy disagreements with the governor, but he kept stressing the issue of local control. “My members statewide don’t necessarily disagree with a lot of [Polis’s] goals, but to start with saying that the state gets to set a model code and the state gets to regulate and the state will be in charge of land use going forward is a nonstarter,” he said.
Bommer pointed me to an old amicus brief filed in defense of a local moratorium on fracking by then-Representative Polis. It defended local government’s authority over land-use decisions as both a state-constitution matter and a policy matter. Polis wrote that local democracy allows for “widespread citizen input and broad stakeholder involvement,” as well as “more opportunities for public participation.”
The fact that Representative Polis disagrees with Governor Polis is exactly the point. A congressman represents his district; he has little reason to care that local control can harm the rest of the state. A governor has a wider remit. If Polis the representative was right, and localities really are the best transmitters of their residents’ housing preferences, then what explains clear, widespread discontent with the outcomes of those decisions? Colorado’s housing crisis is undeniable, and its land-use authority has rested with local government virtually unquestioned for decades.
Colorado’s legislative session ended on May 8. The bill died in the Senate without a final vote.
Afterward, the governor told me he intends to keep fighting. States that have passed land-use reforms, such as California and Washington, suffered multiple defeats before seeing a first victory. Polis told me he’s frustrated by communities that said, No, we should do it. “The thing is, they’re not doing it!” he said with a laugh. Polis returned again to his central argument: “It’s beyond the capabilities of [local government] even if there’s a city council or mayor with the best of intentions … We have to figure this out together.”
Two citywide votes, multiple lawsuits, and accusations of racism, classism, and harassment that divided Denver. What was the point? The property owner is now promising that the former golf course will become … an active golf course. (This despite the fact that the company has never developed a golf course; its founder told me they’re “doing research on it now.”) Well-meaning objectors judge proposals against a hypothetical better option, but in reality, the alternative to a decent project is often no project at all.
Kelly Brough, who supported the development project and was in the runoff to become Denver’s next mayor, is nevertheless hesitant to embrace state interference. “I can’t say Denver should not control its destiny … I’m just not ready to give it up yet.”
This power struggle is playing out across the country. It’s ostensibly a struggle over housing affordability, but it is also a fight over how we see voters. In polls and interviews, voters express deep empathy for people experiencing homelessness and deep frustration with widespread housing unaffordability. But that’s not the part of us that local government can hear. Instead local politics magnifies our selfish concerns: How will this affect my parking availability? What will this do to my view?
Everyone has a little NIMBY in them. It doesn’t have to be the part that wins.
This article appears in the July/August 2023 print edition with the headline “Local Government Has Too Much Power.”
SANTA FE, N.M. — A tally of the homeless population in New Mexico shows an abrupt jump in the number of people living without permanent housing or with no shelter at all, according to the legislative agency focused on budgeting and accountability.
A spot-count commissioned by the U.S. Department of Housing and Urban Development on a winter night in January identified about 3,850 homeless people, 48% more than a year earlier, a report released Tuesday found.
The count reflected many more unsheltered people — mostly in Albuquerque, where authorities are grappling with encampments on sidewalks and riverside parks.
The change interrupts a gradual, decade-long decline in homelessness in New Mexico, which has the highest poverty rate in the western U.S., according to the nonpartisan research agency.
“Poverty rates are high, labor participation is low. There is high substance abuse rates,” Kathleen Gygi, a program evaluator, told a legislative panel at the state Capitol. “These are all things that compound the problems.”
About half of available shelter beds were being used when surveyed, but some shelters were full and others were hard for people to reach.
The study highlighted a decline in affordable housing as rent increases vastly outpaced personal income growth. Average rents statewide have risen by about 70% since 2017, versus a 15% increase in incomes.
Legislators and Gov. Michelle Lujan Grisham are searching for the best ways to spend $84 million in new state funding to reduce homelessness and boost affordable housing.
The Legislature’s analysis of homelessness and housing found that people in New Mexico stay in shelters and transitional housing for relatively short periods, about half the national average.
But New Mexico’s largest city, Albuquerque, faltered when it came to successfully transitioning people into permanent housing. About 20% of people in the city’s shelters or temporary housing successfully make the leap into permanent housing each year, far below the national average and the 40% transition rate for Phoenix.
A dire struggle with homelessness amid soaring real estate prices was on prominent display Monday at an emergency shelter for men near downtown Santa Fe, just across the street from the city’s thriving Railyard district of art galleries, restaurants, bars and a boutique movie theater.
Scott Snyder, a 67-year-old with limited use of his hands because of a childhood accident, moved into the facility run by St. Elizabeth Shelters in January after his truck broke down and he could no longer sleep in it. He said cheap rental apartments and spare rooms were plentiful when he moved to Santa Fe in the 1980s.
“The affordable rentals are almost nonexistent, they’ve all dried up,” Snyder said.
St. Elizabeth Executive Director Eduard Archuleta oversees two shelters in Santa Fe along with publicly subsidized apartment complexes that support chronically homeless people, disabled adults and low-income families with a variety of support services. The facilities are consistently filled to capacity, he said.
Archuleta says he has been astonished to see professionals with modest incomes but no place to call home turn up in droves to apply for space at the the organization’s 120-unit affordable housing complex that opened in 2021.
“It was a deluge of people and most of them you never would have guessed that they were homeless,” he said.
At Tuesday’s hearing, housing analysts warned that commitments to subsidized rent at hundreds of units may expire without intervention over the next decade. However, the state’s financing authority for affordable housing does support a robust pipeline of multifamily units for low- and moderate-income families.
Isidoro Hernandez, CEO of the New Mexico Mortgage Finance Authority, said more than 50 multifamily projects with 4,300 units are under development or construction across the state.
Native Americans were overrepresented in New Mexico’s homeless population — accounting for 17% of the homeless population and just 11% of the overall population, the study found. That often translates into overcrowded housing.
“We don’t see the homeless because we don’t allow people to be homeless. We will take them in,” said state Rep. Derrick Lente, a tribal member of Sandia Pueblo.
PHOENIX — Alondra Ruiz Vazquez and her husband were comfortable in Periwinkle Mobile Home Park for a decade, feeling lucky to own their mobile home and pay about $450 a month for their lot in a city with spiraling rents.
But now they and dozens of other families have until May 28 to leave the Phoenix park, which nearby Grand Canyon University purchased seven years ago to build student housing. Two other mobile home communities are also being cleared this spring for new developments in a city where no new parks have been built in more than 30 years.
“I’m here, well, because I have nowhere to go,” said Isabel Ramos, who lives at Periwinkle with her 11-year-old daughter. “I don’t know what’s going to happen.”
The razing of older mobile home parks across the United States worries advocates who say bulldozing them permanently eliminates some of the already limited housing for the poorest of the poor. Residents may have to double up with relatives or live in their cars amid spiking evictions and homelessness, they warn.
“Mobile homes are a much bigger part of our affordable housing stock than people know,” said Mark Stapp, who directs Arizona State University’s master’s degree program in real estate development. “Once it’s gone, a lot of people will have no place to go.”
A recent survey by the National Low Income Housing Coalition showed a U.S.-wide shortage of 7.3 million affordable rental homes for extremely low-income renters, defined in Arizona as a a three-member household making $28,850 or less.
Industry groups estimate that more than 20 million people live in some 43,000 mobile home parks across the United States.
“We are in the deepest affordable housing crisis we’ve ever experienced,” said Joanna Carr, acting head of the Arizona Housing Coalition. “Housing for many people is getting completely out of reach. It’s very dire.”
Ken Anderson, president of the Manufactured Housing Industry of Arizona, said trying to bring an old park up to modern standards can be cost-prohibitive for owners, requiring replacement of electrical and sewage infrastructure for newer homes.
At least six such communities have been torn down in Arizona in the last 18 months, he said, adding that Grand Canyon University “bent over backwards” to help residents more than other park owners.
“A lot of these parks are 70 years old,” said Anderson, noting an uptick in demolitions of older communities for redevelopment. “It’s going to be a big problem down the line.”
Efforts under way to revitalize old mobile homes have limits. Despite their name, most aren’t truly mobile, and moving them can be very costly. The oldest homes are often too decrepit to move at all.
The Department of Housing and Urban Development recently announced $225 million in grants to governments, tribes and nonprofits to preserve mobile homes, but the money can only be used to replace, not repair dwellings built before 1976, which are common at older parks.
Vermont earlier this year announced a mobile home improvement program to be funded by $4 million in federal money. It aims to help park owners prepare vacant or abandoned lots for new mobile homes, and help mobile homeowners install new foundations and make their dwellings more habitable.
In Riverdale, Utah, the last of about 50 families at Lesley’s Mobile Home Park must leave by the end of May for construction of new apartments and townhouses.
“The state laws don’t protect us,” said Jason Williams, who sold his mobile home for half what he asked for and will now live in a motorhome.
Some old parks weren’t originally envisioned as permanent housing.
Florida City Campsite and RV Camp was built decades ago for vacationers headed to the Florida Keys or the Everglades.
But the dilapidated park eventually became home to retirees on fixed incomes and young families on government assistance. Florida City, the southernmost municipality in Miami-Dade County, sold it two years ago for a new townhouse project.
Cities often don’t like older parks because unlike other housing they don’t generate property taxes for municipal services. Rundown parks can also be eyesores, depressing the worth of nearby properties even as the value of the land the mobile homes sit on has increased exponentially.
In Phoenix, Grand Canyon University said in a statement it “waited as long as it could” to build new student housing after buying Periwinkle in 2016. ”Now, with the need to expand, the University has raised funds to provide multiple layers of assistance to tenants at Periwinkle.”
The university said it initially gave residents six months to leave, then extended the deadline to 13 months. It offered free rent for the first five months of this year, early departure compensation, relocation assistance and some household goods.
Many park residents are Spanish-speaking immigrants earning minimum wage as landscapers or restaurant workers. There are also retirees living on Social Security.
“We haven’t found anything under $1,800. That’s way above what we can afford,” Ruiz Vazquez said of apartment rents. She said the couple’s mobile home is too old to move and must be abandoned.
“It’s really taken a toll on our health, mental state of mind.”
Maricopa County, home to Phoenix, has a housing shortfall of more than 74,000 units. Zillow.com currently lists the median monthly rental price for all bedrooms and property types in Phoenix at $2,095.
More than 20 families have moved out of Periwinkle in recent months, leaving behind weed-strewn lots. The rusting hulks of several mobile dwellings with rotting wooden stairs were left behind.
Residents wanted an additional 18-month eviction moratorium or a zoning change to stave off their departure indefinitely.
The Phoenix City Council this spring decided to let the eviction proceed, but set aside $2.5 million in federal funds to help mobile home park residents facing eviction in the future.
CEO Mike Trailor of the nonprofit Trellis, who once headed the Arizona Department of Housing, said the organization is working with the university to help Periwinkle families find apartments and arrange to move mobile homes that can be moved.
Still, Phoenix activist Salvador Reza said most families face uncertain futures.
“Some of them might move in with another family, with an uncle or aunt,” said Reza. “Some might go out into the streets and become part of the homeless.”
A new law in Arizona recently increased state funds for owners forced to move their mobile homes because of redevelopment to $12,500 for a single-section dwelling and $20,000 for a multi-section.
Those who must abandon their home because of precarious condition can now get $5,000 for a single-section home and up to $8,000 for a multi-section.
Periwinkle resident Graciela Beltran said it’s not enough.
“They want my house?” she asked, her voice cracking. “Give me a house that is equal to mine. I am not asking for anything more.”
—-
EDITORS: This version corrects that the nonprofit Trellis is working with the university to help Periwinkle residents and was not allocated money from the $2.5 million general fund established by the city.
PHOENIX — Alondra Ruiz Vazquez and her husband were comfortable in Periwinkle Mobile Home Park for a decade, feeling lucky to own their mobile home and pay about $450 a month for their lot in a city with spiraling rents.
But now they and dozens of other families have until May 28 to leave the Phoenix park, which nearby Grand Canyon University purchased seven years ago to build student housing. Two other mobile home communities are also being cleared this spring for new developments in a city where no new parks have been built in more than 30 years.
“I’m here, well, because I have nowhere to go,” said Isabel Ramos, who lives at Periwinkle with her 11-year-old daughter. “I don’t know what’s going to happen.”
The razing of older mobile home parks across the United States worries advocates who say bulldozing them permanently eliminates some of the already limited housing for the poorest of the poor. Residents may have to double up with relatives or live in their cars amid spiking evictions and homelessness, they warn.
“Mobile homes are a much bigger part of our affordable housing stock than people know,” said Mark Stapp, who directs Arizona State University’s master’s degree program in real estate development. “Once it’s gone, a lot of people will have no place to go.”
A recent survey by the National Low Income Housing Coalition showed a U.S.-wide shortage of 7.3 million affordable rental homes for extremely low-income renters, defined in Arizona as a a three-member household making $28,850 or less.
Industry groups estimate that more than 20 million people live in some 43,000 mobile home parks across the United States.
“We are in the deepest affordable housing crisis we’ve ever experienced,” said Joanna Carr, acting head of the Arizona Housing Coalition. “Housing for many people is getting completely out of reach. It’s very dire.”
Ken Anderson, president of the Manufactured Housing Industry of Arizona, said trying to bring an old park up to modern standards can be cost-prohibitive for owners, requiring replacement of electrical and sewage infrastructure for newer homes.
At least six such communities have been torn down in Arizona in the last 18 months, he said, adding that Grand Canyon University “bent over backwards” to help residents more than other park owners.
“A lot of these parks are 70 years old,” said Anderson, noting an uptick in demolitions of older communities for redevelopment. “It’s going to be a big problem down the line.”
Efforts under way to revitalize old mobile homes have limits. Despite their name, most aren’t truly mobile, and moving them can be very costly. The oldest homes are often too decrepit to move at all.
The Department of Housing and Urban Development recently announced $225 million in grants to governments, tribes and nonprofits to preserve mobile homes, but the money can only be used to replace, not repair dwellings built before 1976, which are common at older parks.
Vermont earlier this year announced a mobile home improvement program to be funded by $4 million in federal money. It aims to help park owners prepare vacant or abandoned lots for new mobile homes, and help mobile homeowners install new foundations and make their dwellings more habitable.
In Riverdale, Utah, the last of about 50 families at Lesley’s Mobile Home Park must leave by the end of May for construction of new apartments and townhouses.
“The state laws don’t protect us,” said Jason Williams, who sold his mobile home for half what he asked for and will now live in a motorhome.
Some old parks weren’t originally envisioned as permanent housing.
Florida City Campsite and RV Camp was built decades ago for vacationers headed to the Florida Keys or the Everglades.
But the dilapidated park eventually became home to retirees on fixed incomes and young families on government assistance. Florida City, the southernmost municipality in Miami-Dade County, sold it two years ago for a new townhouse project.
Cities often don’t like older parks because unlike other housing they don’t generate property taxes for municipal services. Rundown parks can also be eyesores, depressing the worth of nearby properties even as the value of the land the mobile homes sit on has increased exponentially.
In Phoenix, Grand Canyon University said in a statement it “waited as long as it could” to build new student housing after buying Periwinkle in 2016. ”Now, with the need to expand, the University has raised funds to provide multiple layers of assistance to tenants at Periwinkle.”
The university said it initially gave residents six months to leave, then extended the deadline to 13 months. It offered free rent for the first five months of this year, early departure compensation, relocation assistance and some household goods.
Many park residents are Spanish-speaking immigrants earning minimum wage as landscapers or restaurant workers. There are also retirees living on Social Security.
“We haven’t found anything under $1,800. That’s way above what we can afford,” Ruiz Vazquez said of apartment rents. She said the couple’s mobile home is too old to move and must be abandoned.
“It’s really taken a toll on our health, mental state of mind.”
Maricopa County, home to Phoenix, has a housing shortfall of more than 74,000 units. Zillow.com currently lists the median monthly rental price for all bedrooms and property types in Phoenix at $2,095.
More than 20 families have moved out of Periwinkle in recent months, leaving behind weed-strewn lots. The rusting hulks of several mobile dwellings with rotting wooden stairs were left behind.
Residents wanted an additional 18-month eviction moratorium or a zoning change to stave off their departure indefinitely.
The Phoenix City Council this spring decided to let the eviction proceed, but set aside $2.5 million in federal funds for the housing nonprofit Trellis to assist Periwinkle and other mobile home park residents facing eviction.
Trellis CEO Mark Trailor, who once headed the Arizona Department of Housing, said the nonprofit is working to help Periwinkle families find apartments and arrange to move mobile homes that can be moved.
Still, Phoenix activist Salvador Reza said most families face uncertain futures.
“Some of them might move in with another family, with an uncle or aunt,” said Reza. “Some might go out into the streets and become part of the homeless.”
A new law in Arizona recently increased state funds for owners forced to move their mobile homes because of redevelopment to $12,500 for a single-section dwelling and $20,000 for a multi-section.
Those who must abandon their home because of precarious condition can now get $5,000 for a single-section home and up to $8,000 for a multi-section.
Periwinkle resident Graciela Beltran said it’s not enough.
“They want my house?” she asked, her voice cracking. “Give me a house that is equal to mine. I am not asking for anything more.”
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