When Lee Walker Heights was transformed from 96 apartment units into a subdivision of 212 units, it was a prime opportunity for Asheville to convert these units from subsidized housing apartments into affordable condominiums that qualifying low-income residents could buy. This would be a win-win for residents and the city.
More people would enjoy the benefits of homeownership, and they would pay less for mortgage payments and ad valorem property taxes than many people currently pay for rent. The city would benefit by (1) selling the condos and getting repaid most or all of its investment and (2) using the sales proceeds to fund other housing options.
This would be preferable to pushing more “bonds” on taxpayers. Bonds simply lead to increasingly expensive property taxes, which ultimately make housing less affordable.
Granted, people would need to qualify for a mortgage, but there are housing grants available, and Federal Housing Administration loans available that finance up to 100% of the purchase price. The city might also contribute or waive the down payment, such that a mortgage company would be willing to provide financing for the units. How many people would be willing to work harder or clean up their credit score if they knew buying their own home was a viable option?
According to dwellics.com, in 2022, the average cost of a one-bedroom apartment in Asheville was approximately $1,474 per month. As a hypothetical, if a two-bedroom, one-bath condo unit sold for $200,000, a 30-year mortgage financed at 5% interest would result in a monthly mortgage payment of $1,073.64. If $125 per month were added to the mortgage for estimated property tax, homeowners insurance and homeowners association maintenance fees, the monthly housing cost would still be under $1,200 per month.
This is affordable for the average individual or family earning $3,600 a month, or $43,200 a year. If an individual wanted to sell their unit within a certain time frame, there could be a mechanism in place to keep it affordable. One example would be that they could only sell it for an amount sufficient to recoup the principal that had been paid on the mortgage.
People would take better care of the units if they owned them. They would also care more about their neighborhood being free of drugs, crime and litter.
Instead of borrowing money (bonds) that is given to investors, perhaps the city could invest directly in its citizens.
— L. Cash
6 thoughts on “Letter: A creative solution for affordable housing”
Would not work. Those folks would sell, because that is what you ultimately do when you own. Those prices would be market rate, and you are back to the beginning. Those units fall permanently out of affordability.
Note that the article suggests a “mechanism” for keeping the condo affordable. Such a mechanism could be that the condo could only be sold back to the city to go into affordable inventory, and the seller could sell the condo only for an amount of sufficient to recover their principal investment. There could be restrictions on making it an STR. The idea is the condos would be for working class/low income people, not those who are unemployed or underemployed. A better analogy would have been to compare the cost of renting a one bedroom apartment versus buying an affordable one bedroom condo, say for $150,000. $150,000 financed at 5% interest over 30 years would result in a monthly mortgage payment of $805.23 . Much less expensive than renting!
market solutions are not supported by the electorate. no.
In communities where people really know they wish to live long-term, such a plan (could) work. I’d love to see such a plan to help with first-time owner-occupied home ownership, especially one that helps teachers and law enforcement officers purchase homes and put down roots. I’d even sell my rental to one of these people at a fair price. The trouble in highly desirable places such as ours is that it’s yet another thing we can’t easily control (i.e. the person who buys my place could just turn it into a short-term rental and quit their teaching job). Similarly, we won’t be able to manage the many ways that people can and will game their taxpayer supported ‘affordable housing’, which is just one of many reasons why I voted against the bond.
People in public housing are not earning $43,000 annually.
And the evidence is they care that they are victims of crime in too many cases.
Creative solutions are great. But reality is a factor.
Housing Authority should be forced to fund and supply their own 24/7 police force ! Decades of spineless city councils and mayors have avoided this and there is ZERO accountability from HACA to the citizens of Asheville…it’s our biggest problem and David Nash should be ashamed to show his face !