You can’t win with new housing

I recently read a report from one of Georgetown Law School’s many centers, discussing the shortage of low-income housing in six metro areas with high housing growth. *

The report points out that owner-occupied units built since 2010 are far larger than in the 1980s- 58 percent had over four bedrooms, as opposed to 33 percent built then. Renter-occupied units are smaller- 55 percent of newer units had two or more bedrooms, as opposed to 65 percent of 1980s. One might think that at least the first of these developments is more desirable. Right?

Wrong. According to this report, larger owner-occupied units “continued to be larger, potentially limiting the availability of smaller, lower-cost homes.” (page 12) So does that mean smaller apartments are good? The report states that “lower-income households- especially families with children- are likely left with fewer housing options that meet their needs” (id.) In other words, new housing might be assailed as being the “wrong size” no matter what. If houses/apartments are larger, some will complain that they might be more expensive than smaller units. If they are smaller, some will complain that they aren’t “family-friendly,”

*Incidentally, I am not sure I am persuaded by the overall message of the report. The section most likely to attract attention states: “Lower-Income Households Experienced Greater Rent Growth In Most Areas.” (page 24) This section claims that in six metros with lots of new supply, “lower-income households without a rental subsidy faced larger rent increases than higher-income households.” The report added some bar graphs with three different types of low-income households: low-income, very low-income, and extremely low-income. In one metro (Washington), all 3 categories did better than the rest of the market (that is, had lower rent increases). In two (Phoenix and Houston) all 3 did worse. But in three (Atlanta, Dallas, Seattle) the results were mixed: one or two of the three low-income groups had lower rent increases than the rest of the market and one or two had higher rent increases. This seems much more ambiguous than the center’s characterization of the data. Furthermore, the report does not contrast these metros with those that did NOT have much new housing.