Tag: affordable housing

Could an Empty Garage Solve Housing Crisis?

That empty garage being used for storage may be the answer to a housing shortage that is ailing markets across the country, housing analysts say. Several communities nationwide are considering lifting zoning requirements to allow more accessory dwelling units or ADUs, which would permit adding extra housing onto an existing home.

California, facing an epic housing shortage, is one state actively pursuing the idea. A recent report from the California Housing Partnership says that the state needs 1.4 million more affordable rental homes to meet current population needs. California lawmakers have been relaxing their laws to allow more ADUs – whether that’s a garage conversion, backyard cottage, an in-law apartment or granny flat that could be added onto an existing home. Calif. Gov. Gavin Newsom has signed a law to urge greater construction of ADUs.

Companies are now stepping in to help. One project under way, called United Dwelling, enters into a partnership with a homeowner and pays for the garage conversion. Once it is converted into a living area, they’ll then manage the rental of the apartment to a tenant and split the rent with the homeowner. The company received a million-dollar grant last year from Los Angeles County to help grow its garage conversions in the area.

ADUs have been regarded not only as a way for homeowners to generate extra income but also as a place for young adults who move back home or aging parents who want to move in. ADUs could also help provide greater affordable housing to low-income populations in need, housing analysts say.

However, one common complaint regarding affordable housing has been the impact to neighboring properties, including having more people living on one property and street parking issues.

“While nonprofit housing developers prioritize multifamily developments, we support ADUs as one of many tools that can help address our housing crisis, given the staggering deficit of units across California for people of all incomes,” Alan Greenlee, executive director of the Southern California Association of Nonprofit Housing, told The New York Times. “Notably, ADUs can help achieve greater density of units in neighborhoods that are primarily zoned for single-family homes.”

College Grads Too Optimistic?

College graduates under 30 strongly believe they’ll live as well as or better than their parents, according to a survey of 21- to 30-year-olds conducted by The NHP Foundation, a not-for-profit provider of affordable housing. Even those saddled with student loans are optimistic about their future financial and housing picture.

Researchers question if their optimism could be overblown.

Sixty percent of college grads surveyed say they fully expect to be able to “afford the kind of housing they most prefer” in one to five years. Seventy percent rated homeownership as “important” to “very important.”
The age group has been labeled “generation rent,” which refers to young adults faced with stagnant wages and high debt who – compared to other generations – are forced to stay renting longer due to the high costs of housing.

Forty-six percent of the graduates surveyed say they expect to live on their own, paying rent with no help from roommates or parents. However, more young adults are living at home with their parents than ever before. For example, in markets like New York, Miami and Los Angeles, as many as 45% of young adults are living at home, the study notes.

More than half of the college grads surveyed say they have student loans – with 10% owing more than $50,000. Nearly 40% say they expect to pay those loans off in one to three years, though. Researchers say it’s more likely it’ll take about 10 years to pay them off. The average bachelor’s degree graduate takes 21 years to pay off loans, the report notes.

College grads may not be completely unrealistic about their finances, researchers note. About 67% did say they expect to spend more than 30% of their income on rent. Most financial experts consider that “cost burdened.”

“We were surprised to learn that 54% of these young graduates know that they could potentially qualify for affordable housing under HUD’s definition,” adds Richard Burns, president and CEO of The NHP Foundation. “This helps us understand how we need to consider housing to suit these renters, who may be in apartments for longer than they think.”