Affordable Housing
What do we mean when we say “affordable” housing?
“Affordable” is a relative term based on a household’s income. What is deemed affordable to one household may not be affordable for the next. The U.S. Department of Housing and Urban Development (HUD) states that households are cost burdened when their housing costs (including utilities) exceed 30 percent of their household income. Given the above, affordable housing is defined as the following: housing + utilities costs that do not exceed 30 percent of a household’s income.
How can I calculate affordability when everyone’s situations are different?
The Hawaiʻi Housing Finance & Development Corporation (HHFDC) publishes income tables every year, by county, that show the definition of affordability based on the number of people within a household, the income of a household, and mortgage interest rates. These inputs provide the numerical definition of affordable rent + utilities or affordable home purchases prices for any Hawaiʻi household’s circumstances. The 2020 HHFDC income tables can be found on the Department of Business, Economic Development, and Tourism website.
What does AMI mean?
AMI stands for “area median income”. This is a term you will likely encounter when viewing resources from HUD or HHFDC. A householdʻs AMI is a numerical definition of economic standing for the purposes of qualifying for programs, subsidies, etc. that varies based on household size and income. According to HUD, a household earning up to 80 percent of the AMI is considered low-income; households earning up to 50 percent of the AMI are considered very low-income; and households earning up to 30 percent of the AMI are considered extremely low-income. It is important to understand what these figures mean because housing legislation is often written using AMI. To convert AMI to US dollar figures (because we know our incomes in terms of dollars and not derive our value from percentages of social standing with respect to a median), the local AMI definitions can be found in the 2020 HHFDC income tables introduced in the previous section.
How many housing units does Hawaiʻi need?
The HHFDC published the Hawaiʻi Housing Planning Study in 2019, which forecasts the need for more than 50,000 additional units housing statewide by 2025. The state-identified need is detailed in Table 32 of the report, which breaks this need apart by HUD income classification (AMI brackets). Over half of the state-identified need is for low-income households earning up to 80% of the AMI. It is important to note this study is simply the state identifying the need, yet the state is not committed to fulfilling the need itself or otherwise ensuring our community’s need is met by the “free” market. Always cite the state’s study when testifying to support affordable housing.
Why is housing so unaffordable in Hawaiʻi?
The oversimplified answer: the high cost of land, real estate speculation, and the treatment of homes as commodities/investments. A person only needs one home that costs them no more than 30 percent of their income as their primary residence, a basic human need. However, people who are trying to meet a primary need have to compete for housing in a “free” market that does not supply enough residential units to meet the demands for basic human needs and commodities/investments. Even if our government enacts policies that stop speculation, the state would still not have enough housing supply to meet the demand for basic-human-need housing. In order to supply enough housing to meet the demand, thereby reducing the cost by a simple demand versus supply economic principle, our community must build more housing.
Do we really need to build more and develop more land?
To ensure the housing is affordable, we need to built smart: we need to build dense, we need to build upward, we need to prioritize the needs of low-income households. Oversimplified: more units of housing on a parcel of land spread the high cost of that land across more households. It is mathematically infeasible to build housing to the needs of our state by developing exclusively detached single-family homes. Even if we could meet our housing needs in this development pattern, doing so has other consequences to transportation and the environment by building ourselves into automobile-dependent lifestyles and requiring more total land.
But, we have a lot of multi-generational households in single-family homes. This is density that is bad for our communities, right?
Wrong. We have overcrowding into single-family homes. The infrastructure and the homes themselves were not designed to accommodate so many people. Packing more people into a residence more than it is designed to accommodate is like using a fork instead of a spoon to drink soup— it is using the wrong tool for the job. However, high-density development would be deliberately designed to effectively use the space to accommodate more people without unintended consequences. Extended families occupying single-family homes is often seen as a “cultural” decision within our community. When people are crowding extending families into homes because that is the only way their families can financially survive in our community, they aren’t really making a choice, our economic conditions are making those choices for them.
What is NIMBYism?
NIMBY stands for “Not In My Back Yard”. This is an attitude in which people oppose development near their place of residence. It is a psychological reaction rooted in the fear of loss, not necessarily the fear of change. Community members who subscribe to a NIMBY ideology should be encouraged to look at how some changes, such as the construction of affordable housing, are a positive change and not a threat or a loss. Often, proposed affordable housing development requires increases in density, and therefore a change in development pattern from what the securely and affordably housed are accustomed. The way our community has historically approached housing is what caused the housing affordability crisis, so we need to change the way we develop to get a better result for our community. NIMBY opposition to affordable housing will often say that they “support affordable housing (just not near me)” and that they are “protecting the community”. The way we protect our community is by building affordable housing; community looks beyond comfort and privilege while welcoming opportunities to prioritize others’ basic human needs.
We should stick to building housing according to the zoning, right?
Zoning is not inherently moral. Building codes are important for public safety. Land use (zoning) policies are important for separating land uses like waste facilities or heavy industry from places where people reside or assemble. However, zoning regulations can contribute to housing unaffordability by preventing land costs from being spread across more units of housing on a given parcel. Zoning can effectively and arbitrarily set the “market price” for land, and therefore housing. Oversimplified: housing that is affordable to low-income households will often need exceptions from zoning regulations to defray the high cost of land in addition to other federal, state, and local subsidies. Zoning is a barrier to increasing the supply of housing, and therefore a barrier for low-income households to share in access to opportunities within our community.
Is it really an affordability crisis if the overwhelming majority of our state residents have a roof over their heads?
Yes. Even if a person has permanent housing but they pay more than 30 percent of their income to cover the costs, they are cost burdened per the HUD definition. Households that are cost burdened consequentially have less room in their budgets for other necessities such as food, transportation, healthcare. The housing cost burdens also affect households’ abilities to repay debt and save money, which inhibits the concept of being able to “pull yourself up by your bootstraps”. Without the stability of an affordable place to live, upward social mobility is difficult to earn no matter how many hours your work or how much you cut household spending. Not all poverty results in unsheltered homelessness; hidden homelessness can take the forms of couch surfing, home overcrowding, living in automobiles, etc. Homelessness is significant consequence of a lack of affordable housing in our community, but we should not wait for our homeless population to increase to do something, nor should we ignore the housing needs of cost-burdened poor people. When you can’t afford your housing, you can’t afford food, you can’t afford transportation, you can’t afford healthcare— you can’t afford to thrive in your own community.
What about homelessness?
Build permanent low-cost housing. It’s quite simple: if someone is thirsty, provide water; if someone is hungry, provide food; if someone is without permanent shelter, permanently shelter them. The distinction on permanent shelter is important; living in and out of homeless shelters does not provide social and economic stability. “They should get jobs”, “they need to go to rehab”, “they need education”, etc. A few things: not all homeless people are unemployed, not all homeless people use or abuse substances. Homeless people need permanent shelter first; the stability of a permanent home can be followed up by social services as necessary according to each client’s needs. This model of addressing homelessness is known as “housing first”. Housing first, judgment never.
How is housing affordability connected to living wage?
The definition of affordability varies for every person/household depending on income. The National Low Income Housing Coalition publishes figures that demonstrate the incongruency between wages and housing costs. A minimum wage worker in Hawaiʻi earning $10.10/hour would be able to afford $525/month in rent. The fair market rent for a 1-bedroom unit is $1,541/month; a 2-bedroom unit is $2,015/month. In order for these fair market rents to be truly affordable (no more than 30 percent of income), a household with one income-earner would need to earn $29.63/hour to afford rent for a 1-bedroom or $38.76/hour for a 2-bedroom. The connection between housing and living wage is simple: supply enough low-cost housing so all minimum wage workers aren’t cost burdened OR pay workers enough so they can afford housing that the “fair market” provides.
How is housing affordability connected to transportation?
Transportation is often a household’s second highest cost after housing. Transportation, whether by personal automobile, public transit, or other modes is at its core a link between housing and employment. When the affordable housing is located far from employment, low-cost and efficient transportation is critical to ensure workers aren’t inadvertently offsetting their affordable housing with unaffordable transportation or lengthy travel times. Low-income workers are more likely to be transit-dependent as personal automobile ownership may be cost prohibitive, therefore, their housing needs should be the priority in transit-oriented development.
Why is transit-oriented development important?
Transit-oriented development (TOD) is a strategy for developing and redeveloping our built environments to be sustainable, multi-modal, walkable, connected, and convenient. TOD deliberately focuses development within short walking distances to high-frequency, useful public transportation. This is a people-focused strategy, acknowledging a need for people to have affordable, convenient access to transportation but not personal automobiles as the first, only, or best transportation option. TOD includes a mix of uses to help reduce reliance on automobiles by siting housing near groceries stores, banks, schools, restaurants, and other services. Housing in TOD is best suited for two types of households: 1) transit-dependent and 2) transit-by-choice. However, TOD can become a wasted opportunity when the housing constructed in TOD areas is unaffordable to low-income households who may already be dependent on transit or likely to choose to use transit instead of retaining ownership of personal automobiles when given the opportunity. TOD areas are often desirable places to live, but the state-identified housing needs (as detailed in the 2019 HHFDC Hawaiʻi Housing Planning Study) clearly demonstrate that our state needs a stronger commitment to ensure low-income households are prioritized in TOD because they are the people who will make such a strategy successful while benefiting from affordable housing connected to affordable transportation.
How is housing affordability connected to environmental justice?
Environmental justice is a people-centric principle. Implied in the definition of affordable housing is the expectation that such housing be safe places to live. The only affordable housing available to low-income households should not increase exposure risks to hazardous materials or pollutants within dwelling units or otherwise pose a risk to public health. As housing pertains to the natural environment, housing in the built environment should be sufficiently supplied and low-cost in development patterns that reduce air pollution (such as TOD) or reduce storm water runoff (constructing high-rise housing instead of sprawling single-family homes). The responsibility to the environment starts with a responsibility to our fellow human beings by having housing that enables greener lifestyle choices in transportation and consumption; we won’t get there without housing that sustains everyone’s needs.
How is housing affordability connected to social justice?
Economic justice is inextricably linked to social justice as policies and actions deliberately turned economic class into a proxy for other social classes (ethnic origin, sex, gender, orientation, etc.). Unaffordable housing has deliberately and passively yet systematically prevented people from social and economic stability, not to mention upward mobility. Affordable housing is first about meeting a basic human need for security. Housing security enables members of our community to focus on other needs, goals, or opportunities and the privileges afforded by shedding the burden of housing costs.
