Housing costs still outpace income: report

August 22, 2007; As originally appeared in the Greenwich Time by Doug Dalena

STAMFORD -- The gap between residents' income and housing costs continues to widen, despite efforts to close it, a study published yesterday reported.

The study of the supply and demand for affordable housing -- published by the Southwestern Regional Planning Agency -- found that eight southwestern Connecticut cities and towns often nicknamed the "Gold Coast" have become more gilded since 1996, when a similar study already targeted affordable housing as a significant problem.

The supply of government-regulated, moderately priced housing actually decreased between 1998 and 2006, according to the study, even as housing prices shot up and job growth has attracted more residents.

Harrell-Michalowski Associ-ates, the Hamden planning firm that produced the study, examined statistics from Darien, Greenwich, New Canaan, Norwalk, Stamford, Weston, Westport and Wilton. The statistics include the number of housing authority apartments, federal vouchers to subsidize rents in privately owned buildings, units with deed restrictions on their rent or sale price, and private homes with mortgages guaranteed by the state or federal governments.

The region's supply of government-regulated affordable housing units dropped by 11 percent between 1998 and 2006, though much of that drop came with the demolition of the Stamford Housing Authority's Southfield Village complex. The crime-riddled, crumbling complex was replaced by a lower-density, mixed-income development seen as a showpiece of the federal government's HOPE VI revitalization program, which replaces outdated public housing.

Since then, Stamford has passed an ordinance requiring developers of multifamily housing to include affordable units in each project. The ordinance was passed in 2003, but units created under it have just begun to be occupied in the past two years. According to statistics from Stamford's land-use bureau compiled in July, about 85 units have been built, with another 47 under construction. Another 200 have been approved, but not built.

"I'm pretty satisfied with what we've been doing," Mayor Dannel Malloy said.

Stamford's own affordable housing study, completed in 2001, found the city needed 8,000 affordable homes to keep up with job growth.

Still, the strides made in the past several years have set the stage for much more affordable housing production, according to Joan Carty, executive director of the Housing Development Fund, a nonprofit affordable housing lender and advocacy group.

"The delivery ... is going to be really much easier now that the infrastructure is in place," she said.

That includes inclusionary housing ordinances such as Stamford's and one passed by Norwalk in January, increased participation from banks in affordable housing lending, and a recent focus by state and regional leaders on creating more housing near transit centers, something the new SWRPA study recommends.

"Higher density, which is considered such a bad thing in some parts of the county, is actually considered more acceptable in transit hubs," Carty said.

At the same time, the astronomic rise in the area's housing market has eroded the supply of affordable rental and owner-occupied homes

Based on 2000 U.S. Census figures, the authors found that only 14.4 percent of homes in the region's towns were affordable for sale to families making about $82,000 -- 80 percent of the area's median income for a family of four. For those earning half the median income -- $51,000 -- only 2.6 percent of the market-rate housing stock was considered affordable, meaning people at that income level would spend 30 percent or less of their income on housing. The percentages were higher if a family could move from one town to another within the region, but the housing market's gains have erased even those opportunities, the study found.

Since 2000, housing prices have essentially doubled in Greenwich, Norwalk and Stamford, but incomes have risen much less -- about 13.5 percent for the region. Sales price increases for all eight towns studied rose 74 percent for single-family homes and 73 percent for condominiums. The study attributed the overall shortage of government-regulated assistance to a reduction in government spending on affordable housing, combined with increased land and construction costs in the urban areas near mass transit and already-densely developed areas where the authors said affordable housing makes the most sense.

"There's just not enough money to build affordable housing, that's why it's not being built," Malloy said. "The two levels of government -- state and federal -- which were responsible for building affordable housing for the last 70 years, have largely withdrawn from the market place.

"For communities that don't want to build it to begin with, that becomes a great excuse."