Home prices seem crazy.
Oregon isn't as crazy as California, but I see the same problem: home prices six and eight times the median household income.
In Medford, Oregon, the median home sale is just above $400,000. The median household income is $73,000 -- a ratio of six to one. In Bend, a pleasant city in central Oregon, the median household income is about $90,000 and the median home price is $760,000, a ratio of over eight to one.
Below is a color-coded interactive map. In places colored in yellow, home prices would require 30 percent or less of household income to pay the mortgage. There is a slider where one can set different household incomes. For the display below, I set it to Medford's level: $73,000 in household income.
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In Medford and Oregon generally, high home prices are caused by structural forces: expensive cost of construction, expensive land eligible for residential construction, and buyers from out of state doing remote work or retiring here. Oregon prices look cheap to Californians.
When I was a county commissioner in the early 1980s, tasked with writing zoning rules under the state's land use planning mandate, most of our attention was on protecting farm and forest land from housing. Housing costs were not an issue then. If you had a job, you could afford a house. Our attention was on protecting farm and forest land from people, people who would complain about farm sprays and smells, and woodlands from people who would accidentally start forest fires and then want fire crews to prioritize protecting their ill-considered home.
Our zoning decisions prioritized "livability," which we saw primarily as protection. Stop sprawl. Stop pollution. Stop building. Stop expansion into new areas.
Forty years later, ironies abound. Our county had the dreaded wildfire that we worked to avoid. It did not take place in the "woodland interface" of housing next to forestland. The Almeda Fire of September 2020 burned over 2,600 homes. It took place in the county's densest urban area, going house to house.
The zoning map we created made it nearly impossible to build housing in areas that are on or near farms. Our thinking was that homes encouraged parcelization and pricing land as homesites rather than farmland. It was well-intentioned. We imagined large blocks of pear orchards that needed protection from complaining neighbors. More ironies: Most pear orchards have been pulled out. In recent decades farming trended toward labor-intensive wine and cannabis crops. Every situation is different but most successful farm operations need workers living on or close to the farm. During the height of the cannabis boom, the public voiced outrage that farm workers were sleeping in tents or the open air, using porta-potties. How unkind to them! There is a reason for that. We had made farm-worker housing, even including RVs as seasonal housing, illegal.
Fixing housing affordability won't be easy. People who live in a neighborhood of single-family homes do not want infill of less-expensive, multi-family housing, Home values depend in significant part on neighborhood desirability, and people oppose change. They support the idea of affordable housing in general -- just not anywhere near their homes.
Land use environmental groups are an influential faction within the Democratic Party. They are preservation-oriented. They successfully stopped incursion of a high-tech factory onto agriculturally zoned land in the Portland area. Environmental groups consider it an achievement to stop housing in farm zones. They think farm workers should live in town and commute to farm jobs. They are protecting farm land, they think. But housing built around "urban centered growth" fails to match the need of farmers and farm workers for housing that is practical and affordable.
What made sense to me in 1983, when we passed the Omnibus Land Use Ordinance that rezoned Jackson County, did not age well on the issue of housing. I got elected as an environmentalist and an advocate of "livability." I still consider myself such. But I have my eyes open to how things have played out over 40 years. One element of livability is that people can afford to live here without being "house poor" or without having huge financial help from parents or the sale of a home in California.
Addressing the housing affordability problem will require a reckoning with zoning rules, land availability, permitting delays, and the need for a broader range of housing types. It requires investment in workforce housing and incentives to build where people work. It will require people to broaden their notion of "livability" and the common good. It will require we change our minds on some things, and that last point will be the most difficult.
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5 comments:
It’s the not in my backyard problem. Seattle needs either a bigger airport or a second airport. The second airport makes the most sense, but three proposals were all fought fiercely by the potential neighbors. So, they gave up on that idea and have gone with expanding SeaTac. Now potential neighbors are fighting expansion of new longer runways.
New houses cost way less in other parts of the country than here. Material costs are consistent throughout the US, while labor costs, regulation costs, and permits/fees vary according to area. It costs $25,000 just for the sewer and water hookups, and school and parks fees to build a new 1,500sf house in east Medford. Then you add in all the various Oregon regulation costs which increases the final housing cost by 25%. Kate Brown required solar to be built into every new house, and that costs money. The government gives lip-service to the notion of affordable housing, yet house prices cost 50% more than they should due to government interference. If you're a home buyer, then the government is not your friend. We've just seen electric utility costs, sewer costs, and home insurance costs skyrocket upwards due to government interference. Oregon government doesn't want you to be a home owner.
Brown Shoes Don't Make It
The Mothers Of Invention
Do you love it, do you hate it?
There it is, the way you made it…
Security, safety, sustainability, energy efficiency, comfort, accessibility, low environmental impact, affordability, durability, desirability, and low maintenance are terms used to describe new home construction to prospective buyers. The buyer is expecting a lot and paying a lot. The community expects new homeowners to pay for the services required: roads, sewers, water, electricity, schools, shopping, police, and fire protection. The more people move in, the greater the impact on local services. Expanding services must be constructed in an inflationary economy, further stressing the cost of construction. For the State of Oregon, the data show that we need to build new homes at a rate of more than 29,000 per year to maintain an adequate supply.
Instead of trying to force “infill“ down the throats of neighborhoods that do not want it, we could be building new satellite cities (connected by fast rail, where appropriate), to create more of the single-family, detached home suburban lifestyle that most people want.
Making housing cheaper requires building more of the kind of housing that people actually want.
Urbanist elites want us to live in “dense” communities; they are apparently too dense to notice that’s not what most of us want.
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