Affordable Housing on the Rocks

Sometimes the most complex and fretful issues troubling our bucolic islands need grounding in reality. The over-heated critical area protection issues were keenly distilled down to “you have to be more careful with an island”.

In the societal realm, we are suffering an equally vexing issue; the abysmal lack of decent, affordable housing and rental units. The bumper-sticker is “We get it! The free market is incapable of providing affordable housing on an affluent destination island!”.

Decades of public hand-wringing, ink-slinging and slick planning exercises have restated the metastasizing problem, without progress. We simply can’t continue earnestly stirring a boiling pot of inertia.

Facts. Most island jobs are highly seasonal and service-related at lower wages. Business owners, large and small, are spinning wheels trying to retain serious employees and build their business’ market share. Lower income workers are paying up to 60% of their pre-tax monthly income for sub-standard housing.

Our county ranks worst in the State Housing Affordability Index. In 2016 San Juan real estate sales volume was up 16.5% and the median sale price of previously owned homes climbed to $430,000. On February1,2017 there were no homes listed below $250,000.

There are other models for addressing affordable housing, but those that create permanently affordable units on community trust land through financial subsidies are the most sustainable. The multiplier effect of succeeding owners, thriving in stable housing (some moving up the scale locally), able to pay bills, all contributing in countless ways, is a key to community prosperity.

In the San Juan Community Home Trust model (since 2001), the land is usually owned by the Trust in perpetuity with construction costs subsidized (80% donations/20% grants), enabling carefully screened low to moderate income families to qualify for good mortgages, enjoy stability and successfully build equity. Owners pay property taxes on the full assessed value of land and structure.

A well-maintained home may be sold for a modest profit, but remains permanently affordable forever, under Trust management and protection from the fragile bubbles of real estate speculation.

In the newest Trust enclave on Grover Street, Sun Rise II, five early 20th century homes barged over from Canada, on average cost $350,000 (including barging, renovation, paving, utility hookups, landscaping, etc.) but have mortgages between $158,000 and $192,000 depending on size. Assessed values on each are $50,000 to $125,000 higher. That’s community payback.

Growing competition for substantial grants (that may dry up) and donor fatigue is happening. Without advertising we have a wait list of 30 people. An assessment in 2015 found that San Juan Island alone was short at least 350 affordable housing units.

We know that the most direct path to economic resilience and greater community stability is through increasing permanently affordable housing. On rural farms and in town. County government must provide a sizable annual revenue stream for a reasonable period of time, to break the suction of this crisis. This is our “moonshot”. This is smart capitalism, a wise investment in the future, not welfare.

Steve Ulvi,  San Juan Community Home Trust Board Member

 

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