ANALYSIS: How Many Affordable Homes Does PD 16 Need?
Our housing crises is serious. Boulder, Colorado's, is worse. Boulder's aggressive new approach to the problem has a few things to teach us. And we could teach Boulder, as well.
By Martin Davis
EDITOR-IN-CHIEF
This week, Martin is in Boulder, Colorado, visiting family. He’s also filing reports about Boulder’s own housing crisis as well as the city’s robust news scene — both of which have things to teach Fredericksburg.
Fall is settling into Boulder, Colorado. The temperatures, which had been in the 90s, are dropping. And the towering Rockies lying just beyond the Flat Iron Mountains that border the home of the University of Colorado recently added a first, fresh layer of snow to their peaks.
While the weather is cooling, however, debates about the housing market are growing red-hot.
Boulder has seen home prices rise sharply in recent years. So much so that Fredericksburg’s home prices are — comparatively speaking — a bargain.
Fredericksburg and Boulder are hardly similar localities, of course. Fredericksburg is smaller (less than 30,000 residents to Boulder’s 102,000-plus, of whom about 33,000 are students at the University of Colorado). Also, Boulder has the fortune of having a major research university that drives much of its economy, which is rich in aerospace, biotech, cleantech, IT/software, natural products, and outdoor recreation.
But when it comes to addressing housing issues, the two cities share more in common than might be apparent at first blush.
Fredericksburg is land-locked at just over 10 square miles. Boulder, with almost 4-times Fredericksburg’s population, measures just some 27 square miles. The city of Boulder does sit in Boulder County, which is more than 740 square miles; however, there are significant limitations on that land. From the Boulder Reporting Project:
The city is largely surrounded by protected open space, which is off-limits for development. Height limits restrict the city from building up. And most of the city’s residential land is zoned as low density, requiring a minimum lot size of 7,000 square feet for each housing unit. This limits the number of homes that can be built on the city’s already scarce developable land.
Not surprisingly, both cities are struggling to address their respective housing crises, which are crippling each city’s ability to attract middle-income families who both fill essential jobs (teachers, first responders, small business owners, and more) and generate the type of growth a city needs to remain healthy and growing.
However, Boulder has taken some steps that Fredericksburg — as well as Spotsylvania and Stafford — could learn from. And Boulder could learn a thing or two from Planning District 16, too.
Knowing the Cost
Last week, the Denver Regional Council of Governments’ board of directors released a report detailing specifically how much housing Denver and its surrounding areas would need.
This report, the “Regional Housing Needs Assessment,” involved two steps.
The first analyzed regional data to identify gaps in housing supply and affordability across income levels and household types. The second involved extensive engagement with those involved in various sectors involved in housing to identify systemic barriers to sufficient housing development that meets the needs of people of all ages, incomes and abilities.
The results provide a target for what new housing development is necessary to lower costs and meet the needs of citizens who occupy middle and lower-income positions.
For the city of Boulder, the numbers were eyebrow-raising, if not unexpected. From the Boulder Reporting Lab:
The City of Boulder will need 10,700 additional housing units over the next decade to meet demand while preventing rent and home prices from rising further out of reach for most people… This would represent an approximate 23% increase in the city’s housing supply.
Ideas for how the city can proceed are bubbling.
Among them are updating “zoning rules in Medium- and low-density neighborhoods,” BRP reports, “reducing minimum open space requirements for duplexes and triplexes” and allowing people to sell their Accessory Dwelling Units.
None of these changes, of course, will come easily.
For example, this past week the Boulder County commissioners imposed a moratorium on larger homes. The idea has been in the air since August. The moratorium will last for six months and will begin in January 2025. “The goal,” reports the BRP, “is partially to allow county officials time to develop new regulations aimed at reducing housing costs and environmental impacts linked to large homes.”
Unsurprisingly, the move has both supporters and critics, both of whom are making their voices heard.
The new housing report the city now has, however, that spells out the magnitude of the challenge before it — needing at least 10,700 new homes, most of them affordable — should bring some clarity to what it needs to do as it plans for the future during the moratorium period.
Planning to address the affordable housing crisis is, and has been, underway in our region. The 2020 Housing Affordability and Action Plan identified a number of the most pressing issues that our area faces as regards housing. Among the major takeaways:
One in two renters in the region are cost burdened. An overwhelming majority of those cost-burdened renters are low- and moderate-income households.
There is little rental housing that is dedicated to low- and moderate-income households in the region. Only 7% of all the new homes built in the region over the past decade use public assistance to provide below-market rate rents.
The price of homeownership continues to increase as supply dwindles. Over the past five years, the price of a home has risen nearly 20%.
First-time homebuyers are being priced out of the market. As of June 2020, 1 in 5 home resales were below $250,000 in 2020. Of all new construction sales in 2019 and 2020, only 3% were below $250,000.
Homebuyers are looking for homes that aren’t being built. The average new home constructed is over 3,000 square feet, but the highest demand is for smaller homes.
Senior housing needs will be a significant portion of future housing demand. One in five residents in the region will be 65 years or older by 2040.
A great deal has changed since that study, of course. The median rent for an apartment in Stafford County at that time was $1,543. Today, that number has soared to $1,793. A 16% increase.
An updated study is underway now, according to Kim McClellan of the Fredericksburg Association of Area Realtors. She tells the Advance that this will be “a housing gap analysis to examine how local resident wages match up to our current housing stock and identify what we are missing. The study will not include recommendations on what to build, just provide the data on where we are at.”
Another positive step in our area has been the development of the Regional Housing Assembly here in Planning District 16. It hosted the first annual Regional Housing Summit in 2023, and it will host the second summit, set for October 24, 2024.
Learning from Boulder
So what can Fredericksburg learn from Boulder, and vice-versa?
Some 30,000-foot ideas include the following:
Fredericksburg and its surrounding counties are doing a sound job on the policy front, but Planning District 16 could benefit from a study that spells out the numbers and types of housing that our area is going to need in the future.
Like Boulder, Fredericksburg needs to become more outspoken about the role inequality plays in the housing issue. The two cities are dissimilar in the inequalities they must face, however. Boulder, which is nearly 80% white, must deal with the realities of income inequality, and a local tax system that raises taxes on more-affordably priced homes as newer homes are established in their neighborhoods. Fredericksburg must face income inequality as well as the fast-changing racial demographics in our region.
Fredericksburg and its surrounding counties have an opportunity that Boulder currently does not — data centers. Colorado pales in comparison to Virginia in the number of data centers it has. With centers coming online in Spotsylvania, Stafford, Caroline, and potentially in Fredericksburg, the region will gain access to a stream of income that may provide some of the financial flexibility required to begin making homes more affordable. To be sure, other needs will compete for those dollars - especially education - but citizens should be petitioning their representatives now to begin coming up with plans for how data-center funding can help ease the crisis our area is facing.
Perhaps the greatest lesson that Fredericksburg can learn from Boulder is this. You cannot wish your way out of a housing crunch. Boulder has had opportunities in the recent past to take steps to ease the pain the region is currently experiencing, and has failed to take them.
Fredericksburg, Spotsylvania, and Stafford need to begin taking action now to avoid housing costs like those facing people today in Boulder.
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Mmmm. Food for thought indeed.
But (you know, just because, cause that's what contrarians do...)
Is a $50 a month annual increase on $1500 rent in a time of the worst inflation in a generation (lest we forget, mainly caused by the deficit busting spending of a certain idiot during his last "Presidency" when he was trying to buy every vote he could and after giving welfare to billionaires earlier in his term), and also coming off of a once in a century public health emergency during which evictions were frozen - is that so bad?
Not a good thing, but not exactly "soaring" - more like the natural results of supply and demand in a capitalist society.
And does Boulder operate under the beloved Virginia "Dillon rule" which prohibits and extremely limits what powers localities have to address these problems? If not, economics aside, we're hardly comparing apples to apples here. Other than just listing places where Martin Davis has been recently....
Agreed regarding data center's potential. One of the few advantages this area seems to have is it's proximity to DC, with its information needs only secondary to NY or LA. Might as well take advantage. Though I admit to being troubled as I read of data center's power needs being foisted off on the community. I'm all for capitalism, but only honest capitalism. In our rush to bring in these cash cows who risk being overtaken by technology before they can deliver their promised benefits - I'm hesitant to just write an open ended check. I like my capitalism honest.
Give them a loan, not a gift - and certainly not on the backs of the poor. I'm betting Jeff Bezos can afford it more than that guy with the cardboard sign at the shopping mall.
Finally, a solution I've often wondered why it isn't talked about more in this region, particularly for Fburg - is why reversion is never raised as an option. It's one of the few options that seems viable for a town that is calling itself a city while limited by Richmond from being able to grow.
Clifton Forge did it. Martinsville tried it, but stopped the process to allow a referendum of it's citizens to decide. Looks like a fellow named James Sherlock did a pretty good analysis and argument for it a few years back on a site called Bacon's Rebellion.
Why is that not being seriously bandied as a solution of some of those limitations?
Anyway. Till next time....and if you're in the area, visit Mesa Verde to see some folks who really had housing limitations yet were innovative.
In your comparison of Fredericksburg and Boulder you did not mention community character. In the case of Fredericksburg its unique historic small town character. How should that be considered in the discussion of affordability? How does losing that character affect the future viability of the city? Last night a member of the council stated that he had real concern that historic designations increase property values. A strange comment when one looks at the number of older smaller homes being replaced with significantly new larger homes in the city. Do you agree with this view? Do you also believe that density is the solution for affordability? Are there not other significant factors affecting affordability in this region?