Incentivizing developers to build more affordable housing continues to pose challenges for Greeley officials as home prices keep rising.
On Tuesday, Housing Solutions Director Deb Callies provided the city council with an update on recent efforts to promote affordable housing. The council last year approved a Housing for All strategic plan, an effort to support the development of everything from affordable housing to executive-level housing.
The biggest barrier to achieving that goal is the massive divide between rising construction costs and the price point at which homes can be sold and considered affordable.
City staff asked the council to consider additional funding options, such as a sales tax initiative, a commercial development fee or an allotment from the general fund to provide the resources needed to expand and create affordable housing programs. No action was taken at this time.
Key figures and facts
For a house to be considered affordable, it must cost no more than 30% of the household income. The average median income for a four-person household in Greeley is $113,600, whereas the median cost for a Greeley home is $431,732.
“Unfortunately, the natural market without intervention won’t be able to solve this problem,” Callies said. “As the home prices rise, so does the income level needed. So today, a four-person household in Greeley must make $136,000 annually in order to afford the median-priced home in Greeley.”
The median home in Greeley is affordable only to households making 20% more than the median income. With household costs continuing to rise out of step with salaries, the gulf between what is considered affordable and what homes are selling at will only grow.
“The median-priced single-family home in Greeley is naturally affordable now to 120% AMI households,” Callies said. “A year ago, I said it was 110% AMI households. It’s already increased by 10% AMI points.”
The city needs 463 homes priced between affordable and market rates per year, according to a needs assessment conducted in 2023. To fulfill this need, it would cost about $31.1 million to bridge the gap between housing construction costs and the losses developers would incur if they listed them at affordable prices.
Council comments
Councilwoman Deb DeBoutez asked about annual funding provided by the private activity bonds the council approved on Jan. 6. These bonds are independent funds granted by the Colorado Housing Authority to help construct affordable homes across the state. The city has saved $24 million to be used on different projects to develop affordable housing. One of Councilman Johnny Olson’s concerns when discussing affordable housing is private investment from out-of-state entities buying homes in Greeley and setting market rates above the means of residents. “My daughter put 14 contracts down and only got their last one because it was a friend. The hedge fund groups are buying all the homes. The housing market says it’s $300,000, but she has to go to $450,000,” he said. “I think it’s something that we have to evaluate. I don’t know if there’s anything we can do with that, but I sort of struggle with that.”Staff response
In addition to private activity bonds, the city utilizes programs such as Community Development Block Grants and Proposition 123 programs, which provide down payment assistance and funds for home rehabilitation. Callies said private, out-of-state investment is not something to worry too much about in affordable housing, as protections will be in place to ensure the homeowner occupies the home.Hence then, the article about how to fund affordable housing in greeley city council reviews options was published today ( ) and is available on GreeleyTribune ( Saudi Arabia ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.
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