Why ‘Affordable Housing’ Programs Don’t Work

By Seth Grossman, Political Columnist
Published in Current Newspapers of Atlantic County on January 17, 2007.
???? ?We have all sorts of “affordable housing” programs in New Jersey.?? We have?”public housing authorities” that pay top dollar for houses and apartments that are?sold or rented out for a fraction of the cost.? (Federal and local taxes pay the difference.)?? Many towns attract private low income and senior housing projects by offering reduced property taxes.? (Everybody else in town pays higher taxes including stores that pass the higher cost to their customers.)

www.libertyandprosperity.org or contact Somers Point attorney Seth Grossman at Grossman@snip.net or 609-927-7333.

?Every town has its share of?Section 8 programs that pay sky high rents to landlords, while low income tenants pay only a small portion of the? rent–25% of their? incomes.? (Our taxes pay the difference.)?? And many towns like Galloway, Upper Township, and Ocean City have? COAH (Council on Affordable Housing)? or their own zoning restrictions.?? They force builders to sell some of their homes at ?below market? or ?affordable? prices.?? (The builders, of course, make their profit by jacking up the prices on the rest of their homes.)

?Government “affordable housing” programs are expensive frauds.? The government projects are designed, built, and financed by “political”?lawyers, architects, builders, and banks.? The agencies are stuffed with patronage jobs.? Non-government builders spend fortunes on lawyers, planners, political payoffs, and years of delay to get the?approvals, financing, and tax abatements they need
Because it is so expensive to build each “affordable” home, the government can’t afford to build very many of them.??? Only a handful of?the folks who need “affordable” housing are? “lucky” enough get it.????

?Fifty years ago, we Americans spent about a fourth of our incomes on housing.?? Today,? housing gobbles more than?half our incomes.? This is messing up our country in many ways.?? Many 20 and 30 year olds, including kids who should be married or otherwise on their own by now, are still living with their parents.?? Many young parents are not spending enough time with their small? kids because they are working too long and too hard to pay mortgages and taxes they can’t afford.??? Many seniors who met their retirement goals, are still working so their kids can buy houses.??

?By the way, houses are not expensive.?? You can buy a? nice 25 by 60 foot double-wide mobile home for about $60,000.?? You can build new,? three bedroom pre-fab 2,000 square foot homes for about $90,000 each.??? If you could find a piece of ground for $25,000 in South Jersey, you could have an “affordable” home for $85,00 to $115,000, without costing taxpayers a dime.

?But of course, you can’t.? You can easily spend $25,000 just for approvals (pinelands, wetlands, planning, etc.) and hook-ups (water and sewer).? It costs $70,000 for a vacant lot in middle of nowhere in Weymouth.? That same lot would sell for $120,000 in Northfield or Egg Harbor Township.? If we are serious about affordable housing in New Jersey, we have to bring down the costs of land, approvals,? and permits.

?That can be done with the stroke of a pen.??? You simply change the zoning, planning, and pinelands/wetlands laws to allow more building lots.?? If you want to preserve open space, just enforce our immigration laws, and remove New Jersey’s 372,000 illegals.?? Illegal immigration is the only cause of population growth in New Jersey today.?? It is the major cause of urban sprawl and rising housing costs.

?But no politician would do any of that.? Most New Jersey voters don’t really want affordable housing in their towns.??? The folks who already own their homes want prices to keep going up.?? So does the real estate and mortgage industry.??? And most folks who already own homes want home prices in their neighborhoods to stay high to keep out? the “riff-raff”. And nobody wants to build new housing for families with kids in their towns.? It costs roughly $15,000 a year to send a kid to public school.?? So why would any town want to allow new? $100,000 homes that would each house two kids??? The town would only collect less than $3,000 a year in taxes, but? would pay out $30,000 a year for school tuition alone.

?And so we play this game.?? We support expensive “affordable housing programs” that never work.? We support Habitat for Humanity even though building one affordable house every year or two is like putting a band-aid on a brain tumor.? We pretend we really want housing to be affordable again—but that’s the last thing most of us really want.? How else can you explain what we are doing?

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