The Urban Habitat: From the Frontlines of Affordable Housing
by Veronica Jauriqui
For the first time in its 34-year history, the nonprofit Habitat for Humanity joined the ranks of the most prolific homebuilders in the United States, ranking No. 8 according to an industry list published recently by Builder Magazine.
Blame it on the down economy or on the deflated housing market, both of which have withered the U.S. construction industry to depressing levels, but while the nation’s largest homebuilders—like D.R. Horton, KB Home and Hovanian Enterprises—have scaled back, Habitat has managed to make it a record-setting year. In FY 2009, the organization built, repaired or renovated more than 61,000 homes internationally, and more than 6,200 in the U.S. alone, according to its annual report. And its reach is extensive: 64 countries and all 50 states.
This is no small feat for a charity that relies intensely on volunteers and donations to further their cause of affordable home ownership. But that the nonprofit could outperform its for-profit cohorts speaks to how critical its mission is in our time. A dismal report recently released by the U.S. Department of Housing and Urban Development found that close to 13 million people are currently facing an affordable housing crisis (meaning they pay more than half of their income for rent, live in substandard conditions, or both). And one-third were families with children. The Wall Street Journal reported last June that one out of four people cannot even afford a median-priced home in their own neighborhood.
These are nationwide statistics, of course. In Southern California the inflated housing market, dense urban enclaves, higher costs of living and lack of available space make the prospect of affordable housing intriguing (if not miraculous). Habitat is a major player in SoCal’s affordable housing dilemma, with 15 chapters from Ventura County to the Mexican border.
I had the chance to sit down with someone who has a keen understanding of the housing crisis here in Los Angeles County when I talked with Sonja Yates, executive director of Habitat’s San Gabriel Valley (SGV) affiliate. The SGV Habitat for Humanity services the 31 communities of northeast L.A. County—from Highland Park and Sunland to Azusa and Irwindale. In their 20 years, they’ve constructed more than 54 homes in 10 housing developments in Glendale, Monrovia, El Monte, Duarte and Pasadena. Habitat families are chosen after a lengthy vetting process, and it’s no free ride. They give a down payment, make monthly mortgage payments and are required to invest hundreds of hours of their own labor—sweat equity—into building their home.
SGV Habitat isn’t immune to the same challenges plaguing most nonprofits that rely considerably on foundations for support. But unlike many charities, their donations of goods (equipment and supplies) and services have come from those in the construction industry—many of whom are out of work. Still, in 2010, the San Gabriel Valley affiliate hopes to break ground on its Geneva Street project in Glendale, which will make it the affiliate’s first “green” build.
Q: Tell me about your affiliate’s work in creating green and sustainable affordable housing. What have you learned?
Yates: It’s something I’m still learning. The Geneva build will be our first official green build. It means three different things, really. First that we’re using renewed and renewable building materials, that recycled materials are used in construction. Second, it requires energy efficiency—the tightness of the heating ducts, for example. If they’re not tight enough then when you run your furnace in the attic there will be wasted energy. Then it means the types of products we use, such as water-conserving toilets, hot water heaters, et cetera.
Q: Won’t this make it a more expensive construction project?
Yates: These products can be more expensive. However, for our recent Kenwood build we had a donation of toilets from Toto, one of the more water efficient toilets on the market. You can do a half flush or a full flush, for example. This is an area where we are seeking donations. We already have a full donation of solar panels which not only are part of the green materials we use, but will actually save the home buyers on their energy builds.
Q: How have you been affected by the down economy and the bursting housing bubble? Has it been challenge, or are you looking at this as an opportunity?
Yates: Probably both. For us, it’s been a tale of two cities. Many homebuyers are dealing with sub-prime mortgages, rising interest rates and falling home prices. But no Habitat homeowner has lost a home due to the down economy. Why is that? At Habitat, we charge our homebuyers only the actual cost of the home. We have to make sure that the monthly outlay for monthly housing costs fits within the guidelines. We are the only homebuilder that sells homes with mortgages that have zero percent interest.
Q: What about challenges?
Yates: The down side has been two dimensions. When the economy tanked, funding from foundations came to a screeching halt. Foundations lost about 30 percent of their corpus and when you have that big a loss your natural reaction is to stop what you’re doing. There’s also been a significant delay of funding availability. Our partners who are homebuilders and were able to contribute in-kind materials or pro bono services to our builds have also dried up. They’re not building so they can’t give. And as you know, so many workers in that industry have been unemployed.
Q: What about the challenges to building in an urban environment? How about in Southern California?
Yates: We’re different from most Habitat affiliates in that most of our work in the San Gabriel Valley is considered “in fill.” Small lots in already developed neighborhoods. In Glendale, every one of our builds has been like that. Another dimension is the cost of land. Habitat affiliates in the center of the country, say, in Tennessee or Kentucky, might have to pay about $5,000 for the cost of the land. Even at the subsidized price, the portion of the land for each of the condominiums on Kenwood Street [in Glendale] was $110,000, but the actual cost was more than that. So land cost is one of the things that is really a challenge and why we need municipal partners to make that happen.
Q: Are cities generally receptive to your effort?
Yates: We are required to build where there is greatest need. Our service territory is chartered for 31 communities, so it isn’t hard to find a place that has a need. Cities like Glendale are stellar leaders in making affordable housing available in their city.
They also look at it from the standpoint of what our families give to the community. The Pacific Avenue build [in Glendale] was in a once-blighted neighborhood. There were drug and crime problems and it was adjacent to a school. The city purchased the homes, tore them down and gave us the land to redevelop. We made it available to four wonderful families whose kids do very well in school.
And when you look at it from the perspective of what it does for children, children have a place to call their own. When I worked as an educator, there were many youngsters who needed extra help with reading or something. They’d start to improve and then the family would move because they couldn’t afford the new rents, or they got evicted. Having a home where low-income families can stay for years really enhances the prospects for their children’s future.
Q: Have you found that affordable housing developments are stigmatized in some communities? Are most neighborhoods open to the idea?
Yates: We haven’t had much controversy over that. What’s helped is that the communities realize that we do a good job. The homes are beautiful and our families are exceptional – you’d be lucky to have the as your neighbor. When people see all of it coming together, there’s nothing to complain about.
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