Who lives in affordable housing?
One mother of three works at a local burger joint. Another is a student. Another works as a nursing assistant, caring for the elderly. Another is a truck driver whose wife has gone through a series of surgeries and whose son is disabled. They are all people I enjoy visiting with, people with great talents. All pay their rent on time. I can’t remember the last time one of them had the police called on them or created a major problem.
Think about the reality of what affordable housing is in Cedar Rapids. If a family of four has a combined income below $63,900, they are at 80 percent of area median income. This qualifies the family to be an affordable housing tenant.
So, it bothers me when people throw out stereotypes of “low-income” renters or rally around keeping “affordable housing” away from their properties. This is sometimes a kneejerk reaction without a lot of thought behind it. In reality, if people could meet our renters and homeowners and hear their stories, they’d rally around supporting them.
Matthew 25 participated in the recent affordable housing bus tour because it is important that people begin to understand the value and necessity of diverse, mixed income neighborhoods where affordable housing is a sought after asset. Our goal is to have residents throughout the region embrace affordable housing.
Once people understand who is living in affordable housing, they often begin to ask about the level of subsidies required to build this housing. People wonder why taxpayers should help subsidize apartments and houses.
From a neighborhood revitalization perspective, subsidies are needed to cover the gap between what it costs to build a home and its resale value. Let me give you an example in round numbers. On average, it costs Matthew 25 $150,000 to build a new 1,100 square foot home in a core neighborhood of Cedar Rapids. In reality, if the homeowner decides to sell the home in five years they will probably receive no more than $125,000. This leaves a $25,000 gap between the cost to build a home and its resale value. A similar gap would be present in building new apartments. So a $25,000 subsidy is provided to help cover the gap.
The more affordable we want the housing to be, the larger the subsidy necessary. A single mom with three children who is earning $25,000 needs a much larger subsidy so that she can live in safe, affordable housing where her children can thrive.
There is plenty of room to debate the system of subsidies for affordable housing. Should it be that we raise wages so that more people can afford market rate homes? Should we let our core neighborhoods deteriorate if the market won’t support new construction within them? Who should receive a subsidy? These are all debatable.
What I would hope we can agree upon is that people living in affordable housing are amazing, talented individuals that help our community thrive. The work that they do is a necessity. I would welcome them as my neighbors.
• Clint Twedt-Ball is executive director of Matthew 25.