The search for affordable housing

Supply is shrinking and demand is increasing for homes less than $80,000.
Sunday, January 18, 2004 | 12:00 a.m. CST; updated 4:46 p.m. CDT, Monday, July 21, 2008

For nine years, Jean Cribb lived in an apartment at the end of a cul-de-sac in a busy area of northeast Columbia, near Interstate 70. The nighttime traffic noise was tough to take, so Cribb, a single parent of two children, asked a real estate agent to help her find a three-bedroom home in the $300-a-month range.

A year passed, during which the agent showed Cribb just one house she could afford to buy. The house, in the Lake of the Woods area, was a “major fixer-upper,” said Cribb, who has an in-store marketing job with Sears in the Columbia Mall. “It was disappointing to see what my money would really get me.”

Cribb’s experience is just one sign of how housing in Columbia has become less affordable in recent years. A Missourian analysis of data from the Boone County Assessor’s Office and the U.S. Census Bureau shows that the inflation-adjusted median price of a single-family home or condominium rose 17 percent, to $123,860, between 1990 and 2002. Meanwhile, affordable homes — those priced at less than $80,000 — decreased from 20 percent of all homes sold in Columbia in 1998 to 13 percent in 2002.

The definition of affordability is set by the U.S. Department of Housing and Urban Development, based on an area’s median income. In general, a house is considered affordable by HUD if monthly mortgage payments do not exceed 30 percent of the gross income of a person or family earning 80 percent of the local median income.

In Columbia, 80 percent of the median income is about $27,000. A family at that income level would be able to afford a home that costs roughly $80,000, said local real estate experts, assuming the buyer has no other debt and puts a 10-percent down payment on the house.

However, Mary Wilkerson, vice president of marketing for Boone County National Bank, said that it is rare for a potential homebuyer seeking a home loan to not have other debts, such as a car payment, student loan or credit card. A $300 monthly car payment, for example, could place a home mortgage beyond the reach of many people with low and moderate incomes.

Renters also face a growing affordable housing crunch, according to Courtney Herbst, acting executive director of the Columbia Housing Authority. More than 300 very-low income families are waiting for Section 8 vouchers entitling them to government subsidies to help pay rent at private apartments.

Location is important to potential homebuyers, even those whose choices are limited by modest incomes. Most census tracts in the city contain either extremely high or extremely low percentages of homes priced below $80,000, according to the Missourian’s analysis of 2002 home sales data. And those searching for an affordable home in Columbia find that they are largely restricted to certain neighborhoods. The Missourian found that the census tracts with the highest percentage of homes priced below $80,000 are located in an area north of Broadway that straddles Providence Road.

Despite the shrinking supply and increasing demand for affordable housing in Columbia, several proposed affordable housing developments have failed to get off the ground because of opposition from neighbors.

The possibility of increased traffic congestion and a reduction in green space fueled opposition to a proposal by Picerne Development Corporation, a national housing developer, to construct the six-building, 48-unit Parkridge Apartments, across from Ridgeway Elementary School in central northwest Columbia.

Early in 2003, neighbors opposed a plan by Show-Me Central Habitat for Humanity, a nonprofit affordable-housing developer, to build four duplexes for the disabled and elderly at 407 Ridgeway Ave., in central northwest Columbia. The project is still alive, but continues to face opposition from nearby residents. Meanwhile, 350 local families were on a waiting list for a Habitat house late last month, said Vivian Nimmo, Show-Me Central’s executive director.

Neighbors recently opposed the development of Wyatt Lane Acres, 36 single-family homes in northeast Columbia, claiming the project would hurt their property values. John Harpole, president of the project’s developer, Kodiak Resources, said Wyatt Lane Acres was aimed at low- to moderate-income families who would have been given the opportunity to buy the homes.

Opponents’ previous experiences with affordable housing blinded them to the potential benefits of the project, Harpole said.

“They just assumed that everything would be the same,” he said. “They didn’t understand the program.”

Both Wyatt Lane Acres and Parkridge Apartments fell through when the Missouri Housing Development Commission, a public agency that funds affordable housing projects across the state, declined to commit money to the projects. Harpole said that Kodiak Resources, a Springfield-based company that has developed about 500 affordable housing units across the state since 1989, would continue to look for opportunities in Columbia.

“I have just got to find the right location when I come back,” Harpole said.

By some measures, the affordable housing situation in Columbia may not be so bleak. Columbia residents are spending less on housing when compared to the United States as a whole, according to figures from ACCRA, formerly the American Chamber of Commerce Research Association.

In the first quarter of 2002, local housing costs were on par with the rest of the country, at 98.7 percent of the national average. By the third quarter of 2003, local housing costs had dropped to 84.4 percent of the national average. Sherry Wohlgemuth of the Columbia Chamber of Commerce said the ACCRA figures are not completely accurate because the index fails to account for inflation or interest rate fluctuations.

Joe Haslag, an MU associate professor of economics, said the Missourian’s analysis could suggest that what homebuyers can afford has increased. The drop in sales of affordable housing from 1998 is not necessarily a “bad omen,” Haslag said, because housing prices rise as the demand for larger houses increases. And, he said, low interest rates allow buyers to shop for larger and more expensive homes.

A comprehensive account of the affordable housing situation in Columbia could be available soon. Last fall, the city hired J-Quad and Associates, a consulting firm based in Dallas, to do an analysis of local housing trends and needs. The report should be finished next month, said J-Quad vice president Douglas Frederick.

The consultant’s findings could eventually help quench Columbia’s thirst for affordable housing so homebuyers like Jean Cribb have more options.

When Cribb’s initial search for a home failed to bear fruit, a friend told her about Habitat for Humanity. Cribb filled out the applications and went before Habitat’s family selection committee. The process took a few years while Habitat worked to accommodate her wishes, such as having the house face west, but she eventually received approval to build on Haden Drive off Blue Ridge Road in northeast Columbia.

Cribb and her two children, Kasandra Ellis, 11, and Matthew Ellis, 9, moved into a three-bedroom, two-bath house in July 2000. She pays $292 a month, which covers the mortgage, insurance and taxes.

“The kids and I prayed about it every night, ‘Okay, a house we really, really like and that I can afford,’ ” said Cribb, who can look out her kitchen window to see a swing on her back porch and green grass leading up to a wooded area.

Cribb is thankful for her Habitat house and now is on the local Habitat affiliate’s board. She also volunteers on a committee that helps future Habitat home recipients. She wants others to feel the same pride that she has for her new home.

“You know that this is your home,” she said. “And it’s a really great feeling.”

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