Is There a Housing Crisis

Data

1. Median house cost - $128k Mayville mo. [1].
2. South midwest and south east, at $250k around for median price. [2]
3. Detroit is like 1/3 the average housing cost! [3]
4. Cost of low rent afforded by the poorest people makes apartment operating cost unsustainable? [4]
5. Tax credits apply to those whose income is 60% of median [5]
6. Extremely low income means 30% of median (AMI) [6]
7. Current standard for affordability: no more than 30% of gross income [7]
8. 60% of median rent in Denver is $900/mo. [8]
9. Favela property values are on the rise and speculation + forced removals are in. [9]
10. It costs $10M on average to build a 50 unit apartment. [10]
11. For apartment building - 20% is land, 40% construction. About 50% is capital and soft costs. About $70k/unit for construction, not including land. Average apartment is 900 sf. average $125/sf for construction. [11]
12. Management expenses for apartments are 3-7% [12]. Ex. $25k for a complex that makes $500k/year.

Issues

1. KC situation. Affordable is rent only of $700. [13]. If SEH costs $100k, can we do rehnt at $700/month? Link to a guy building affordable homes, 5 per year.
2. Inclusionary (affordable) zoning - actually increases housing costs? [14]
3. Essential conflict of interest between big builder profits and affordability? [15]

Solutions

1. Habitat does CEO Builds - [16]. May not scale well without Extreme Manufacturing principles

Revenue Models

1. Apartment complex economics. $700/mo. One year at $8.4k. Works with free land and utilities using Radical Waste Treatment.