Is There a Housing Crisis
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Data
- 1000 sf size is acceptable [1]
- Cheapest new house is $94/sf at $200k - [2]
- Median house cost - $128k Mayville mo. [3].
- South midwest and south east, at $250k around for median price. [4]
- Detroit is like 1/3 the average housing cost! [5]
- Cost of low rent afforded by the poorest people makes apartment operating cost unsustainable? [6]
- Tax credits apply to those whose income is 60% of median [7]
- Extremely low income means 30% of median (AMI) [8]
- Current standard for affordability: no more than 30% of gross income [9]
- 60% of median rent in Denver is $900/mo. [10]
- Favela property values are on the rise and speculation + forced removals are in. [11]
- It costs $10M on average to build a 50 unit apartment. [12]
- 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. [13]
- Management expenses for apartments are 3-7% [14]. Ex. $25k for a complex that makes $500k/year. Also, cap rate is ratio of return after operating expenses to what you paid.
- Kanye West got into homeless housing, but no substance is apparent online -[15]
- Zero-down loans do exist - for rural homes, and veterans, and native Americans [16]
- Brookings Institution suggestions - good ones. One is a call for transparency of build (open source). [17]
- It costs $100-200/sf to build a house. [18]
- Habitat for Humanity is both a builder and a mortgage company - [19]
Issues
- KC situation. Affordable is rent only of $700. [20]. If SEH costs $100k, can we do rehnt at $700/month? Link to a guy building affordable homes, 5 per year.
- Inclusionary (affordable) zoning - actually increases housing costs? [21]
- Essential conflict of interest between big builder profits and affordability? [22]
Solutions
- Habitat does CEO Builds - [23]. May not scale well without Extreme Manufacturing principles
Revenue Models
- Apartment complex economics. $700/mo. One year at $8.4k. Works with free land and utilities using Radical Waste Treatment.