Episode 1494
How do we fix our affordable housing problem?
How do we fix afforable housing in the United States? With homeless being a problem in major metropolitcan areas... is this a housing problem or is it mostly a drug addiction and mental illness issue before its a housing one? Lets dive into this controversial subject in this weeks mid-week special.
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Mentioned in this episode:
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Baldwin Hardware
Transcript
[00:00:32] Eric Goranson: Happy midweek special. Wanted to talk today a little bit about some of our housing issues that we have and, uh, of course homelessness and the cost of housing these days. And I think we're looking at this thing completely wrong in most places across the us and if we're looking at it completely wrong, we're not gonna fix it.
[:[00:01:17] Eric Goranson: That keeps 'em out of shelters. If you're gonna walk around in our city here, for instance, and this is very common on the west coast, you can see this in almost every major west coast city. They are letting people camp outside, camping in streets, camp in people's yards. It is kind of an anarchy free for all as far as how that goes, and it can take sometimes six months to a year to get people at your city government to get them to move even when they're on your own property, which is crazy to me.
[:[00:02:18] Eric Goranson: Program that gives them the help they need. Because after all, our goal at the end is to make these people get back to being, you know, contributing members of society and not ruining the environment like we see out there now. I mean, that is ironically the biggest thing that we see in our cities on the West coast, for instance, is the environmental damage that is done to parks, nature areas.
[:[00:03:05] Eric Goranson: But really what we need to start doing is look at how our cities are creating affordable housing. First off, like I said, we need to deal with the homeless and mental illness and drug addiction, and I think those are three different things. There's a percentage of people out there that just need a place to stay and are looking for a place to stay.
[:[00:03:46] Eric Goranson: But because the city is involved, it costs three, maybe four times as much as if you had the private sector Do. And that's where the problem rises because you've got all the bureaucracy of having a city [00:04:00] government be a building company. You're never gonna get that one having that done because you could literally build three or four times houses.
[:[00:04:39] Eric Goranson: If I'm gonna go tear that down and put a house or two on it, my city development fees could be 60 or $80,000. That's the fee that I have to pay to the city to get the building permit and get that done. Now, there's also fees to hook up the, the power and water and sewer, and I get [00:05:00] that some of that stuff.
[:[00:05:25] Eric Goranson: Now, another thing that we need to work out, Is what we call our urban growth boundaries in many areas, and that is an area where they have tried to keep urban sprawl from happening where there is an designated area that you can build homes, and there's an area outside of that that they're trying to keep as forest nature, farmland, whatever that is outside of your urban area.
[:[00:06:19] Eric Goranson: And thus making it more expensive. It's the whole supply and demand thing with that. So it's great for you and I or anybody else as a homeowner that our property values keep going up, but it's really hard for the people that are trying to get into housing or get into their first house. So I think we're gonna have to find some ways to work around.
[:[00:07:12] Eric Goranson: I know here in my state, for instance, and I, I can only talk about what's in my area. I know your area out there has other issues as well that you're seeing on your local news, but I'm well versed in what's going on. If I was going to get my mom into Oregon's senior housing and she doesn't live in Oregon, so that's not the case.
[:[00:07:53] Eric Goranson: It could be longer now, but there's, the problem is that we just don't have enough [00:08:00] resources for that, and I think it's one of those things where we've gotta really reevaluate and almost start over. With how we're doing this stuff to be able to fix it. Because right now there's no place in the United States that I'm seeing that's really fixing this outside of some places in the south or desert Southwest, where they are coming up with, with better solutions.
[:[00:08:45] Eric Goranson: How is a brand new family gonna afford That takes a lot to do that. Now, as a homeowner, I've kind of enjoyed the 30% increase in home prices between, you know, the last couple years. And now here's [00:09:00] the problem that we see though. Is that that combined with the double digit inflation that we see across everything else, it's made it very hard for somebody to be able to buy a house these days.
[:[00:09:41] Eric Goranson: And then, you know, if you look at other rules that you see out there, they say that you should aim to spend less than 28% of your pre-tax monthly income on a mortgage outta those general historical guidelines. I'll tell you what. That is almost impossible when you gotta look at what a $600,000 [00:10:00] house is.
[:[00:10:31] Eric Goranson: And, you know, building materials have gone up, of course, because we have taken a lot of the trades out of our schools. The great news for people in the trades is you can make six figures to be a plumber or an electrician or somebody else in the trades out there if you're working hard. The problem is, is now that labor price has gone into the price of a.
[:[00:11:17] Eric Goranson: I mean, it is a huge problem that we're gonna have to figure out. and how to deal with that there. Now if you get rid of all those first time home buyer credits and all that other stuff, and you're just going to buy a regular house, maybe it's your third or fourth house or whatever, if you're gonna buy that $600,000 house and you put 20% down, let's say that's, you know, 125 grand, your loan amount, 475,000 bucks, basically, and let's say it's down at a really cool 5% interest rate, you still have to make $115,000.
[:[00:12:17] Eric Goranson: Conversation because with inflation going the wrong way, more and more people struggling to stay afloat. The other hard part we're dealing with is rental rates have been going up as well. You know, when you see a eight or 10% rise, In apartment rates out there for rentals, that sure doesn't help people get into housing as well.
[:[00:13:01] Eric Goranson: This was not meant to be any kind of a rant, but I'm just trying to spur some conversation with the people of how do we fix this to get this back under and, you know, under control really so people can get into housing. And I'm not saying that the government needs to build a bunch of affordable housing, it seems that that has been going sideways and is costing more than it should to do that.
[:[00:13:43] Eric Goranson: Well, that didn't do anything for adding affordable housing to it, but then that dollar figure raises those unit prices up cuz they have to pay a millions and millions of dollar fine. , then that money goes into the city coffers, and then the city spends way too much [00:14:00] on affordable housing and we're not fixing the problem.
[:[00:14:28] Eric Goranson: And I think through, we need to be looking at that model versus relying on our elected officials to fix the problem for us, because I think there's just too, Too many hands in the pot trying to do this. All right guys, well that's enough about this today. Just something to think about. If you want to sense com some comments on this head over to around the house online.com, I'd love to continue the conversation there Over on social media or even on around the House Nation, this is designed to be not a political conversation today.
[:[00:15:20] Eric Goranson: He's a big social media influencer, plumber. He is also in the mechanical world, so he's H V A C as well. We'll be talking with him and then I'm gonna be tackling some home security stuff as well. As some other projects around your house on Saturday that you don't wanna miss all coming up this weekend on around the house.
[:[00:15:57] Eric Goranson: Change those batteries. Make sure they're tested, make sure they're working. [00:16:00] And if not, call your local firefighter. I betcha that they will be happy to come out and help you. Check. To make sure yours are working correctly. All right, have a great rest of the week everybody. Thanks again for listening to Around the House
