to: Roger L. Stancil, Town Manager
from: J.B.
Culpepper, Planning Director
Rae Buckley, Housing and Neighborhood Services Senior
Planner
subject: Response to Petition from Orange Community Housing and Land Trust Board of Directors to Commission an Affordable Housing Market Study
date: September 22, 2008
The purpose of this report is to respond to a petition from the Orange Community Housing and Land Trust Board of Directors requesting that an affordable housing market study be commissioned. Included in this report are two options for pursuing the development of an affordable housing market study.
We recommend that the Council adopt the attached resolution to authorize the staff to develop and release a Request for Proposals for a study of the affordability and demand for condominium units that would analyze both the common expense assessments for condominium units as well as the demand for affordable 1- and 2 bedroom condominium units over the next ten years.
On April 21, 2008, the Treasurer of the Orange Community Housing and Land Trust (Land Trust) Board of Directors petitioned that a market study be commissioned to determine the Town’s affordable housing needs over the next ten years. Specifically, the Land Trust expressed concerns to the Council regarding the large number of one- and two-bedrooms condominiums that will be built over the next several years as a result of the Council’s affordable housing policies. The Land Trust is unsure of the marketability of the units, and whether households that might be interested would financially qualify for the units.
On June 9, 2008, we provided a response to the Council that proposed the preparation of a follow-up report regarding the options and costs associated with the development of an affordable housing market study for the community over the next ten years.
In Attachment 1, we present sample information about affordable housing market studies in and outside of our region including cost and scope of information. We note that the majority of the affordable housing market studies we have found were developed in conjunction with, or as a part of the U.S. Department of Housing and Urban Development (HUD) consolidated plan process.
A consolidated plan is the first step in applying for and receiving federal money for housing and community development programs. The Town of Chapel Hill is a member of the Orange County Consortium along with Orange County and the Towns of Hillsborough and Carrboro. The Orange County Consortium must submit a consolidated plan every five years to illustrate to HUD not only the housing and community development needs in Orange County, but also a coordinated plan to meet those needs. A “Housing Market Analysis” is one of the required elements of the consolidated plan.
The Orange County Consortium submitted a 2005-2010 Housing and Community Development Consolidated Plan to HUD on January 11, 2006. The 2010-2015 Consolidated Plan will be due to HUD in January of 2011.
We have not found information about affordable housing market studies that either analyze or focus exclusively on the production and demand for 1- and 2-bedroom affordable condominium units.
We have identified two options for pursuing the development of an affordable housing market study. The first option focuses on the demand for affordable 1- and 2-bedroom condominiums and relates to funds that are available through the General Development Agreement between the Town of Chapel Hill and the Ram Development Company. The second option would defer the development of an affordable housing market study until Orange County develops its 2010-2015 Consolidated Plan.
We believe that the funds referred to in Article VIII could be used to commission a study about the affordability and demand for condominium units that would analyze both the common expense assessments for condominium units as well as the demand for affordable 1- and 2 bedroom condominium units over the next ten years.
We believe that we could ask the Orange County Consortium to include an analysis of demand for affordable 1- and 2 bedroom condominium units in the development of its 2010-2015 Consolidated Plan. The plan is due to HUD in January of 2011. We estimate that the development of the 2010-2015 plan would begin in early 2010.
We would recommend this option if the Council is interested in a full market study that would examine the affordable housing market beyond the demand for affordable 1- and 2-bedroom condominium units.
We believe that the Land Trust petition was primarily concerned with the demand for affordable 1- and 2-bedroom condominium units that are currently approved to come into the Land Trust in the next few years. Because of this, we recommend that the Council consider the use of funds dedicated in the General Development Agreement between the Town of Chapel Hill and the Ram Development Company for the purpose of commissioning a study about the affordability and demand for condominium units that would analyze both the common expense assessments for condominium units as well as the demand for affordable 1- and 2 bedroom condominium units over the next ten years.
If the Council is in favor of commissioning a study about the affordability and demand for condominium units, we would develop and release a Request for Proposals.
We recommend that the Council adopt the attached resolution to authorize the staff to develop and release a Request for Proposals for a study of the affordability and demand for condominium units that would analyze both the common expense assessments for condominium units as well as the demand for affordable 1- and 2 bedroom condominium units over the next ten years.