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Housing innovations: the past is the future

The home building industry may not have recovered in the US, but apartment construction is making a comeback. Within a few short years of the foreclosure crisis, everyone from architects to developers to planners have begun turning back the clock to a time when renting apartments and living in rooming houses were affordable, socially acceptable alternatives to homeownership.

Recently, journalist Neal Peirce advocated the return of rooming houses to address the need for smaller, more affordable units for young people, who have been adversely affected by the US recession (“Bring back the rooming house?” citiwire.net, November 12, 2011). Like other notable writers (Edward Glaeser, Richard Florida, Mark Hinshaw, Joanna Pachner), Peirce argues that it’s time to turn a new page on the postwar suburban single-family home:

“Unquestionably, tens of millions of oncoming youth will disconnect from the American vision of home as a “homestead”–the self-contained units of our American forbears, translated since World War II by a suburban home occupying its own lot.”  Neal Peirce, Washington Post Writers Group (citiwire.net)

Among the reasons young people will need new, affordable housing options: lower salaries, lower employment rates, delayed marriage resulting in more single-person households, a desire to live in mixed-use neighbourhoods near transit, and lower car ownership (does this sound familiar?) In Canada, the rising demographics (youth and young adults, immigrants, single-person and single-parent households, seniors) would probably jump at the chance to live in rooming houses, worker housing or affordable rental units, considering housing prices across the country. For example, where do you live if you’re an immigrant in Canada on a temporary worker permit? Your only real choice is renting a market-rate apartment, likely sharing with people you scarcely know. Downsizing senior? Good luck finding a condo that costs less than your house once maintenance fees are added in. Young adult working in your first job? You’ll be forking over about one-third of your salary to rent, even if you live in a mid-sized city.

Hinshaw, a Seattle-based architect and planner, argues that the recession has forced cities to think about Smart Growth rather than rushing forward into new development faster than public investments can be made (“Recession is producing a needed reset on land use”, www.crosscut.com, September 30, 2011). Now, cities and counties have the time to decide how and where to move forward. Some areas where local governments have made progress, according to Hinshaw: economic development through the construction of shared public spaces, redesigning streets to encourage different travel modes, and the development of rental housing.

“For far too long, elected officials and citizen groups have treated apartment developments like a pariah, relegating them to noisy arterial streets or slamming them behind strip malls. It’s as if only decent folk are those who own single family homes. If we learned anything from the past five years it is that the American ideal of home ownership has been cruelly oversold.”  Mark Hinshaw, www.crosscut.com

Changing development conditions (stricter lending standards, foreclosures, and a rapidly growing rental market) have made investing in multi-family rental housing a safe move for developers who, just a couple of years ago, would have built high-rise condos. Increased demand for rental units has resulted in rent increases in many cities that can provide developers a reasonable return on their investments (“Demand for Denver apartments exceeds supply”, November 29, 2011, NPR). NPR reports that this could be a lasting trend; one that harkens back to an era of when renting was more common than owning in many countries. In Canada, for example, pressing postwar housing needs were met through a boom in apartment construction during the 1950s.

If only Canadian provincial and federal governments would enable developers to build rental housing, rooming houses, granny flats and other housing types that would provide alternatives for various demographic and income groups. We’d have to turn back the clock to the 1970s, when experiments like co-operative housing became popular in Canada as foreclosures and interest rates rose. It seems that during economic crises, homeownership loses its rosy glow. Renting, co-housing, co-operatives, rooming houses, and rent subsidies make more sense to policy makers, developers, and planners during economic downturns, when few can afford to buy and governments are too poor to subsidize ownership. And yet, as all the authors cited in this article point out, North Americans still display a slavish dedication to the “dream of homeownership”; most have long forgotten that the “dream” was enabled by dirt-cheap postwar mortgages, artificially-low interest rates and government incentives for first-time homebuyers. If the current rental housing trend persists for more than five years in the US, and Canada finally passes its national affordable housing strategy, we might see the beginnings of a paradigm shift to rival the one that gave us single-family suburban homeownership in the first place.


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