Quote from: K-Dog on Apr 24, 2024, 12:14 AMIf tax abatements are needed to make a project viable, it takes no genius to know that every trick to increase profit will be used.
They aren't needed to make them viable, it's to make the profit margin higher.
If you have a parcel of land to build on, if you build luxury housing you can get a big margin between the cost of the materials and what rich people will pay. Big profits.
If you put up affordable housing, the difference between the material cost and what people can afford to pay is much smaller. It's still profitable, just not AS profitable. So without any legal obligation to build affordable housing, developers ALWAYS choose to build luxury housing. Thus you have too many McMansions priced at $500K, and too few 3 bedroom townhomes priced at $200K.
The tax credits shrink the difference in the profit margin, but they don't obligate the management company to keep the maintenance up to snuff, at least until it's so bad you have to call in the health dept. So this problem needs to be addressed in the affordable housing laws.
Also quite obviously in every city (and country) now, it's a systemic problem that because luxury housing is more profitable, that's what gets built even if what the neighborhood needs is more affordable housing. This could easily be resolved with zoning laws that required a sufficient acreage be dedicated to affordable housing, the problem being of course NIMBY; luxury home owners don't want affordable housing in their neighborhood because it will lower their property values. You can't put it in poor neighborhoods, because the density there is already at or past the maximum for affordable housing.
Housing definitely needs to be planned and built on a socialist model, not as for-profit private property. It would be a very EZ AI application to figure out how many of each type of housing a given community needs based on the population demographics, average incomes and family sizes. It could then map it out based on the age of the current dwellings and average property sizes and begin to raze older homes on large properties and replace them with affordable housing at greater density. Homeowners would be compensated through eminent domain laws and offered one of the new units in addition to financial compensation. Of course, all the Boomers in big McMansions on 2 acres and the RE salesmen and developers would stand in front of their McMansions with AK-47s and signs saying "You'll have to pry my McMansion from under my cold dead toes" when the bulldozers showed up, but you can't makean omelet without breaking a few eggs. :)
RE