SROs are BACK!

Back in the 1970s in NYC, Single Room Occupancy apartments were the definition of Urban Blight, and they were basically all gotten rid of due to endless health code violations, insect and rodent infestation, needles in the hallways, and of course as hubs for prostitutes.  Basically, an entrepreneurial Pimp rents an apartment and has a half a dozen flat backers working for him, clocking in a few times a day for a 1 hour slam-bam-thank you m'am liason.  In the 70s, a streetwalker whore cost $20/ fuck, you could get a blow job for $10.  Depending how generous the Pimp was, he would take somewhere between 10-90% of the retail price and pay the rent and have 1 of the girls bring the sheets to the laundry once a month, if they needed it.  lol.  So average $5/hour used 10 hours a day, the room brought in around $1500/month.  In those days, you could rent such a place for $100/mo or even less.  This was of course entry-level pimping and whoring, these were not the guys driving Lincolns and Cadillacs and the hos didn't look like Julia Roberts.

Fast forward to 2024, and it should be no surprise that bringing back these hell holes and re-branding them as "Micro-apartments" is being touted as the "market solution" to the affordable housing problem.  It's really the same concept as the Tiny Home, just putting 100s of them into 1 by providing the absolute minimum amount of space necessary to fit a bed and a toilet/sink to wash up and excrete.

Now, what exactly is the minimum space necessary?  Well, the WHO  has guidelines on this stuff which is supposed to be followed with Prisons, and it's generally considered to be 18 meters², or around 250 sq ft.  This takes into account respiratory issues, sanitation, psychological factors, etc.  Do prisons adhere to this standard?  With the exception of Federal Penitentiary Country Club prisons for white collar criminals in the FSoA, I doubt any country follows these guidelines for prisons.  Any cell that big is going to be shared by 2 people.

So, essentially what we are saying to people is hey, if you get a job and obey all the laws and pay your taxes, you can pay for your own Prison Cell to live in!  Which if it was in a nice, safe, well-kept building might be better than prison, but the slumlords who own and rent such places out aren't known for making sure the elevator works, the building access door lock works, all the hall lights work, etc.  As you might expect, besides the prostitutes, even you regular renters have a rapid turnover rate, they're in town for a seasonal job or just moved from another state to start a new career or of course, just got let out of prison.  Or for old folks and cripples like me, been informed by Medicare after 100 days in a SNIF to recover from some illness or operation they won't pay anymore and you gotta leave IMMEDIATELY.  Fortunately for me, I have so far been deemed sufficiently crippled by Medicare to warrant approval for Long Term Care and not told to GET OUT YESTERDAY yet, which has happened to me on 2 prior occassions, neither of which worked out too well.  In one case I was sent back home to the apt I had continued paying rent on, but without sufficient home health care assistance to take care of myself yet, Ii got worse againg quickly and then lost my leg.  The 2nd time, I gave up the apt because I was hospitalized too long, and they pitched me into an Assisted Care Home which as long time readers know was Dante's 7th Circle of Hell.

In my current SNIF, my room size just about makes the WHO guidelines, but in this type of facility besides your own room, there are 1000s of sq ft of common areas to roll around, and outside garden areas in front and back to sit outside in the good weather.  In most SROs, there are no common areas, just a long narrow hallway with doors to each cell on either side, and a stairwell at both ends and elevator in the middle.  The apartments usually do not have a porch or patio to sit outside and relieve the claustrophobia, and due to fire laws if you have one you're not allowed to smoke or BBQ on them.  There's no relief from the constant state of claustrophobic, and they are too small to have friends over, except perhaps 1 friend to have sex with on your twin bed mattress.  Actually sleeping together ends with one of you on the floor sometime during the night.

If you do have 200 sq ft and it's got windows and you set it up right  with a murphy bed or loft bed with a desk under it, you can make such a place somewhat liveable, but if this is what you are gonna be stuck with living for the rest of your life, it can become pretty depressing even so.  A modern society that can't at least provide a 500 sq ft 1 bedroom apartment for young single workers and old retired ones is not living up to the myth that living in a 1st world industrialized nation is a better life than rural poverty.  Shacks in the Favelas in Rio are bigger than 250 sq feet.

For the recent migrants however who currently are either out on the street, on church floors or in army tents or warehouses with 200 beds laid out on a 10'x10' grid, getting your own SRO with heat and running water is of course a big improvement as a temporary living arragent for a few months-year while you find a job and become assimilated into the rat race.  The thing is, these places aren't going to be temporary for many, they'll be there for years.  In a couple of years they'll be drinking heavily and using drugs.  The lights in the hallways won't be replaced and the eevator won't work half the time.  Same as it was in the 1970s.

https://www.goskagit.com/news/nation/homelessness-affordable-housing-shortage-spark-resurgence-of-single-room-micro-apartments/article_d7124a2c-99ad-58f1-b803-621280ffc64b.html

Micro-apartments are back after nearly a century, as need for affordable housing soars

RE

As usual, a combination of Goobermint zoning laws and the desire of RE developers toprop up the cost of housing is the major stumbling block in converting unoccupied commercial buildings into affordable housing.  Much more than office buildings which don't have plumbing to support separate bathrooms for all the office spaces converted to apartments, strip malls have plumbing that puts bathrooms in each storefront that could be adapted to make residential bathrooms and kitchens.  There are 1000s of square feet of empty mall space in just about every city inn the FSoA with the transition to online shopping.

This would also put housing for workers in commercial districts, making fr shorter commutes and more "walkable neighborhoods.  Will such conversions start to happen?  Not if captalists and hedge funds with a large portfolio of residential housing have anything to say about it, and they do.

https://www.vox.com/the-highlight/24075581/housing-conversions-stripmalls-affordable-supply

America is full of abandoned malls. What if we turned them into housing?

RE

Which strip malls where?  Seattle and areas nearby areas actively convert old strip malls into housing.  Malls are ripped down and high end apartments go up where they were.  Strip malls may not have been built on the best land, but they all are connected to infrastructure and flipping them into apartments is very profitable.

Then end result is more crowding and the malls had been originally placed where they were for a reason.  Now you have neighborhoods miles away from grocery stores  with apartments built where the neighborhood used to buy groceries.

I haven't been down in the  lower 48 in quite a while, but last time I was in Springfield there were several abandoned strip malls around town.  Right near where my mom lived there was an abandoned food superstore that could have easily been converted to a dozen or more apartments of 1 or 2 bedrooms.  It was right across the street from another food superstore, which was why it went out of biz.  Kroger vs Safeway, and Kroger won.

Here in Anchorage we have the Northfield Mall which has been abandoned for a decade, while at the same time every year the city struggles to find shelters for the homeless.  The rental market is so tight I have been on 2 waiting lists for affordable housing for over a year.

I don't know what the reason is the Seattle market is different, perhaps there it's because they are able to completely raze the mall and put up profitable market rate housing instead of affordable housing units.  There's enough rich people around  they're not only short of affordable housing, they're short of land to build more new Condos for the young IT programmers or boomers selling their McMansions to the Chinese to downsize as they retire.

RE

More grist for the mill about turning strip malls into housing.

Even though it's getting a decent amount of press coverage, I don't expect to see this move along very quickly or get much more than a smattering of conversions done.  This only partially due to the zoning regulation problems.

The thing about strip malls is they take a different type of Real Estate developer than the ones who do residential construction, and have a different type of RE management.  They are usually owned by small, local capitalists who acquire a piece of land zoned commercial, but too small to be built on by a big corporation that puts up the large malls with Anchor stores, big box places like Best But or Target, etc.

These smaller owners aren't experienced with or don't want the headaches involved with low income housing rental, and all the attending Goobermint regulation involved around finding qualified renters and meeting guidelines.  So they would have to find a buyer for those properties who did want to take on such a burden,for what is likely a very low profit but fairly capital intensive business for a small time capitalist.

The only way it might work is if Da Goobermint took over the properties directly and managed it with some kind of public housing agency, but except for really big cities like NYC, most municipalities with these kind of strip malls empty and available don't have such an agency.  Nor given the fact most such small munis are strapped for cash and personnel these days is it likely they will be voted into existence any time soon.

So in the meantime, these places will stay mostly vacant and will just rot, while homeless people set up tents in their overgrown parking lots that haven't been repaved in a decade.   Gotta love Capitalism.  Small or big, it always manages to not solve any problems that really need solutions.

https://fortune.com/2024/04/13/office-conversions-retail-residential-dead-malls-housing/

Tired: Office conversions to residential. Wired: Turning dead malls and suburban shopping strips into apartments

RE

I've mentioned before that the problem with Affordable Housing isn't strictly an Amerikan one, similar situations exist in the UK, Oz and Canada as well, all the former Brit colonies.  It shouldn't be too surprising to hear that Germany also has the problem, despite theoretically being more "socialist" in Europe.  In fact, the same banking system is used everywhere, and there is not that much difference in how developers are financed and home buyers get mortgages.  It's all the "Persoonal Property" model throughout Western Europe.

I suspect the housing situation is not that much better in Eastern Europe in the countries that were part of the old Soviet Union, but for different reasons.  In Moscow for instance, the population has been undergoing die off since the fall of the Soviet Union, which should leave apartments emptied by dead people.  However, I also doubt much new construction has taken place over the last 40 years either, as the State used to build housing and issue it out, but I doubt they do it that way now.  Nor do I think there are many private contractors. So they probably are living in buildings dating back to WWII and earlier.

https://www.dw.com/en/german-housing-crisis-finding-a-home-like-winning-the-lottery/a-68840785

German housing crisis: 'Like winning the lottery!'

RE

This article demonstrates the numero uno problem with so-called "affordable housing" complexes that are managed by private RE development companies.

They might put up a building using similar architectural plans to one being rented out at market rates, but they don't provide the same level of maintenance and upkeep on the property, and they skimp on or close off entirely common areas in such buildings that make living in a relatively small and cramped unit more bearable.

Although not exactly the same thing, my current living situation which has me in about a 200 sq ft room would be incredibly claustrophobic if that was where I had to spend the whole day, but right outside the door is a common area I share with 16 other gomers & cripples that is about 1000 sq ft.  Out past that is an even bigger commons for all 6 of the 17 room wards, then upstairs is a dining room probably 3000 sq ft.  Then outside we have a garden and smoking area as well.  So even in winter I can leave my room and roll around the building.

I have applied for 3 affordable housing agencies, Alaska Housing run by the state, Cook Inlet Housing run by a Native non-profit corp, and Neighbor Works, a private RE developer and mgmt company which has about a dozen properties.  In order to qualify for the tax credits, all the buildings are supposed to have some units reserved for low income.  In practice, the company only offers one building, a renovated SRO Hotel in downtown Anchorage with studios the size of my room here in the Gulag.  There are no common areas, all the rooms are off a long narrow hallway with emergency stairwells at either end and an elevator in the middle.  It's the only building I have been offered an apartment in after more than a year on the waiting lists.  Obviously, I turned it down.

By contrast, the units offered by both Alaska Housing and Cook Inlet have extensive common areas and the 1 bedroom units around 550-650 sq ft in size with a full kitchen, not kitchenette.  The one across the street has a pool table, a full library room with computers, an exercise room and a communal kitchen and party room if you have a big gathering.

Private for profit capitalists will always skimp out on anything not legally required to get their tax abatement, and they always have less scheduled maintenance with cheaper contractors.  Even if the building looked nice when they cut the ribbon, in 2-3 years it's a mess.

Tax abatements to cut the building costs and pad the profits on affordable housing are not enough to insure that for-profit RE mgmt companies provide reasonable and well maintained common areas for low income residents.  Just as there need to be minimum size standards for each unit, there needs to be a minimum size for common areas depending on how many units and residents the building is designed for.  Maintenance contracts need to be reviewed and approved each year before the company receives its tax credits.  Contractors need to keep logs of their work and hours on site, also reviewed by the housing authority, not the mgmt company alone.  Contractors who regularly fail to maintain  thr properties in good condition need to be decertified and fined.

Low income affordable housing doesn't need to be palatial with huge panoramic views and doormen, but it should be clean and comfortable to live in and not claustrophobic.  Closet size units with no more living space than a prison cell is not a viable solution to the housing crisis.

https://greenpointers.com/2024/04/23/affordable-housing-tenants-in-greenpoint-describe-squalid-conditions-in-luxury-building-complex/

Affordable Housing Tenants in Greenpoint Describe Squalid Conditions in Luxury Building Complex

RE

QuoteTax abatements to cut the building costs and pad the profits on affordable housing are not enough to insure that for-profit RE mgmt companies provide reasonable and well maintained common areas for low income residents.

If tax abatements are needed to make a project viable, it takes no genius to know that every trick to increase profit will be used.

But if you think the most holy and sanctified 'market; is the medium which people are pre-ordained to interact with the universe.  Then I suppose tax abatements are all you can come up with.


All you can do is sing a happy song and remember dreams are free.  But rent most people will pay until the day they die.  Average rent for a two-bedroom apartment in New York City was around $3,000 to $5,000 per month recently.

NYC rentier pets cost a lot to maintain.  Or I am wrong, and the 2008 bail out packages have finally lowered the value of the dollar  It was bound to happen.  Subsidizing the rich will do that.

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

You can file this under "Misery Loves Company" or, "No matter how bad things are where you live, they're worse somewhere else."

I am a little surprised that the affordable housing problem which basically stems from capitalism run amok in the RE market appear to actually be WORSE in European countries than in the FSoA.  Traditionally, European countries ran a more socialist system than the FSoA, but at least in the Netherlands the right wing has been in control for the last 20 years and thoroughly made a mess of the housing market.

Of all the problems faced by our society, this one to me seems so straightforward and requires no new technology to fix.  All it requires is planning and financing and creating a WPA style building agency to put up the buildings.  Unfortunately of course the whole banking system is so vested in the property market as a source of assets and loans any change which would make housing cheaper and more easily available is resisted by everyone involved in the business, from the builders and developers to the bankers issuing the mortgages.

Each year it gets worse, and each year people complain and nothing changes.  It's amazing stupidity.

https://www.theguardian.com/news/article/2024/may/06/netherlands-amsterdam-next-level-housing-crisis

'Everything's just ... on hold': the Netherlands' next-level housing crisis

RE

One of the few articles that really addresses the real underlying nature of the affordable housing problem, beyond the fact it's not as profitable to build housing for poor people as it is for rich people.  It's the nature of the financial model which was put into place after WWII and made housing a financial asset which could be financed by making large debt financing purchases possible for J6P.

Where he goes wrong is after identifying the actual problems, he says this system is immutable, basically handed down by God and can't be changed.

"The term "housing trap" is a way to explain the financialized craziness that makes housing prices more responsive to macroeconomic capital flows than local supply and demand dynamics. The reason housing prices are crazy everywhere at the same time isn't because every local market has the same supply constraints. Supply constraints exist in many markets, sure, but the story of housing affordability is primarily a financial one.

We financialized the housing market for expedient, even righteous, reasons. The consequence of this approach is that today's housing acts more like a financial product than a shelter for a family.

Local governments won't change our country's macroeconomic environment. No city can decouple bank reserves from mortgage-backed securities. No mayor will outlaw the thirty-year mortgage. There won't be a protest movement forcing public employee pension funds to divest from the housing market. For most housing products purchased by most people, we have to deal with the system we've been given.

WHY do we HAVE to accept this stupidity?  All that has to be done is give the HUD the authority to open competitive bidding to contractors for the price target housing you want in a neighborhood.  Da Goobermint can get all the materials for building the units cheaper than individual contractors can because they can contract directly with the large corporations like Weyerhauser or Dupont that produce the materials and cut out the middlemen.  Then, instead of selling the units at whatever the market will bear, make the price 33% of the average monthly income for a min wage worker in that neighborhood.  Maintain Price Controls on buying and selling units, and require the owner to live in the unit, not use it as a rental property.  Poof, problem solved.

The solutions he suggests like turning rooms in your McMansion into rental apartments andd building Tiny Homes in the backyard will do almost nothing, despite what afficionados like to say, most people don't want to line in a shipping container, and you can't cut up the inside of the typical McMansion and maintain the kind of privacy people buy those things for to begin with.

Housing can't be both a financial product to be securitized and traded and also a place J6P can afford to live.  Why won't it happen?  Because Baby Boomers who own paid off McMansions would see the value of the property drop like a stone, and people who have a mortgage would go so far underwater they would drown.  TBTF Banks holding 30 year mmortgages would all go belly up as the securities that form their Tier 1 Capital structure dropped to 20 cents on the dollar.  It won't happen because all the people who have benefited from this system would lose most of their wealth an because our financial system is built on it.  It will take a full on crash of the RE market for it to change.  Keep your fingers crossed.

https://www.strongtowns.org/journal/2024/5/28/how-affordable-housing-distracts-people-from-housing-affordability

How Affordable Housing Distracts People From Housing Affordability

RE

I have never cared about how much the house is worth.  To me it was always about paying it off and having no rent.  Sell it for a fortune?  So what, a new place costs a fortune and you have to live somewhere.  And now houses are worth so much property tax is like new rent.

A system that reduced housing values should have a way for people to refinance homes as they lose value for those who have an underwater mortgage.  Construction of the system should however not reward those who must refinance to a lower value.  Only ease the pain of the stupid who bought air. Socialize their loss somewhat.

But this is random speculation.  We live in America.  Easing of pain is not what we do.

Quote from: K-Dog on May 28, 2024, 07:56 PMI have never cared about how much the house is worth.  To me it was always about paying it off and having no rent.  Sell it for a fortune?  So what, a new place costs a fortune and you have to live somewhere.  And now houses are worth so much property tax is like new rent.

A system that reduced housing values should have a way for people to refinance homes as they lose value for those who have an underwater mortgage.  Construction of the system should however not reward those who must refinance to a lower value.  Only ease the pain of the stupid who bought air. Socialize their loss somewhat.

But this is random speculation.  We live in America.  Easing of pain is not what we do.

"Legacy" properties like yours pose another problem, because they are out of the system once the mortgage is paid off.  There no longer is a bank whose Tier 1 capital structure is affected, no pension fund holds securities of which it is a part.  The only effects are on the price it could be sold at if it were to be sold in the new controlled market and how it would be assessed for taxation purposes.  You also do not have a home equity line of credit attached and aren't using it as collateral upon which to leverage other loans or purchases.

The problem is here that it's uncertain who would buy this type of house with many bedrooms and large square footage and property if there are available homes that are much cheaper and more energy efficient that better fill the needs of the new population of DINKs (double income no kids).  I suspect the number of people who would buy such homes is quite small now, so they would either need to be razed or cut up into multifamily dwellings if the architecture is suitable for that.  That's what they did in old cities like St. Louis and Detroit to the Mansions built in the late 1800s when these cities were booming in the years after WWII.  I had a friend who lived in one.  The 1st floor was cut up into 3 apartments, 2nd floor 2 and the basement and attic each had 1.  They were all 1 or 2 bedroom apts. Floor plan was crazy nuts. This was the only way the people who owned these places could afford the taxes assessed on them as the cities lost their populations of wealthy people that could afford big homes.

As long as you could afford the new tax assessment under the new property financing structure, you wouldn't need to make any changes and any financial loss is just on paper, it's not realized until you sell the property or die.  If the new taxation is too high, you would either have to divide up the place to rent some units or sell it to Da Goobermint at a fixed rate to be replaced by housing under the new code in terms of square footage and energy efficiency.

I wouldn't worry about it because it's not gonna happen.  Your situation is not uncommon amongst old Boomers, but it takes a back seat to the much larger problem of all the homes owned by GenX and later that also often have 2nd & 3rd mortgages and consolidation loans that reduced their credit card debt & auto or student loan debt.  That's where resolving the financial mess would be a real nightmare. Jamie Dimon and the rest of the Masters of the Universe will never let this happen.

RE

QuoteThe problem is here that it's uncertain who would buy this type of house with many bedrooms

Four bedrooms and 2700 square feet is not a palace.  Plenty of people would want this house.  It is nice but a lot of people would not think it is 'too much'.  Homes in Seattle are being built three stories high and five feet from the property line on all sides.  I see big and ugly everywhere.  What we have is nice.

Right now if the house was on the market it could sell in a day.  I picked the location to be close to Seattle and the I-90 I-405 freeway interchange.  I did that on purpose and looked at homes in the area so I could take any job south to Tacoma and north to Everett.  Commutes are not as easy as they used to be, so that area is now reduced, but the location remains good.

Better insulation in the attic would be good.  The new heat pump is working great.  I think the furnace only burned for two days this winter.

One of those bedrooms is the headquarters of the Doomstead Diner.  Four bedrooms is not too many.

It all depends on the taxation structure and the price of new housing that substitutes for it.  It's not going to happen so don't worry about it.

RE