1 David Yakobson
From: Peter Borresen
Sent: Tuesday, October 8, 2024 9:23 AM
To: councilmtgitems
Subject: Public comment. City Council mtg. Oct 8th. Item 5C Public comment. City Council mtg. Oct 8th. Item 5C
Dear Santa Monica City Council,
The Santa Monica Housing Commission previously presented a report on advancing affordable homeownership to the council.
Here is a link to the report:
https://www.santamonica.gov/media/HED/Housing/Housing%20Agenda%20Attachments/Santa%20Mo nica%20Housing%20Commission%20Affordable%20Homeownership%20Report%207%20May%20202
3.pdf
The report recommends that the city: “Equalize the treatment of new ownership construction and new rental construction in planning and fee schedules so that one isn’t privileged over the other.” Such fees include the “Affordable Housing Unit Base Fee” and the “Affordable Housing Unit Development Cost”, and all other related fees and development conditions.
Currently, the city is proposing rates of $43.91/sqft for apartment construction and $51.30/sqft for condo construction for the above fees. This puts condo purchasers at a clear disadvantage to rental landlords.
Corporate landlords are reaping future wealth appreciation whilst market-rate renters have no rent control protections and accumulate nothing. If built as condos instead, owner-occupiers would gain housing security, price stability and could grow wealth.
One of the findings of the Housing Commission report is that the affordability of for-sale, market-rate housing can be improved with the construction of entry-level condos instead of apartments on our boulevards
Many of the high-density apartment buildings going up on our boulevards are rented by the working classes, and so would also be affordable by those same people to buy if built as condos.
Furthermore, inclusionary units in those buildings could be sold as deed-restricted condos instead of rentals, and so would benefit low-income Santa Monicans also.
There is no possibility of a shortage of market-rate rentals as our city is flooded with new supply. But there is a critical shortage of newly-built, entry-level, market-rate for-sale housing.
The current fee structure means that only a very small number of (high-end) town-home style condos get built. But via fee-equalization, higher-density, lower cost condos could be built along our boulevards, not just rentals.
Item 5-C
October 8, 2024
Item 5-C
October 8, 2024
2 The council should require staff to equalize the aforementioned fees. Furthermore, the council should ask staff to research all other development aspects (parking, setbacks, density etc.) where for-sale housing is disadvantaged to market-rate rental-housing, and equalize them if currently not – including for those being built as ‘builders-remedies’.
In equalizing the fees, either the landlord fees can go up, or the condo fees can come down, or they can meet somewhere in the middle. But note that, relative to the number of apartments in the pipeline, almost no condos are being built. So, to maintain proposed funding, whichever method is chosen, the landlord fee might need at most a trivial rise, if any, from the currently proposed fees.
Currently, corporate landlords are favored by the city and grow wealthier. But working-class residents who want to own their own homes at an entry-level price are being shut out by the city. The current situation must be rectified.
As HUD’s proposed new rule re “Affirmatively Furthering Fair Housing” states:
“Inequality in access to homeownership has created a ballooning wealth gap among racial and ethnic groups. Homeownership is generally the most traditional and stable way for a family to accumulate wealth.”
And as the Housing Commission report says:
“Homeownership confers numerous benefits in addition to stability. It contributes to lower and more controlled long term housing costs, builds personal and multigenerational wealth through appreciation, enables environmental customization, and provides a means of selfexpression. Homeownership fosters pride, builds social equity, and strengthens community.”
Indeed, some on our council may already own their homes, and can vouch for the very real benefits that ownership brings, and why it should be available to many more families in our city.
Yours sincerely,
Peter Borresen - Santa Monica Housing Commission Vice Chair.
With the consent of Gail Gordon - Santa Monica Housing Commission Chair.
Item 5-C
October 8, 2024
Item 5-C
October 8, 2024