Town Must Lower Prices For Housing

Then you, my friend, might just be able to buy a house in Chapel Hill.

After all, the average price of an abode in town was $219,050 in 2001, according to the Orange County Economic Development Commission.

That prohibitive price tag means that a lot of the people who keep Chapel Hill running -- policemen, teachers, University staff -- can at best afford to rent a home or an apartment.

And even the current stock of modestly-priced homes is shrinking.

The reason? When a reasonably priced house goes on the market, developers often rush in to buy it. They then turn them into rental units with exorbitant monthly rents -- attracting UNC students who can afford to live off campus.

A middle- or low-income worker has to tread through bank bureaucracy to get a loan. Cash-laden developers do not. The result is that the affordable housing market in Chapel Hill diminishes year after year.

The Chapel Hill Town Council isn't deaf to this matter. For years, they've emphasized affordable housing for the town in order to maintain some sense of diversity and prevent the creation of an ultra-elite community.

The body furthered that aim last week. A $150,000 loan fund was established by the town, from which nonprofit organizations can borrow money to buy existing affordable houses -- before developers can step in and grab them -- and later sell them back to lower-income workers at almost no cost to the nonprofit. The organizations have three months to pay back the loans with no interest. All the homes go into the Orange Community Land Trust so that the properties remain affordable if sold in the future.

The project should show results shortly. Several nonprofits working to create affordable housing, such as emPOWERment Inc., already plan to use the fund to buy houses in the Pine Knoll and Northside neighborhoods.

Along the same line, another affordable housing option will be coming before the council later this month.

Nearly two years ago, Chapel Hill passed a "small house" ordinance -- meaning developers had to include a percentage of houses under 1,350 square feet in any proposed neighborhood. The thinking was that smaller houses would lower the price.

That hasn't been the case. Often, developers will cluster the lower-priced homes in one corner of the neighborhood. Or they build rooms such as sunrooms, attics and garages that don't factor into the space restrictions.

The result: neighborhoods have not diversified as the council had hoped.

The comprehensive development ordinance the Town Council hopes to approve later this fall will address affordable housing. Most likely, it will combine the idea of the small house ordinance with a planning concept called "inclusionary zoning."

Under inclusionary zoning, building affordable housing in a development would be a requirement. Instead of making smaller houses and hoping they sell for less, the council would set a percentage of homes priced affordably.

The idea of inclusionary zoning can get a trial run in Chapel Hill now.

An 86-home subdivision called Lakespur is slated to be built in the northern part of the town. The developer, Carol Ann Zinn, wants the Town Council to exempt the development from the small house ordinance. Under that provision, Zinn would have to build 22 homes under 1,350 square feet. She proposes an alternative: something mirroring inclusionary zoning.

Zinn proposes building 13 larger houses and selling them between $100,000 and $130,000 -- well below market price.

The properties would then be placed in the land trust run by Orange County Community Housing.

The Lakespur request should go before the council late this month.

In the battle to keep housing around town attainable for blue collar workers, the Town Council should look to every front available.

The council has made strident steps already -- and it has a chance to advance affordable housing further.

Columnist Jonathan Chaney can be reached at jhchaney@email.unc.edu.