Access to affordable housing is the area’s number one challenge to future prosperity, said Mike Carnathan, manager of research and analytics for the Atlanta Regional Commission.
Home prices nationwide are six times what they were in 1980, he said.
“A lot of that increase has happened, really, in the last three years,” Carnathan said.
Not enough new housing is being built, and sales of existing homes are down, he said.
In the Atlanta region only 40% of listings are affordable for families making less than $100,000, Carnathan said.
Atlanta has the sharpest rise in home prices among the nation’s 15 largest metro areas, he said. It’s fourth in rent prices, but near the bottom of wage growth in those 15, Carnathan said.
“Every time we look at these numbers, it paints a more dire picture,” he said.
Local governments need to preserve the existing supply of affordable housing, cut housing-related costs such as the expense of commuting, and collaborate with the private sector to pump more money into the housing system, Carnathan said.
Governments can’t affect things like demand, construction costs and local trends, but can offer flexibility on zoning and building permits, many financial aspects of homebuying, and handle the reaction to public pressure, he said.
Jonathan Tower, founder of Arctaris Impact Investors, praised Atlanta as having “so much strength right now,” but said the amount of empty downtown office space is a looming concern. He cited a current story in The Atlanta Journal Constitution on the possible bankruptcy of co-working facilitator WeWork.
“If WeWork goes, then what?” he said. Tower drew an analogy with Rust Belt cities a half-century ago that failed to clear away closed factory buildings for redevelopment.
“I’m not saying that offices need to go away,” he said. But nationally there is a 30% decline in downtown office attendance and a 15% decline in those areas’ foot traffic — a situation that may persist for at least 15 years, Tower said.
Atlanta could see a 2.5% decline in its property tax revenue, and sales tax losses too, he said.
That makes now the first time it has made sense to buy up office space and convert it to residential use, Tower said. Offices are hard to convert to housing, but it can bring many benefits to help offset the lost tax revenue, he said.
Doing so, however, will require work and change from local governments: flexible permitting, tax abatements, contribution of government-owned land, even direct subsidies, Tower said.
In return, governments could require high proportions of affordable housing and use of diverse subcontractors.
He estimated 1,000 area properties could be converted from office to residential, with government property as a prime target.
Arctaris focuses on revitalizing underserved communities, often providing 80% of the needed investment in a public-private partnership, Towner said. The firm is talking to Atlanta about investing “significant capital” in a community program here, he said.
Tony Perez, senior associate at Opticus Design, said he has spent years reviewing zoning codes nationwide — and many of them need to change to deal with the housing crisis.
One place to look is along dying or underused commercial corridors. Areas in between thriving commercial sites should allow housing, he said.
“Every city has some version of this,” Perez said.
Another possibility is allowing multiple units on land now zoned for single-family housing, which five states and several large cities are doing, he said.
“This is super controversial, as you might expect,” Perez said.
Single-family lots take up huge amounts of land within city limits; 85% of Sandy Springs is zoned for single-family use, he said.
Peoples’ desire to live in single-family neighborhoods should be respected, but allowing multi-unit housing in areas that back up to major traffic corridors might make sense, Perez said.
Accessory dwelling units, tiny houses, and house-sized apartment buildings should be considered in some areas too, he said. But doing so will require rethinking cities’ comprehensive plans and zoning codes, and moving to more objective standards for permitting decisions, Perez said.