Atlanta must make a choice about its future. Does it want to be a city only for the rich, or a city for all? Does it want to push the poor to the suburbs, merely moving the problems of poverty to its doorstep, an unsustainable situation? Or does it want to share the benefits of economic development with those who need it most?
From 2012 to 2014, according to the CoStar Group, 95 percent of the rentals built in Atlanta were luxury units. Meanwhile, thousands of families flooded the local rental market as mortgages got tougher to get and wages in the bottom 75 percent of the occupational structure remained stagnant. The market is producing few affordable, decent-quality rental units for those who need them most, especially near mass transit and jobs.
A boom in luxury apartments and higher-income renters can certainly bring benefits to the city and its residents — especially if developers are not given tax abatements or other goodies without needing to provide affordable housing. However, if few of the benefits of new development accrue to working-class Atlantans, many of whom may be displaced by higher rents or property taxes, what exactly is the point?
Government coffers may benefit, at least in the short run, but this is not the same thing as being good for the entire city, especially those priced out of it. From a regional perspective, if job growth continues in places like Midtown but there is no affordable housing nearby, traffic and congestion could worsen beyond the breaking point. Eventually, if only the highest-income workers can find adequate housing, employers will not see Atlanta as an attractive place to do business.
To its credit, the city recently articulated proposals to rebalance rental housing. In an extensive “Housing Strategy” document, Invest Atlanta, the city’s development arm, identified potential balanced development policies similar to thoseof cities that experienced similar development pressures, such as Seattle and Washington, D.C.
Many of these proposals, including a mandatory inclusionary zoning policy, are indeed welcome. However, for the rubber to meet the road, substantial political leadership will be required to get them adopted, implemented and enforced.
Moreover, the city and other key actors, such as Fulton County and the state of Georgia, should first make sure existing subsidy programs are implemented in a way to maximize the production of truly affordable rental units, especially for households with incomes below 50 percent of the median, where housing cost burdens are by far the greatest.
Fulton, for example, should immediately announce it will no longer provide tax abatements for rental developments without meaningful (at least 20 percent) set-asides of affordable units. The city – and ideally the state — should require all Tax Allocation Districts to include affordable housing, including at least 20 percent affordability.
Affordability must include substantial requirements not just for those with moderate incomes — from 50 to 100 percent of the median — but for those with incomes below 50 percent of the median, where housing costs eat up a much greater share of income.
Affordability requirements should last at least 30 to 45 years. Permanent affordability, through deed-restricted covenants and other tools, should be required wherever possible. And all development agencies — including Invest Atlanta, the Atlanta Beltline Inc., Fulton County and the Georgia Department of Community Affairs — should provide detailed data on rents and affordability commitments for all housing they have financed in recent years, and they should make sure such data are easily accessible on the web.
To developers who might initially resist some of these recommendations, I suggest they take a broader view. A city of the rich is simply not sustainable. In the short run, it will increase class-based tensions within the city and region, which will lead to civic instability. Regional cooperation to fix transit systems and other problems will be hobbled by increased factionalism.
From a perspective of real estate fundamentals, an overly narrow development pattern will likely result in another real estate crash, something that will not be good for anyone. In the long run, we really do share the fate of this city. Inclusiveness is a necessary ingredient for a truly successful and sustainable city.
Daniel Immergluck is a professor in Georgia Tech’s School of City and Regional Planning.