↗URBN 1000: Introduction to CitiesPart 4: Urban Issues: Housing and PlanningClass Outline: ➢ Housing 101➢ Housing and income➢ Federal Housing Acts of 1930s➢ Public housing➢ Housing and racismHousing categories↗ Owner occupied:↗ Emphasis on homeownership↗ National bias towards ownership↗ Tax incentives towards ownership↗ Houses, condos, townhouses↗ Rental: (year lease, month to month lease)↗ Publicly owned housing or public housing↗ Assisted living, senior housing ↗ Group homes & institutions↗ http://www.theadvocate.com/new_orleans/news/business/article_d2697796-6860-11e6-98ab-5bcccc227433.html?sr_source=lift_amplifyNOLA Real EstateHow does housing reflect income?↗ Cost of house itself depends on location and size↗ 2/3 of all householders are homeowners (1/3 are renters)↗ Access to goods and services, such as grocery stores, hospitals, libraries, entertainment, green spaces↗ Housing as asset: biggest indicator of wealth in the U.S. is owning a house (homeownership) ↗ 75% of whites own homes; 46% for blacks; 49% for Hispanics↗ Intergenerational transfer of wealth↗ Investment, renovations, selling it during an economic boomFunding Public Education↗ Locally, property taxes fund public schools↗ 1991: range $3000-$15000/student↗ Unlike affluent communities, poorer urban neighborhoods lack the tax base to provide adequate per student expenditures, even with additional state aid↗ Detroit 2010: closed 25% of its 172 public schools due to lack of fundingSocial stratification ↗ Social stratification: the ranking of people into a social hierarchy based upon their access to resources in society ↗ Income: the earnings of a family (eg: $45,000/yr)↗ Wealth: income + lifestyle/assets↗ US has the most unequal distribution of wealth in the West↗ Wealth=marketable assets: real estate, property, stocks, cars, boats, investments, etc↗ biggest indicator of wealth= home ownership↗ Housing crisis of 2007-2012; 10 million foreclosures 2007-2010↗ Poverty: poverty line for a family of 4 in U.S. in 2010=$22,314Housing affordability↗ Cost burdened: Paying >30% of your income for housing is cost burdened (according to the US Department of Housing and Urban Development, aka HUD)↗ But 30% of $1000 is not equal to 30% of $5000↗ A family with one full time wage earner earning minimum wage cannot find an affordable 2 bedroom apartment anywhere in the U.S.Housing cost burdened in New OrleansNumber of WorkersMedian Annual EarningsAffordable rent + utilitiesFood preparation and serving related occupations20,829 $17,608 $440Building and grounds cleaning and maintenance occupations11,217 $19,471 $487Personal care and service occupations 11,524 $19,585 $490Healthcare support occupations 7,795 $22,864 $572Fire fighting and prevention, and other protective service workers including supervisors5,131 $27,654 $691Material moving workers 5,578 $27,808 $695Office and administrative support occupations54,474 $28,859 $721Motor vehicle operators 8,793 $31,150 $779Community and social services occupations6,873 $34,837 $871Federal Housing Policies 101↗ 1930s Great Depression and federal government initiatives to stimulate the economy:↗ During the Depression, residential construction dropped by 90%!!↗ Buying a house: detached single-family suburban house ↗ Private property and rights of homeowners: defining “citizenship”↗ Guaranteed low-interest long-term mortgages↗ GI loans allowed working and middle class to afford suburbiaFederal Housing Policies 101↗ Housing Act of 1934: created the FHA (Federal Housing Administration) to ensure home loans↗ Housing Act of 1937: established the U.S. Housing Authority↗ slum clearance program to demolish substandard tenements and then build “standard” low-rise public housing in its place↗ GI Bill 1944: guaranteed VA loans to vets returning from war↗ Banks and lenders decided who gets loans and government acted to insure the banks against loss if the buyer defaulted↗ Housing Act 1949: public housing & downtown “urban renewal”↗ “eminent domain”, “slum clearance”, “Negro Removal”; stadiumsHousing and Racism↗ Exclusionary zoning practices: explicitly racist federal policies↗ Redlining↗ Blockbusting↗ Racial steering↗ Racial CovenantsRedlining↗ Redlining: the process of delineating on maps (through the use of red lines) areas where banks would not provide loans and mortgages↗ Minority inner-city neighborhoods deemed ineligible for long-term mortgages because banks would not authorize loans for redlined areas↗ Led to decay of minority inner-city neighborhoods maps based on assumptions (about race) not actual ability to meet the satisfied requirements for the loans ↗ Abolished in 1968, Fair Housing ActRedlining: Grading Metrics ↗ How to get a loan, 1936 Philadelphia (but other cities, too)↗ A= “most desirable”↗ B= “still desirable”↗ C= “declining”↗ D= “risky”, ↗ “redlined”Blockbusting↗ Blockbusting: ↗ business practice of U.S. real estate agents and building developers ↗ designed to encourage white property owners (through perceived fear) to sell their houses at a loss for profit, by insinuating that racial minorities were moving into their previously racially segregated neighborhood, thus depressing real estate property values.↗ Was federally endorsed 1940s-1970s and ended by the 1980sSteering↗ Steering: real estate agents steer blacks (or another racial minority) to predominantly black neighborhoods (and vice versa)↗ Failing, on the basis of race, to show or inform potential home buyers homes that meet their desires and specifications, thus perpetuating racial residential segregation ↗ In certain documented cases, even when the socioeconomic status is held constantRacial Covenants↗ Racial covenants: primary intent was to keep white neighborhoods white and for real estate developers to “protect” subdivisions↗ A deed (covenant/contract) that forbid the buyer of a house from reselling, leasing, or transferring property to persons of a certain race, ethnicity, or religion (as dictated by the house deed) at any point in the future in order to maintain homogeneity (i.e., to keep investment and high property values)↗ 1920s-1960sRacially restrictive covenantsHave Things Changed Today?Affordability: Redeveloping public housing↗ public housing was originally marketed to white families who were in transition