By Atticus LeBlanc, Stryant Investments
According to Realtor Magazine, Atlanta places 2nd in the US for largest average house size at 2,074 square feet (sf). Based on recent data from Yardi Matrix, an apartment market intelligence source, Atlanta also has the largest apartment sizes in the country, averaging over 974sf per apartment. Given the current ratio of single family to multifamily units and a city population of 463,878, we have an average of 590 square feet of housing space for every individual in the city of Atlanta. If we can increase spatial efficiency by just 25 square feet per person, we can create 20,723 units of affordable housing. . . just within the city limits.
These additional units would take the form of small multifamily dwellings, garage apartments, and co-housing both in existing single & multifamily dwellings as well as new structures. While the creation or modification of houses into duplexes would have obvious benefits to a landlord as well as reducing rents, the development or conversion of existing large homes into smaller condominiums could also create additional opportunities for increased affordable homeownership as well as higher profitability for owners and developers.
Co-housing in existing single-family dwellings has the greatest potential to create affordable housing for thousands of individuals who currently cannot afford any area apartment without subsidy. Co-housing units contain a shared kitchen, laundry, and common area, while maintaining private sleeping accommodations that are each rented separately by unrelated individuals. The Landlord retains responsibility for providing all utilities and furnishings, and charges a consistent all-inclusive rent amount. Under a co-housing model, it’s possible to provide quality housing to single minimum wage earners or SSI recipients that would otherwise be unable to afford any housing option available without a subsidy. Interestingly, the owner of the co-housing unit should earn a 20-30% higher return on investment than on a similarly sized standard rental unit.
Because all these housing types provide an opportunity for higher investor returns than typical single-family units, market forces will create additional affordable housing units if allowed to do so, without the need for any additional public subsidy. Unfortunately, zoning codes throughout the Atlanta area create a significant barrier to housing affordability by restricting and/or eliminating affordable housing units that would otherwise be created by the market.
While a significant body of research has demonstrated the benefits of mixed-income communities and the dangers surrounding the concentration of poverty, our existing zoning codes continue to restrict or eliminate affordability. Fortunately, the city of Atlanta has finally acknowledged the need to overhaul their zoning code to encourage the creation of affordable housing across the city and is proposing a re-write of the code. But today in the city of Atlanta, it remains illegal to create a garage apartment unit in most single family residential districts. It is illegal to operate existing duplexes, triplexes, or multifamily dwellings in most single family districts if those structures have been vacant for more than 6 months. And it is illegal for more than 4 unrelated individuals to occupy the same single family residence, or create co-housing in single family districts. If Atlanta is successful in addressing these underlying zoning issues that are currently restricting and eliminating affordability, the market will have the opportunity to create large numbers of affordable housing units throughout the city. But can we expect surrounding jurisdictions and suburbs to follow suit?
The raison d’etre of many suburbs is exclusion—using zoning requirements to make it essentially impossible for low income households to afford housing… If we want to make the biggest difference in economic integration, we need to try to integrate low-income neighborhoods as well as high-income neighborhoods. –Joe Cortright, City Observatory 3.29.2016
Since so many Atlanta communities were developed as suburbs and bedroom communities that were then absorbed by metropolitan growth, much of our zoning code still maintains the single family zoning district as a sacred cow, even if the community is politically in support of affordability. Within these districts, we have homogenized the types and sizes of housing that can be constructed. Regardless of whether you’re in Decatur or Dacula, single family districts are restricted to single family homes, with large minimum square footages, that prevent the construction or redevelopment of affordable units or the subdivision of these lots and homes into multiple dwellings.
Interestingly, some of the most popular and desirable neighborhoods in the area were developed more than a century ago with a mix of unit types and uses almost adjoining each other (Grant Park, Inman Park, Ansley Park, West End). If we could allow the organic creation of multiple housing types and uses in the 19th and early 20th century, why would we prevent ourselves from having the ability to re-create these beautiful neighborhoods? If our communities truly value affordability, diversity, walkability, shouldn’t our zoning codes reflect those values?
Our proposal seeks to address these incongruities between the need for affordable housing and the zoning codes that restrict the increase of affordability, while also demonstrating to developers and investors the possibility to earn greater financial returns through the creation of smaller and more affordable housing units. We plan to empower the marketplace so that private investors are motivated (without any public subsidy) to create more affordable units, and we plan to demonstrate to public jurisdictions how flexible zoning codes can increase affordability and quality of life for all residents, while reducing the burden on public entities.