HUD policies on Fair Housing, Affordability, thrust HOAs into the federal spotlight

by Deborah Goonan

On July 16, 2015, HUD issued its final rule on Affirmatively Furthering Fair Housing (AFFH). You can read about it here:

Over the past several weeks, AFFH has generated considerable political controversy, at least among those of us who are interested in land use and housing policy in the US.

Here are some highlights:

Political ramifications are explored in this NYT Op-Ed by Thomas B. Edsall:

The Supreme Court and HUD have together set in motion a major test of middle- and upper-middle-class white America, which will determine whether support for racial equality goes beyond calls to lower the Confederate flag, beyond demands for stricter oversight of the police in minority neighborhoods, and on to a willingness to tolerate racial change in the house next door.

Read the entire editorial here:

The Critique, written by Stanley Kurtz in the National Review:

Attention America’s suburbs – you have just been annexed

“It will take time for the truth to emerge. Just by issuing AFFH, the Obama administration has effectively annexed America’s suburbs to its cities. The old American practice of local self-rule is gone. We’ve switched over to a federally controlled regionalist system. Now it’s strictly a question of how obvious Obama and the Democrats want to make this change — and when they intend to bring the hammer down. The only thing that can restore local control is joint action by a Republican president and a Republican congress to rescind AFFH and restrict the reach of disparate impact litigation. We’ll know after November 8, 2016.”

Read more at:

These two articles tell us that housing is most definitely and issue of national political concern and an issue for the 2016 Presidential election. By extension, because 80% of new construction requires the establishment of common interest communities, homeowners’ associations (HOAs) WILL HAVE TO BECOME PART OF THE NATIONAL CONVERSATION. But read on.

A supporting viewpoint, written by Henry Grabar, Salon: (emphasis added)

The incredible shrinking megacity: How Los Angeles engineered a housing crisis

“It wasn’t always this way. According to Greg Morrow, a planner and professor, Los Angeles had a residential capacity of 10 million in 1960. In the years since, that has fallen by 60 percent, as the city turned over planning responsibilities to communities. Local control led to lower densities, larger minimum lots, parking requirements and setbacks.

In Morrow’s dissertation, he neatly sums up the varied effects of four decades of community control. Poor, largely minority neighborhoods have borne the brunt of new construction. Affluent, largely white communities have effectively thrown up the gates.”

“It’s planning apartheid,” Morrow told me when we spoke last month. “You have essentially a minority of a minority of a minority who determine the housing policies for the vast majority of Angelenos.” The first minority are homeowners; the second, those engaged in land use issues; the third, those who have the time and money to litigate.

1. “Los Angeles homeowners, like the Sicilians in ‘Prizzi’s Honor,’ love their children, but they love their property values more.”
2. “‘Community’ in Los Angeles means homogeneity of race, class and especially, home values….”
3. “The most powerful ‘social movement’ in contemporary Southern California is that of affluent homeowners, organized by notional community designations or tract names, engaged in the defense of home values and neighborhood exclusivity.”

Read more here:

Without explicitly saying so,the Salon article clearly references affluent gated communities, HOAs, as the primary mechanism for exclusion, an artificially induced housing shortage, and resulting lack of affordability.

Meanwhile, affordable housing advocates and Civil Rights groups have been compiling research data of the effects of community income levels on children, and their future social mobility.

Where You Grow Up Makes a Huge Difference in Your Salary as an Adult

“There’s a 7.5 percent chance someone born into the bottom fifth of America’s income distribution gets to the top fifth, Chetty said during his presentation. A kid born in Canada has a 13.5 percent chance.

“Your chances of achieving the American dream are almost two times higher if you’re growing up in Canada,” Chetty said. ”
“We find that every year of exposure to a better environment improves a child’s chances of success, both in a national quasi-experimental study of five million families and in a re-analysis of the Moving to Opportunity Experiment. We use the new methodology and data to present estimates of the causal effect of each county in America on upward mobility.”

There is no question that there is a concerted effort AT THE FEDERAL LEVEL to illustrate to decision makers  and voters alike that reducing segregation by income level – closely related to minority status –  is not only beneficial to those at the lower end of the socioeconomic scale, but also to middle and upper income taxpayers. Besides the intrinsic value of improving their quality of life, the better the economic outcome for today’s children, the more we reduce the need for income and social supports in the future.

We cannot have a national discussion about AFFH and Affordability without also addressing the fundamental economic and governance structure of Association-Governed Residential Communities.

Proliferation of homeowners’ and condominium associations over nearly 5 decades has not increased homeownership rates or housing affordability. But the exclusive nature of HOA corporations, with their ever-increasing numbers of rules and restrictions, has perpetuated the division between the haves and the have-nots, through creation of over 330,000 private communities specialized into niche markets that stratify people by income, education, age, and race.

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