When more people live closer to each other and to destinations, they will ride bikes more. That’s one reason housing and land-use is crucial if we want to reach our bicycling goals.
This week Portland City Council is hearing two days of public testimony for the long awaited Residential Infill Project (RIP). The hearings are scheduled for Wednesday January 15 at 2:00 pm and Thursday January 16 at 5:00 pm. On Friday night I attended an information session at Lucky Lab in northwest organized by Portland Neighbors Welcome (along with SunrisePDX, Business for a Better Portland, and No More Freeways).
Here’s what I learned…
The Residential Infill project will re-legalize duplexes, triplexes, and fourplexes in single family zones. 40% of Portland’s land area is currently zoned for single family housing and is expected to absorb twenty percent of Portland’s population growth. It wasn’t always this way. Portland’s first zoning plan was approved by voters in 1924, at a time when the Klan was running Oregon politics. Single family zoning was extended to more areas of the city in 1959. These decisions still impact housing prices today.
The latest version of the RIP draft (PDF) allows more flexibility for housing options up to fourplexes. Why four? Splitting land costs four ways has a significant affordability boost compared to three units. Homes with up to four units are considered residential and not commercial properties in banking and are available for a standard mortgage.
A key to the proposal is that maximum homes sizes are set to significantly decrease from what is allowed today, effectively ending demolitions of single family houses for much larger single family houses. On an R5 zoned lot the maximum house size will decrease from 6,750 square feet to 2,500 square feet for one unit. If more units are built, the maximum building size can increase to 4,000 feet.
Other notable items include:
- Eliminating parking minimums.
- “Visitable” ADA access for at least one unit on lots with 3-4 units. Visitable means no step entries, ground floor bathrooms, and wider doorways.
- Larger basement ADUs in existing houses.
Bureau of Planning and Sustainability Commission analysis showed that “there is a net reduction in displacement pressures across Portland as the result of the proposals.” Much like today though, displacement is not evenly spread out among neighborhoods. Julia Metz, an affordable housing developer with Catholic Charities, cautioned against using displacement models and maps too literally. “There has also been some chatter about removing some of the areas that are noted as being at-risk of displacement. If you remove those spaces you also remove the opportunities for affordable housing developers to get in there and build affordable housing.”
The Willamette Week recently reported that Commissioner Eudaly would like to see additional anti-displacement measures such as right of first refusal for tenants to purchase their property and city funding to help low income homeowners finance these projects.
Portland Neighbors Welcome is proposing a deep affordability option, where affordable housing developers could build up to eight units for housing affordable to families making 60% or 80% median family income. Neil Heller illustrated (below) how these units could stretch out public subsidy dollars further by helping more people or be able to provide even deeper subsidies.
When asked if supporting this option would delay the RIP even more, Heller responded that this potential amendment wouldn’t require any additional funding. Organizers pressed the need to get RIP passed as soon as possible, and that the Bureau of Planning and Sustainability could work on additional proposals to improve it after adoption.
Excited? Want to testify?
Portland Neighbors Welcome says it will be a packed hearing and people can sign up early on the 15th and expect the list to overflow to the next day. If this happens to you, make sure to check-in on the 16th. Supporters of RIP are planning on wearing blue to city hall. Testimony can also be submitted online to the Map App for both general and property specific comments.
For your testimony speakers recommended being specific and personal. What does affordable housing mean to you? Metz recommended that you use specific dollar values for incomes and rent or mortgage costs. Humanize who these policies will help. Low income residents include home healthcare workers, teachers, and seniors on social security. It’s likely that hundreds of people will be testifying over the two days, so make yours memorable by sharing personal stories of your housing experience in Portland, and what RIP would mean to you.
Thanks for stepping out of the bike box. Portland will never be a home for all bike riders if we don’t have homes for all Portlanders.
CORRECTION: This article originally had the days of this week’s hearings wrong. They are on Wednesday and Thursday. And the lead photo was taken by Henry Kraemer, not Doug Klotz as originally stated. We regret the errors.
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I am old, and I’ve been lucky to have been able to live most of my life in the ‘burbs. There’s a reason why the ‘burbs are the most popular housing choice in the US: people like it the best. People like having some space for kids and pets to run around and play, and some space to entertain guests and to garden and to be shaded by tall trees in summer. People like having some separation from neighbors, so you don’t sneeze and your neighbor says bless you. People like it so much that they are willing to go hundreds of thousands of dollars in debt and work long hours to get it.
I can understand why young people, who are packing these meetings and hearings, might think it’s a good idea to replace the ‘burbs with really dense housing, since young people have been largely shut out of the America dream of owning a home in the ‘burbs. You think that you’ll now be able to afford a unit in a triplex or a four-plex. And if you do, fine. But my guess is you won’t like it: you will long for some living space, which your triplex or four-plex won’t really provide, and if you live next door to a triplex or four-plex, you won’t like how your neighbors impinge on your living space.
I don’t see why cycling advocates (looking at you, J.M.) present the RIP as some nirvana for cycling. It’s not an either-or thing – either we have extreme density or we cannot cycle to work or the store. We can do it now – some of us are doing it now. We can also run bus routes through suburbs – we are doing it now. Sure it would work better if more people got out of their cars and took the bus, but that’s not a function of density.
I predict the RIP will gradually destroy Portland’s suburbs and displace the people currently living in them, who will move further out to have the lifestyle they want and then need to drive more to get to work and to the store etc. It will have the opposite effect of the one RIP supporters envision.
Want to build dense? Go for it! But the RIP is a “have your cake and eat it” scenario.
RIP is as much about choice as it is about density. Right now if you want to live close to town you can live in a hotel style apartment building or you can buy / rent a single family home and hope you can afford it. I’m not convinced this will solve all of our problems (I would bet most people don’t think that) but if we keep with single family housing only our problems or traffic, housing cost, and class / racial inequality will keep getting worse.
I disagree with you Fred. I don’t think the ‘burbs are the most popular choice because people like living in them. I think they’re the most popular because of how the system has forced so many people to live in them. It’s similar to how people say, “We must keep building and widening roads, because people love cars and driving is the most popular form of transportation.” I disagree with that because driving isn’t popular, it’s just what our system forces people to do.
Do you realize that much of the world – even older people – live in dense places? And they much have better social/health/cultural/environmental outcomes than we do?
And FWIW I don’t think RIP is “nirvana”. I think it is a necessary step to give people more housing choices and help us have better social/environmental outcomes.
I think the ‘burbs, in America, were the preferred place to live for quite a few decades. Preferences were guided by redlining, where banks would lend money for construction and mortgages.
RIP is a City of Portland policy proposal and by definition has nothing to do with the suburbs.
I think Portland residents confuse new housing with increased density. Having lived in Portland for 17 years (1997-2015 minus 1 year), I’d describe the city as a predominantly low-density bedroom suburb with a thriving downtown, of the industrial cities of Vancouver WA, Gresham, CTC, and Washington County – a donut-shaped city where the inner core is less dense than its outer areas, like Buffalo or Detroit only a lot richer. There’s not enough people in the Northwest Quadrant to support a high school and barely enough for a full-service supermarket, in spite of all the wealthy “density” in Uptown and the Pearl. The real density is east of 82nd where poorer folks are crowded into “affordable” old 1970s woody-walkup apartments, where most of the city’s population growth is actually occurring.
You’re allowed to describe Portland however you want, but it doesn’t really change the fact that the City of Portland is not a suburb.
His point is that much within the city limits of Portland is suburban-ish in nature. Portland is a rare city in having so many single family homes so ridiculously close to downtown. I think that was honestly a lot of its appeal to many for so long. You had the best of both worlds. A single family house and a little yard that was super close to most everything you wanted. Was/is that sustainable? That’s a completely different question.
I don’t know how rare it is… most American cities I’ve spent time in are similar to Portland in this way: Minneapolis, Boston, San Francisco all have large areas of single family housing in close proximity to downtown.
You are right that that’s part of Portland’s appeal, that that may be why attempts to change that are meeting with so much resistance from people who don’t want to change their city into something different.
That’s fair. Maybe it was more that up until 10 years ago that housing was relatively cheap, compared to the other cities.
Portland still is relatively cheap compared to other west coast cities, and also compared to many on the east coast (including dense NYC). I would argue that that’s part of what’s driving our rapid population growth, and that it will continue (regardless of what we do) until prices reach some sort of parity.
John, a suburb is a place with lower density, and doesn’t need to be a separate city or outside of the city. You can live within Portland city limits and be in a suburb, or you can be in an urban part of Beaverton (downtown Beaverton).
“A suburb is a mixed-use or residential area, existing either as part of a city or urban area or as a separate residential community within commuting distance of a city.”
For reference, in case anyone is interested, here’s a current map of Portland density:
The highest-density areas are NW and Belmont/Sunnyside areas. East of 82nd the lot sizes are larger, so even though there are some large apartment complexes, the overall density is lower.
“People like having some space for kids and pets to run around and play, and some space to entertain guests and to garden and to be shaded by tall trees in summer. People like having some separation from neighbors, so you don’t sneeze and your neighbor says bless you.”
There are lots of ways these things exist in dense neighbourhoods:
– PARKS: they are great for playing, and you don’t have to mow the lawn. When I lived in Vancouver, BC in a neighbourhood of low-rise apartment buildings I literally had a park on either end of my block. All the grass/trees/flowers without any of the work. All the hours my partner and I currently spent mowing/weeding/maintaining our yard in Portland could be spent doing other things (like enjoying our neighbourhood parks).
– EXTRA SPACE: While these 4-6-8 unit building don’t have to include amenity rooms or variations thereof, they could. Co-op housing frequently includes community run space for exactly these purposes (large kitchen with room for entertaining/meetings, spare rooms that can be reserved for guests, etc).
– GARDENS: Not everyone wants to garden, but for those that do there is no reason why these units (2-4-6-8) couldn’t have garden plots available (especially as the ratio of built space to lot size shifts) AND/OR why we can’t have more community gardens.
– SHADE: Again, no reason why these units / increased density means removing shade trees.
– SEPARATION: While some people just want to be alone and not see anyone, plenty of people enjoy the benefits of neighbours. Who better to watch your cat while you go away for a few days or your kid for a hour while you run to the store. As for sound, there are So Many Ways to make apartments soundproof. (In my last apartment I rarely heard my neighbours unless I was talking with them).
I lived in Vancouver for a few years in a a series of apartments, and I echo what you say about having high quality openspace nearby and the time to enjoy it. There is a key difference between Portland and Vancouver: Vancouver funds its parks. New buildings get charged fees that get invested in roads, water, sewer, parks, community centers and schools; in Portland, the list ends at sewer. Portland has had an unprecedented building boom for the past decade, yet it cannot afford to maintain the parks it has and has been forced to close pools and community centers. There is an implied Civic compact where citizens trade-off density for public openspace, great schools, great transit, and safety- it is supposed to be more amenity-rich than the suburbs, but Portland is failing by neglecting to maintain its openspace ratios, and neglecting our schools and transit. IMO, Portland is far too interested in offering breaks/deals/enticements to developers to hasten the manifestation of their planning dreams. That said, I support the RIP, and I hope that Portland wakes up and starts investing in Parks and alternative transportation
You can disagree with the amount charged, but it’s not accurate that the City only charges development fees on sewer. For permits on new developments, changes in use or intensity (including new residences and those taking advantage of RIP), the city charges for sewer, stormwater, transportation, and parks fees. You can learn more if you’re thinking of adding an ADU- etc https://www.portlandoregon.gov/bds/article/166412
maxD, I hear you about more funding for parks (and just about everything else) in Vancouver. The amount of open space, the amenities at and number of community centres, and the recreation and cultural programming from the Vancouver Park Board is fantastic (full disclosure: I have & continue to do arts and other contract work through the VPB). That being said, I don’t think there’s zero hope for Portland and the future of open space, nor do I think Vancouver’s taxation system IRT to buildings should be looked to as a model (huge problems, as you know, with affordability in general and triple net leases which make it all but impossible to occupy space as anything other than a corporation).
First let’s address a couple of technical points. The Residential Infill project would only impact the city of Portland, so the suburbs would not be altered. Also, even if this proposal passes, the rezoned parts of Portland would be far from having “extreme density.” Extreme density is something that we can observe in cities such as Hong Kong where residential high-rises cluster into a small land area. In Portland, density would only increase modestly as some single-family units are replaced with duplexes, triplexes and fourplexes.
With or without this rezoning, the vast majority of the land available for residential housing in the Portland metropolitan area would continue to be occupied by single-family houses. Those families that are looking for a suburban lifestyle and a single family house would continue to have ample opportunities to live as they wish. However, up until now, it was literally illegal for those who wish to live in more liveable urban environments to do so. It was outlawed by zoning regulations. And it is quite probable that many of those workers who currently drive to the suburbs after work do so because no other options are available to them. These modest revisions to city of Portland’s zoning would merely give people the freedom to choose from different kinds of lifestyles.
Up until now we have addressed how zoning revisions would increase choices in the greater Portland metro area. Let’s also discuss about what you list as the benefits of living in a suburb. You claim that the number one reason why living in the suburbs is preferable is because it increases the living space for its inhabitants. I would argue exactly the opposite.
The living space inside one’s home obviously depends entirely on the square footage of a given residence—whether the home happens to located in the suburbs or in the city is irrelevant. The average amount of outdoor private space may in fact be greater in the suburbs than in the cities. While some suburban homeowners may take advantage of some of that space at least some of the time, if you drive through any suburb you will quickly notice that for the most part humans are nowhere to be seen. The only regular outdoor activity that the archetypal suburban homeowner seems to engage in is the mowing of the lawn, usually creating a vast grassy area that completely destroys the natural vegetation yet creates zero benefit to the people living on the property. Even children do not play much outdoors anymore. Since the suburbs are unwalkable and unbikeable almost by definition, if you do happen to spot a live human in the typical American suburb, he or she is most likely to be unhealthy, overweight, and increasingly, even morbidly obese.
The unhealthy lifestyle choices in the suburbs compound themselves. Because the residents do not have much opportunity to engage in any kind of physical activity, after a while they lose their natural desire for exercise and movement. Eventually, rather than taking whatever modest measures they could to counteract the effects of their detrimental lifestyle choices, they start to view physical activity as some kind of negative. They put much effort into ensuring that they can store their motorized couches as close to their intended destinations as possible. Circling around parking lots looking for the closest space to the store becomes normal, as if walking a few extra feet were something that a rational person tries to avoid as much as possible. As Mr. Money Mustache has pointed out, this process reaches its pinnacle of insanity with the drive-thru, an infrastructural invention that would make some sense if we were living on Mars where we had to get our “business done without ever coming in contact with the planet’s hazardously thin sub-zero atmosphere.” The suburban dweller loses his ability to move around his own body of his own accord.
Since a resident of the suburbs spends his entire existence in a hermetically sealed climate-controlled box, from his home to his office building to his motorized couch, he also loses his ability to acclimate to the changing of the seasons. Rather than slowly adjusting to the increase in temperatures as spring rolls around and we head into the summer months, he can only tolerate his air-conditioned environment. And this brings us back to all of that living space that we talked about earlier: most suburban homeowners would be horrified if someone were to suggest to him that he spend some time sitting, let alone exercising, outdoors if the temperatures are even slightly elevated from what he considers to be his comfort zone. The idea that the human body has great potential to adjust to a variety of outside conditions is entirely foreign to his way of thinking. He may have half-an-acre, an acre, or more private space, where all vegetation save grass has been meticulously destroyed, but for the most part all of it goes to waste.
Even more importantly, the land goes to waste exactly because it is private. Humans are social animals. We like to do things in groups, and only the rarest of us will have enough discipline and self-motivation to do something regularly if we are not motivated externally to do so.
In this slightly upzoned Portland, residents are more likely to have opportunities to walk or bike to work, to school, to the store, or to the park—and because it is a park, it is much more likely that we will have others to share our adventures with.
>>> However, up until now, it was literally illegal for those who wish to live in more liveable urban environments to do so. <<<
Really? I live in a very livable urban environment, and I don't think I'm doing so illegally.
I am referring to those areas of Portland that would be upzoned under these proposed regulations so that housing other than single-family homes would be allowed. In those areas, more densely populated urban have been outlawed. That is what single-family zoning does.
Your argument is essentially the same as me claiming that it is illegal to have a factory in Portland because I can’t build one in an R5 residential neighborhood (or in much of the rest of the city).
It’s just not true.
“It is not legal to build certain types of buildings in areas not zoned for them” is true, as is “it is illegal to build apartment buildings in Portland’s single-family residential areas”, but what those statements have in accuracy they lack in sensationalism.
I don’t know if I get this argument for affordability:
“A key to the proposal is that maximum homes sizes are set to significantly decrease from what is allowed today, effectively ending demolitions of single family houses for much larger single family houses. On an R5 zoned lot the maximum house size will decrease from 6,750 square feet to 2,500 square feet for one unit. If more units are built, the maximum building size can increase to 4,000 feet.”
Most of the skinny houses seen going up around the city (that replaced much more modest, affordable homes) are already way under 2500 ft^2. Many are in the 1400-1600 ft^2 range, and most are still at least $500K+.
I don’t think increasing density in places that can handle it (have decent ammenities like shopping, transit, etc.) is a bad idea. I’m just very skeptical that RIP will have much impact on housing affordability.
Does this proposal do anything for lot splitting (apologies, I haven’t read the most recent version)?
Iain MacKenzie has several examples of this on this Twitter thread: https://twitter.com/maccoinnich/status/1213981470764589057
Also if you read the replies you’ll also see the very good point that those “affordable” smaller, older homes are often in need of extensive repair, well beyond the budget and skill set of many potential homeowners.
I don’t know that I would consider the $340,000 condos in Iain’s post affordable.
2 Bedroom condos for $340K. I mean those examples did increase housing, but aren’t exactly like for like, as I don’t think people shopping for a house are all of a sudden going to switch searching to a 2 bedroom condo.
There are still a decent amount of houses under $350K in Portland. Some not THAT far out.
I’m also not totally buying the “well you’d have to spend more money to fix it up argument”. ALL houses (even new builds) will cost money, and that doesn’t factor in the HOA fees for these new condos.
My wife and I bought a house on 80th and Taggart, just south of Division, for $352k. Three bed, one bath, attached garage and and fairly large backyard. It was move in ready, all we did was paint. We have two parking spots in our driveway and are right around the corner from the Woodward bike Blvd. We can walk to Mount Tabor in 15 minutes, PCC is literally at the end of our street, we can walk to Winco, I can ride my bike to the Max or drive and park and the park and ride. We have a hundred restaurants to choose from in the Jade district or down Division within a mile from our house. And when want to leave Portland for the mountains, we just hop on 26 and head east.
We wanted to live closer in but didn’t want to go much higher than $350k and I’m glad we didn’t. Living out in the “numbers” has been amazing and the appeal of living close in only attracted me for the bikability to downtown, but not I have the option to trip chain it with the Max, that doesn’t matter to me anymore. I have friends that bought close in and they paid $150k more for their house than we did and what is interesting, our Franklin high school has a better rating than their Jefferson.
Dense urban living is great for the external amenities, but there are some trade offs. My wife and I lived in a condo off of 28th and Glisan for a year and a half and even though it was fun and hip, it was also very difficult at the same time. We didn’t have any space for our outdoor gear so we had to pay for a storage unit. Our dogs were miserable. There was no room to have a child. We couldn’t host get togethers or parties. Waking two blocks with groceries from parked car was a norm. I fought every single day hoisting my bike up the stairs from the basement parking. Peoples bikes got stolen from the basement. I couldn’t park my bike outside locked up because it would get vandalized or stolen. I could hear people having sex or watching loud movies. There were HOA fees. The only affordable grocery store was Fred Meyer and even that was kind of spendy. I actually live closer to a grocery store now than back then.
Buying a single family house 7 miles from town was the best thing we could have ever done. I know this isn’t an option for everyone but if you can get there, I think you might enjoy it more than having loud neighbors living above you with no safe place to store your bike.
No they are not affordable at all. They are simply more housing for the upper class people who can already afford to purchase a home loan. IMO, RIP is not about increased housing choice or affordable housing at all — it is simply another speculative real estate wealth transfer upwards.
I do not support RIP. I support the RIP reforms proposed by the antidisplacement PDX coalition as well as the proposed reforms that would allow for a “tenant opportunity to purchase ordinance” (developed by Living Cully).
We’ve done this before, in N/NE Portland in the 1990s. We got an increase in density, but at considerable cost to those living there. This time will be different, right?
$340k is upper class pricing? With an FHA mortgage that is 5% or $17k down payment, so a current mortgage payment of less than $1000 at 4% interest rates (higher than today). Add in taxes, insurance and MIP, and you are less than $1500 per month. This would be eligible to a household with income of about $58,000 (just over the median) assuming FHA limit of 31% mortgage debt to income. So, by definition, this can’t be upper class pricing.
Are HOA fees factored into that?
This zillow listing is putting this $310 condo (2/1, 910 feet) for an estimated $1752 with the HOA fees rolled in. But that’s not an FHA, which would require at least $100/month in mortgage insurance, correct?
(and in my experience these calculators are always way more conservative (i.e. lower) than your actual end payments).
All in, if you’re nearing $2K or more a month (in addition to whatever down payment you need, 20% conventional loan would be $62K), is that “upper class”?
HOA and Property Taxes are so variable I was kind of picking it up with the extra $500 per month. But, yeah, a $1750 mortgage would equate to a household income if about $68,000 gross to qualify for FHA. Not sure that is upper class, but it is certainly above the median.
Median income for a family of two (which could of course be a two-earner household) is $70,320 https://www.portlandoregon.gov/phb/article/731546
Buying a $340K condo on a pre-tax income of $70K seems like a bad idea. That household is going to be stretched pretty thin.
Median income for household of one is listed at $30K on your link, so there’s no way most single people are able to afford anything close to one of these condos. And even a two earner household would be really, really tight.
So maybe this does help affordability for the 75-100% income bracket, which would mostly just be the upper classes.
Many money sites usually recommend only roughly spending 2.5-3 times your annual income (pre-tax) on a home. Even for $70K that would only be $210K, and that’s without having much other debt (student loans, credit cards). Even a 4 times income standard (somewhat dangerous), would mean a household would have to be making $80K/year.
Using a multiple of annual income as a metric for buying a home is so rudimentary it would absolutely create misleading results. It doesn’t account for interest rates, property taxes, mortgage term, property insurance costs or HOA dues, all things that can either make a purchase more expensive or less as a proportion of annual income. Particularly in Portland with how property taxes are calculated. I would argue, if this is the metric someone finds necessary to simplify the home buying process, they are going to be way over their head when they actually get into the details, and are probably not a good candidate for home ownership. Looking at how the mortgage company analyses debt to income is a much more appropriate way to examine affordability on an individual basis.
@SERider median income for a household size of one is $61,530, per that link.
Thanks. I was reading that wrong.
Still doesn’t change my point that there’s a really good chance buying a $340K “affordable” condo is going to get someone making $61K/year pre-tax into some financial hot water. I’d be interested to see how many loan officers would make that loan.
We don’t have a “middle class” housing crisis in Portland. There are plenty of units affordable to people making 100% median family income. We have a low-income housing crisis that is comprised mostly of people who rent. The average income of a renter in the Portland area is ~28,000 (according to the census ACS).
This tragic wealth inequality is why free-marketeers (see below) love to use median family income as their measuring stick for “affordability”.
We financed $340k of our home at 4.5%. Our mortgage, PMI, insurance, and ESCRO is nearly $2,200 a month.
Thanks for that real info. And then add on $100-200/month for HOA fees.
You should refinance if you plan to stay in your home for a while, rates are nearly 1% inside of that today. Not accounting for any principal reduction you have already paid for, at today’s rates (3.75%), you’d almost be to $2,000 per month, so a savings of $2,400 per year. If you plan to stay in your house for more than 2-2.5 years, might be worth looking into.
I was implying that to purchase one of these “affordable” $340K condos one would then have to take on HOA fees.
Skinny homes derive from lot splits, so they either are replacing a single family house with 2 or more skinny homes (after splitting the lot), or they split off a portion of an existing property and add a skinny home to the existing house. It’s an expensive way to develop property, and thus it essentially forces the developer to maximize square footage to make a profit. Additionally, the methods and costs of construction are identical to any other single family home (no efficiency gains). Thus you end up with very large (compared to their footprint), quite expensive skinny homes.
This isn’t a good comparison to multiplex housing under the RIP. Under the RIP, the profit motive should lead to more, and more reasonably sized, units on a property. Acquiring a property to build 3 or 4 homes on the property without a split is more land-efficient. Constructing a multiplex should be quite a bit cheaper on a per square foot basis (there are some new costs compared to a SFH, but also greater efficiencies).
As to you last question, I don’t believe the RIP changes anything with respect to lot splits, just makes them less attractive.
the profit motive assumption requires that the developer of the assumed product can actually sell the units. If a developer can split a lot they purchased for $400k, the carried cost to each lot is $200k. They build a single family home on each lot for about $300k, their basis is $500k per lot for a home they may be able to sell in today’s market for about $725k depending on neighborhood, so gross profit of $450k combined. If they elect to follow RIP, and build a fourplex instead, the land cost per unit is $100k, cost per unit in construction is close to $150k, so per unit basis of $250k, or $1MM in aggregate, this is the same cost basis as two single family homes, so there are likely some efficiencies as you note. The two end units of the fourplex hold the highest value, say $400k, and the inner units hold the least as they are attached on both sides, and only have windows front and back, so assume value reduction to $350k. Gross profit on the sale of the 4 plex is $500k, an extra $50k over the two single family homes. If I am a developer, the next thing I am going to do is look at the housing market in the area I want to build and at least in Sellwood, the results would indicate many duplexes sitting while single family homes continue to fly off the market. Certainty of execution is much more of a driver than an extra $50-$100k, so I am building the two single family homes. Couple that with the fourplex likely needing HOA dues for common area maintenance (which must be included in the mortgage payment analysis), and the 4 plex is less desirable to build and sell. Some developers may be willing to pivot to renting, but that brings a whole host of issues with it and many are not in the business of being a property manager.
RIP has great intentions, but the housing market operates on fundamentals separate from “choice”, and RIP will not materially change the demand landscape by offering additional supply, ask condo developers how that has gone.
You nailed it, SERider. Advocates of RIP think it’s going to create more affordable housing. But I could, under the new RIP rules, knock down my single-family house and build a four-plex on the lot and sell each one for $500K – pocketing approximately $1.5M in the process. And it wouldn’t affect me at all, b/c I would take my $1.5M and move to a big house in another non-RIP neighborhood. The people who would really be affected are my current neighbors, who would be saddled with what is essentially a new apt building in their midst.
RIP is a gift to developers and to current homeowners who want to sell up and skip town. It will do little for people who currently live here and want to keep living here.
It’s worse than that, RIP actually enables developors to knock down rental housing and build ~2500 sq foot mini- McMansions on larger lots. Anyone who believes we won’t be seeing more of this is either naive or a closet supporter of more expensive single family housing (IMO, most YIMBYs fall into the latter category).
For example, this set of absurdly expensive 4 minimcmansions was built on one lot that could have been used to build a four-plex apatment building (essentially the same zoning by the anti-density YIMBYs):
Catie, Jonathan: the first picture credit is wrong. Doug may have sent it to you, but he’s in it and did not shoot it. Ask him who should be credited (and then delete my post).
I’m not a young whipper snapper, and I have all of these things in my in-town neighborhood, plus I can walk to the grocery store, multiple bus stops, several parks, great restaurants, and much more. I can also bike to many more places, including work. I can also sit on my porch and chat with my neighbors when they walk their dogs. The suburbs don’t have a lock on livability. On the contrary, after living in the suburbs, a college town, a city with millions of people, and a rural forest, I find my in-town neighborhood to be the best lifestyle possible. Car commutes are soul-destroying, and I don’t want to live someplace where I have to drive to get anywhere. It’s not healthy for my body, the environment, mental health, or a sense of community. And what happens when older folks are car dependent but can’t drive anymore? I’m starting to wonder about this as I watch my parents age. They’d be much better off in an urban area with amenities than in any car-dependent suburb. Indeed, I think my neighborhood accommodates every age: my kids and their friends get around easily on pubic transportation, for example, and don’t need me to drive them everywhere.
But also… all that suburban space you’re enjoying has been subsidized by freeway building, which destroyed many urban livable, walkable neighborhoods. And the suburbs were historically inaccessible to many families of color, who simply were never allowed to buy in (the GI Bill, for example, which set off a lot of white families moving to the suburbs and started the process of building wealth for an entire generation of white families, also perpetuated segregation and was designed not to provide those same benefits to black veterans).
I can afford my home because I have a good paying job and because I went to a public university at a time when my family could afford to pay for it, so I’m not wracked with student loans. Being Gen X means I’m not on the boomer gravy train, but I’m in much better shape than some of the young folks you’ve decried. And this is because of an incredible amount of government subsidization of my education. I think it’s very easy for older white folks not to recognize how the government has subsidized so much of what we have.
But, here’s the thing: I don’t want to stay in my large house when my kids are older and I don’t need all that space. I would love to be able to move into a four-plex and grow old in my walkable community. You know what else I want? More people to be able to afford to live in my neighborhood and enjoy all that we have. Increasing density is the only way to do that.
Younger doesn’t mean dumb. Younger folks want to live in town because they value shorter commutes and livability and community and diversity. Many grew up in the suburbs and know exactly what they are missing out on. Just because they have a different vision for their future doesn’t mean they are wrong.
This pretty much aligns with my life and opinions!! Well, I guess by age (35 and 3/4) I straddle the line between millennial and gen-x, but otherwise.
It is time for this pointless, limiting housing restriction to go. It probably should have never existed at all!
It won’t solve all our problems, and probably very few in any immediate sense. But I just can’t imagine a continually growing city not allowing this type of construction so darn close to its center.
I also think “boomer gravy train” would be a great name for a 70s cover band.
They are not wrong. But RIP is not going to give them what they want. It will benefit developers, not current and not even future residents.
The recent economic literature suggests that RIP will likely benefit single family home owners by significantly increasing land costs/housing prices. YIMBYs, of course, deny this because it undermines their absurd “affordability” claims. In my experience, believers in reactionary “trickle down” economics are near impervious to evidence to the contrary — the only choice is free markets. It’s a real shame because the pairing pro-density policy with tenant protections has repeatedly addressed “housing crises” in non-US cities.
If you’re going to link to a paywalled site hosting Yonah Freemark’s research you could at least also link to articles where he has put his own research in context, such as this: https://thefrisc.com/housing-arguments-over-sb-50-distort-my-upzoning-study-heres-how-to-get-zoning-changes-right-40daf85b74dc
Wake me up when YIMBYs start putting their knee jerk support for laissez faire financial deregulation “in context”.
That comment makes literally no sense.
I’m not against it, but I’m going to go out on a limb and predict that new 4-10 story apartment buildings will supply the majority of new housing units. ADUs or fourplexes will be small potatoes in comparison.
You believe a housing type that is essentially non-existent in Portland’s recent history of development will solve the housing crisis?
I’m stoked to live in an area that will be greatly affected by RIP and readily welcome a developer paying for my corner lot. Washington is beginning to sound better.
If that is how you feel, then under the new rules you will certainly have the freedom to relocate. But if you move out, and a triplex gets built on your lot, then that means that three other individuals of families who wish to live in a slightly more densely built environment will also have an opportunity to do so.
So, you apparently really dislike your neighbors? Because they are the ones left behind to deal with a new towering monstrosity next them and the negatives that come with these (almost always) taller buildings that steal light and privacy (and likely property value) from their neighbors.
I like the idea of increasing density, but tearing down existing buildings seems like a wasteful way to achieve it.
Tearing down inefficient old buildings may be the most efficient way to increase density (outside of building on vacant and some underused lots, like parking lots).
How else are you imagining density happening?
Seems to me the other option is building density out on the edge (seems like a contradiction, and wouldn’t be near walkable services and retail), requiring a huge amount of new infrastructure while boosting transportation costs and time.
How about “tearing down old buildings at the end of their useful life”? The problem with demolishing useful structures is that’s often where rents/prices are lowest (especially if two or more people split the rent/mortgage).
I agree that building a new triplex (with smaller units) will likely result in lower rents than building a new single family house, but a new triplex will never have lower rents than an existing house. That’s why “the money shot” photo in the article is misleading; it omits the “do nothing” option.
The “do nothing” option means those existing houses will still be torn down. They’ll just be replaced with one very large, very expensive house, as they are now. The RIP will make a positive change in that replacement single houses will be smaller (reducing the incentive for one-for-one teardowns) or they might be replaced by 2 or 3 homes in one structure.
I’d be far more open to RIP absent the incentives to demolish buildings that would not otherwise be demolished. I’d also welcome disincentives to demolish existing serviceable housing for replacement with new single family houses. It’s not about the resulting housing type so much as increasing demolitions.
Giving tenants first right of refusal (or perhaps a non-profit like REACH) when a building is sold to a developer might help keep existing affordable housing intact. Is that something you would support?
Yes, I support the first right of refusal (Tenant Opportunity to Purchase), as well as a city program to help get financing and logistical to lower-income folks to build ADUs
I think we really missed the boat on mall redevelopment during the height of the boom, as I think malls would be some of the best places for it. Build a bunch of midrise apartment and hotel towers where the surface lots and mostly empty anchor stores currently are, but leave the internal concourse and smaller shop spaces. The 1000-2000 residents would create an on-site customer base for all the smaller mall businesses, and yet they’d still be open to the public. That should have happened to the Lloyd Center years ago, but it could be done at Clackamas Town Center, Washington Square, Vancouver Mall, etc. You’d have onsite walkability, regardless of how far out in the burbs it is.
Mall205 would be great for this. I still wish the city would focus more efforts on making Gateway a 2nd “downtown” in Portland.
Yeah, Mall205 too. Per the development map at nextportland, a lot of the Gateway projects have had no action on them in the past year, but I think you have the right idea. The key to adding a sufficient number of units relative to population is permitting high-density mixed-use in all existing commercial corridors.
A handful of triplexes and ADUs is piddly. Labor is a serious bottleneck in terms of construction. Might as well devote it to big projects with hundreds of units.
Clackamas and Washington Square are poor examples as they are actually successful enterprises (by sales per square foot and full parking lots). Macerich owns Washington Square and it is one of their top performing assets nationwide.
Evan, tearing down an existing house, creating noise and toxic dust, putting the demolished house in the dump, and all of the impact for new materials and building a new house have impacts to our environment, transportation systems and the people around the building site. We need to balance those impacts with the benefits of increased density.
So glad i left Portland, it’s turned (and is turning) into a terrible place.