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Editorial: Pockets of high housing values mask the need elsewhere

Here’s the edited version of a valuable new assessment of Buffalo’s housing market: It’s booming, except where it isn’t.

That’s a short way of saying that while the city’s resurgence is real, it doesn’t yet extend to many parts of the city. That creates challenges in developing a municipal policy on affordable housing. To help plot a way forward, the city hired a consulting firm, czbLLC of Alexandria, Va., to identify the forces influencing housing in different parts of the city.

At a cost of $90,000, the resulting analysis was a bargain, assuming the city makes good use of the findings. It was also a highly caffeinated jolt to anyone who thought the city’s ongoing revival was taking care of all the city’s problems. It’s not. The way forward is littered with complications that flow from the city’s high rate of poverty.

Buffalo’s housing market is booming in areas including the waterfront, part of South Buffalo and the neighborhoods around Elmwood, Delaware and Hertel avenues. Prices are averaging around $250,000, offering clear evidence of a healthy housing market.

You don’t have to drive far, though, to find areas where housing values hover around $30,000 and where incomes are so low that residents have trouble making even $500 payments, let alone investing in maintenance or improvements. That poverty is what complicates the city’s housing strategy.

Unlike cities such as Seattle or Boston, where high housing costs drive affordability problems, Buffalo and cities like it are hampered by low incomes that put even reasonable prices out of reach. That set of circumstances requires different approaches, but as the consultants observed, there is no one-size-fits-all solution in a city characterized by 50 tract-level neighborhoods that fit into five divergent housing categories.

Overall the consultants found that the city’s housing stock would need $608 million in improvements to make all properties marketable. It’s an intimidating problem, one that requires a variety of strategies to address over what is sure to be a long period.

Those approaches include more code enforcement, rental property inspections, targeted investment of federal funds and other money, micro mortgages, land trusts and a new tax exemption to encourage income and racial integration. All are worth pursuing.
What it doesn’t include is mandatory inclusionary zoning. Some advocates have been seeking to pressure the city into adopting such a policy, which would require developers to set aside a certain number of units in each property for low-income housing, making up for lost revenue by charging more for the remaining units.

The arithmetic may work on paper, but it falls apart in the real world. Market-rate tenants would move to the suburbs rather than pay those inflated rents. Developers know that, so they would also choose to build outside the city. Buffalo and its poor residents would be the losers. Mayor Byron W. Brown has made clear that he understands that problem and has no interest in adopting it.
The consultant’s report does, however, allow for a voluntary policy of inclusionary zoning. That is worth considering.

Because of the “fragility” of Buffalo’s housing market, any inclusionary zoning must be voluntary and must fully offset the developer’s reduced income, the report says. The city can accomplish that, on a case-by-case basis, through tools such as cash subsidies, tax breaks or – intriguingly – height or density variances that compensate for lost revenue by allowing departures from the city zoning law, known as the Green Code.

That approach is bound to be controversial, given the short time the code has been in force and the passion with which many of its supporters defend it. Still, it’s a low-cost way of achieving an undeniable social good and, given Buffalo’s high number of poor residents, one that is especially urgent.

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