Another Benefit of a Non-Profit Housing Acquisition Program: Tenant Mobility

In past blog posts I've written about many of the potential benefits of a non-profit, acquisition-based affordable housing program:

  • It's cheaper than building new housing; you get more units for your dollar.
  • It's permanent, unlike 30- or 55-year covenants on most new affordable housing.
  • It's financially sustainable and doesn't require constant replenishment with public funds.
  • It would be easier to distribute affordable housing throughout the city rather than concentrating it in a few development-friendly (or simply politically weak) areas.
  • It could serve as a safety net for residents displaced by new development.
  • It would protect older, "naturally affordable" housing from value-add investments that increase rents, and redirect more investment toward new development instead.

And so on. 

Well, here's another one that I overlooked. If enough housing is acquired by non-profits, it can help solve one of the most intractable problems of rent-stabilized and rent-controlled housing: lost mobility.

Right now, rent stabilization only works if you're willing to stay in the same unit forever. You may be getting a great deal, but if you have a child and need an extra room, get a new job across town, want to move closer to your parents or your kids, are looking to downsize (or upgrade), or are simply looking for a change of scenery, you're out of luck. As soon as you move out, your deal is over and you go back to paying market-rate rent wherever you end up. As a consequence of this, lots of people stay put even when everything except their rent says that moving is the best thing for them. (The same is true for Prop 13, for the record.)

At this very moment, there are probably a whole bunch of people living in Glendale (for example) who used to work in the area but now have jobs in (e.g.) West LA. Likewise, there are probably quite a few in the opposite situation, renting in West LA but now working in, say, Burbank. This is a horrible situation from the perspective of personal quality life and regional traffic, but these people are stuck. It'd be great to move nearer to their job, but they might end up paying an extra $500/month depending how long they'd been in their rental and how much rates have climbed over that time; better to deal with the commute, spend a little more time and money on driving, and pocket the rest of their savings. It's not often commented upon, but there are many thousands of households in circumstances like this, all but forced to stay in place no matter how inconvenient or untenable their circumstances become.

As an alternative, it would be great if the person in Glendale could just switch apartments with the person in West LA and keep the same rent, right? Straight up trade each other, and pick up the former tenants monthly rent. The landlords keep getting the same amount of money from each unit, and the commutes for both households improve substantially. Win-win! Well, too bad, because a for-profit apartment owner would never allow that. It's in their best interest for you to move out and open your unit up to a new tenant, free and clear, because then they can charge the market-rate rent. Win-lose. There's just absolutely zero incentive for a private landlord to allow a swap like this.

If, on the other hand, you had a non-profit (or multiple non-profits) that owned tens of thousands of apartments throughout the region—and had a mission oriented around keeping rents low and stable—they could be much more open to this proposition. Since they plan on keeping their rents low anyway, they might as well let tenants switch around. It doesn't harm the non-profit, it improves the lives of the tenants, and its good for the region as a whole since more people get to live, work and play in the same community instead of clogging up the freeways traveling between their various destinations each day. And since ownership of the units is consolidated, connecting linked pairs like the Glendale-West LA pair described above would be much easier, logistically speaking.

Or how about this: We have a lot of people in rent-stabilized units living near Metro rail stations and Rapid lines, who never use transit and never will. They have no use for all the new service in their area that's come around since they moved in, but they can't leave without paying much more in rent somewhere else. Wouldn't it be nice if that person could trade homes with someone who can't afford to live near a Metro line but depends on transit every day? If the lower-income person's unit isn't nice enough for the driver, hey, the non-profit has thousands of others to choose from—take your pick in as car-oriented a neighborhood as you like.

A program like this would probably need to be means-tested, limited to those who really needed the ongoing support of a low, stable rent. But over time, as a larger and larger share of housing was acquired by non-profits and was less impacted by the ups and downs of the housing market, and became less dependent on supporting its mission with market-rate rents, maybe that could change and everyone would be free to take part.

Just one more reason to get this program started.

Here's a picture of a random Glendale apartment building, so that when this article is shared there's an accompanying image. Enjoy!