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Win-Win Solutions

Posted on Sep 01, 2016 in Urban Design , Mark Schnell , September-October 2016

In my columns for The Seaside Times, I try to present viable, common sense solutions to difficult planning and urban design issues. But some issues are more difficult than others. And then there are the issues so complicated that people tend to skip right over the discussion. I’m talking, in this case, about affordable housing.

The trouble begins with defining affordable housing. The U.S. Department of Housing and Urban Development (HUD) definition of affordable housing: “In general, housing for which the occupant(s) is/are paying no more than 30 percent of his or her income for gross housing costs, including utilities.” So the concept of affordability varies greatly from place to place, and depends on average incomes and housing prices or rents. One can have a fairly high income in a place like San Francisco or New York and still have difficulty finding affording housing because the costs are so steep.

You want affordable housing? It’s actually fairly easy. Just find a place where very few people want to live, or where the economy is depressed. Find a small town where the major employer, such as a textile mill, closed down and the local economy severely declined or stagnated. Or try a big city like Detroit that’s struggling in multiple ways. Overall, it’s not a good situation. But, on the bright side, the housing is affordable!

Let’s talk about South Walton, a place where the economy is functioning, if not booming. That’s where it gets complicated. Affordable housing isn’t impossible to find, but it’s a challenge in a highly desirable area like South Walton.

Affordability in real estate has always been something of a paradox. As an urban designer, I spend my workdays trying to create great towns, neighborhoods, buildings, and parks. If I succeed and create a place that people love, then prices will naturally rise thanks to demand, and only those with deep enough pockets will buy or rent there.

This phenomenon isn’t limited to a certain neighborhood. Affordability hinges on proximity, too. It’s a major driver of real estate value, either down or up. If your property is next to a stinky paper mill, you might not see much value appreciation. But if your property is within a short distance of the Gulf of Mexico or highly desirable communities like Seaside or Rosemary Beach, the chances are good that even a dumpy old beach house will escalate in value. At some point, someone will just demolish that old house and build a new, much larger house in its place. You might enjoy that dynamic when you receive a check, but there’s no guarantee you can afford to buy another house in that neighborhood.

Zoning plays a major role, too. Most zoning ordinances are built, in part, around restricting density, which in turn impacts affordability. In many cases, those restrictions are intended to establish and maintain the low density pattern familiar in suburbs across America: single-family detached houses on large lots, with only one residential unit allowed per lot. A significant portion of South Walton is zoned in this way. And minimum parking requirements drive up costs, too, by using valuable land for cars rather than people.

(By the way, I’ve heard some people say that Walton County does not have zoning. It’s true that the county uses “land use categories” instead of “zones,” but that’s really just semantics. The map is divided up into categories/zones that each have specific rules about what a person can and cannot do on a parcel of land. That, in essence, is zoning.)

Two notable challenges arise from this kind of zoning: 1. For houses and lots with desirable locations (i.e. most of South Walton), this restriction of supply through zoning eventually pushes demand and prices up so high that affordable housing is basically impossible, and 2. Owners of such houses and lots have a vested interest in keeping out anything seen as “undesirable,” including higher densities and affordable housing (whether justified or not). This is how “NIMBYs” (Not In My Backyard) are born. They fight anything they perceive as a threat to their property values.

Well-intentioned people have, for many years, put forth ideas and proposals to fix the affordable housing problem, but with varying degrees of success. Our local Land Development Code allows for a density bonus if a developer provides some affordable housing. However, the code simultaneously drives prices up by maintaining huge areas of detached single-family houses on large lots. Some people want to kill zoning altogether to increase supply, but that would likely be a disaster in several ways. Most proposals involve a government mandate of some kind, including “inclusionary zoning,” which requires a certain percentage of units to be affordable in any given development. This works best in large cities with year-round residents and large inventories of multi-family housing.

In some of America’s extremely expensive cities, a few brave souls have started speaking up in favor of more density and other ways to bring down housing costs. They are sometimes called “YIMBYs” (Yes In My Backyard). I’m hearing more people in South Walton talk about affordability issues as prices have escalated to levels above the real estate boom of the mid-2000s. It’s hard to imagine the problem getting much better without a major market correction (which nobody wants).

In an effort to make a dent in the affordable housing quandary, I offer a modest proposal: Walton County should allow Accessory Dwelling Units (ADUs) with a few minor restrictions.

An ADU is a small secondary unit on the same lot as a typical detached single-family house. Examples include a small apartment over a garage or a guesthouse in a back yard. They are allowed in Walton County, but only if they are occupied by family of the house’s owner. There are other restrictions, too, such as a maximum area of 800 square feet, which are typical of such ordinances.

I suggest that Walton County eliminate the clause limiting use of the ADU to family occupancy. That’s a very difficult rule to enforce, and it’s ultimately hurting our ability to provide affordable housing. (Some communities like Seaside, Watercolor and Rosemary Beach can have ADUs without family occupancy thanks to their PUD — i.e. the zoning specific to that community.) And South Walton might need a requirement for owner-occupancy of the main house.

ADUs primarily serve smaller households such as singles, childless or empty nester couples, and single parents with one child. This is a significant portion of the U.S. population. For some context, here’s one of my favorite statistics: the classic “Leave It To Beaver” household of two married adults with children (who also live in the house) makes up only 22 percent of U.S. households. That means there are a great number of other types of households, many of whom need something smaller than a four- or five-bedroom

McMansion. Strangely, that’s not what’s being built, and it’s in short supply in places like South Walton.

You might be asking, “Wouldn’t this increase density?” Yes, but not significantly, and it’s not necessarily a bad thing. “And wouldn’t this increase traffic?” Slightly, but it’s ultimately better for people to live near work, school, etc. rather than clogging all roads on their commute from far away. “And what about letting those people into my neighborhood?” The people who inhabit these units are far from scary. They are your server at a restaurant, the firefighter, the manager of a store, and so on. And sometimes a life change — such as divorce, for example — sends a person in search of a smaller place to live. And your son or daughter just out of college, or your elderly parents, might need a smaller, more affordable place to live, too.

I believe this is one helpful step towards affordable housing because it’s a classic “win-win” scenario. The homeowner benefits from receiving a rent check every month from the tenant, and the tenant gets to live in a place they can afford and one that’s located closer to the places they need to go. Cities large and small like Portland, Ore., and Durango, Colo., have adopted ordinances allowing and even encouraging ADUs in recent years. In a complicated situation, this is one small reform that makes sense.

Mark Schnell is an urban designer based in Seagrove Beach. Among his most prominent projects are three New Urban beach communities on the Texas coast: Cinnamon Shore, Palmilla Beach, and Sunflower Beach. Learn more about his firm Schnell Urban Design at