I have a right to afford your house!

According to the Philadelphia Inquirer, the Bryn Mawr Hospital (a local hospital that wants to expand) has been acquiring property by using the old-fashioned, pre-Kelo method of paying people whatever it takes to get them to sell! The most recent price paid by the hospital for what are run-down old rowhouses (I’ve seen them) was $300,000. The hospital intends to tear them down — a fact which does not please local activists, who accuse the hospital of destroying something they call “affordable housing”:

The loss of affordable housing in Bryn Mawr, resident Amanda Bergson-Shilcock said, costs “the opportunity to live in safe neighborhoods with good schools and tight community bonds.”
Hank Wilson, president of the Bryn Mawr Civic Association, said that “in one shot,” the community would lose 25 percent of its affordable housing in the planned demolition. However, Bob Duncan, director of township building and planning, put that figure at “roughly 10 percent,” about 50 of about 450 residences in the downtown area.
“The real story here,” said Bergson-Shilcock, who has stayed in her Summit Grove twin, is that “the teachers, police officers, firefighters and other sorts of community contributors can’t afford to live here anymore.”
In the meantime, those who have not left are in a bind. If they eventually sell, they’ll likely end up living in less desirable housing and paying higher mortgages and taxes.
“People want to stay where they are, debt-free, the mortgage paid off,” said Central Avenue holdout Nicholas Lyons, organist at St. Francis Xavier the Oratory Church in Philadelphia.
The hospital notes, and Zelov agrees, that those who left went willingly. “Most were quite pleased with the purchase price,” Wells said.
It was when the hospital doubled its 2001 offer of $125,000 for rowhouses and $145,000 for twins that “people began leaving in the middle of the night,” Giersch said, laughing. She said the hospital recently bought a rowhouse across the street for $300,000.
“Three hundred thousand doesn’t get much in Lower Merion,” said Giersch, who paid $36,000 in 1979 for her house. “Of the 13… owners who sold on Central Avenue, only two were able to relocate in Bryn Mawr.”

True, $300,000 doesn’t get much in Lower Merion — but a cheap rowhouse is certainly not “much” to begin with.
While I don’t know whether these people are being pressured to sell, I’m glad to see the hospital going about this the way it’s supposed to be done. Buy the place legitimately, for what it’s worth.
But that’s not my primary question. What I want to know is, what the hell is meant by “affordable housing”? If a house is placed on the market and it sells, or if an owner agrees to an offer to buy it, doesn’t that mean that the buyer could afford to buy it — and that therefore by definition it was affordable? If the word “affordable” means anything at all, then all housing for which buyers can be found is affordable. And, of course, houses that don’t sell because the price is too high would be unaffordable. Because it usually isn’t in a seller’s interest to not sell a house, this generally means that prices of unaffordable housing will be lowered until it becomes affordable.
Somehow, I don’t think this what the activists mean by the term. I suspect that what they mean is housing with a price low enough that certain people can afford it. The article specifically refers to “teachers, police officers, firefighters and other sorts of community contributors.” I’m not about to conduct detailed research as to the current salary levels for teachers in the Lower Merion School District, but according to this site, the average teacher salary in 1998 was $64,900, and I’d be willing to bet they’ve gone up since then. Can a Bryn Mawr schoolteacher afford one of the $300,000 rowhouses? Assuming a 30% of that salary goes towards a mortage payment, such a teacher, if unmarried, could afford to pay around 21,000 per year on a mortgage. With a 30 year loan of $300,000 at 5.75%, the monthly payment would be $1,751, which seems pretty close to me.
While it’s true that Bryn Mawr has become very expensive (according to the last census data, the average Bryn Mawr home cost $472,588), the fact is that $300,000 can buy a much better house somewhere else, within driving distance. (The average price in nearby Norristown was $157,403.) I seriously doubt that any of these sellers would be crazy enough to buy another Bryn Mawr rowhouse for $300,000, though, and I think attaching the “affordable housing” label to them is very misleading. Unless, of course, the goal is for the government to fix prices on real estate. But if it is, why don’t they say so?
Do teachers or police officers (or other “community contributors”) have any particular right to be able to “afford” houses in Bryn Mawr?
For that matter, does anyone? Do I have a right to live in Manhattan at a price I can afford?
According to the logic of the “affordable housing” people, I guess I do.
No wonder activists love undefinable communitarian phraseology.
The problem is, there’s no way to make something “affordable” to someone who can’t otherwise afford it unless someone else pays. What they’re not saying is exactly who’d end up having to pay — or who’d end up with the privilege of getting an “affordable” house.


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9 responses to “I have a right to afford your house!”

  1. Patrick Lasswell Avatar

    Based on my observations, the term “affordable housing in Bryn Mawr” is an oxymoron. Although there are a fair number of large houses on average lots, there are a bunch of large houses on freaking huge lots. That is the intention of the community, and if you don’t want to live there, don’t. If the community makes it too expensive to live there, find a new community and deprive the rich people of your services until they pay you enough to live nearby.

  2. Linda F Avatar

    First, I totally agree that receiving what amounts to a windfall is not unfair in the least. The owners have the right not to sell, and that’s the way it should be.
    I do question your figures for housing – the after-tax portion of that average salary is considerably less (mostly due to the hit Social Security takes on the smaller salaries). It must be remembered that the average salary of teachers and other city employees is misleading – the low end is what counts. If there is a requirement to live in city (very common for city employees), that’s the person that will be most affected by housing costs that are high. The answer, however, is not to make the more affordable areas of the city off-limits, it’s to let market forces go to work. When employees can’t live in the city, difficulty hiring translates into changes – housing subsidies, loosening restrictions on where employees can locate, accepting a smaller job applicant pool.

  3. Eric Scheie Avatar

    I’m not sure how to calculate the after tax share, as taxes take a large bite, but that share would decrease according to the mortgage tax deduction. (Even assuming a 300K house, the mortgage would be more like 260K.)
    Bryn Mawr doesn’t have city schools or police as it’s part of Lower Merion Township, and I don’t think there’s any residency requirement for teachers or police officers. The prices have skyrocketed, and this drives up the lower end houses at a faster rate than the upper end houses. In truth, all houses in Bryn Mawr — including the lower end ones — can now be called “unaffordable” if teacher salaries are the measuring stick. People who can afford $300,000 rowhouses would do better to look elsewhere, and I think it tortures the meaning of words to call them “affordable housing.”

  4. Dave W Avatar
    Dave W

    There are plenty of lower cost communities within 10 minutes of Bryn Mawr with traffic (Havertown, Broomall, etc). People have two reasons for what they do, a good one and the real one. The good one in this case is to argue about the lack of affordable housing. The Real one is to get the hospital to pony up more $$ for their property.

  5. Don Miller Avatar
    Don Miller

    When someone says there is a lack of affordable housing in a community, what they are really saying is that they can’t afford to live in the community.
    The nuances of the real estate market are really beyond most people. Some communities get a reputation that makes them more desirable to live in than others.
    Price is the only way we have to divide up scarce resources. In this case, the scarce resource is a “desirable” community.
    Yes it really stinks when you live in a town for 30 years and find out that it is now trendy and you can’t afford to live there anymore. But the affordable housing argument is a socialist argument that says anyone should be able to live anywhere they want to.
    It’s silly really, if anyone could live on Malibu beach, the rich would live somewhere else 😉

  6. Richard Wells Avatar
    Richard Wells

    Eric–this is the “Wells” quoted in the Inquirer article you cite. You make an interesting analysis. Do you live locally?
    Richard Wells

  7. Eric Scheie Avatar

    I don’t live in Bryn Mawr, but I’m pretty close. Near the Conshohocken exit off the Blue Route.

  8. Ben-David Avatar
    Ben-David

    I don’t see anyone asserting a “right” to affordable housing – from the perspective of local governance and communal values, it is valid to ask in general if the community’s service providers can actually live in the area, or how a major real estate development will impact local demographics.
    So?

  9. Eric Scheie Avatar

    I don’t think the ill-defined catch phrase is being bandied about for the purpose of asking general questions, and I think it is valid to raise inferences. I don’t like undefined phrases, and “affordable housing” has become a catch phrase for limiting property rights. People have as much right to ask what you call “general” questions as I do to speculate about why they’re raising them.
    In this context, the phraseology implies that Bryn Mawr hospital has a duty to preserve or supply “affordable housing” — simply because it has purchased a bunch of old houses it wishes to tear down. I think that is socialism — and wrong.
    So, while I wish I could share your view that these are simply general questions, my experience with socialists tells me otherwise.