Habitat for Humanity can’t afford to keep building single-family homes in Austin

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AUSTIN (KXAN) — Habitat for Humanity plans to dedicate six homes Saturday, the newest addition to the Scenic Point neighborhood in east Austin the nonprofit has been building for years.

The homes join 10 others in a planned 67-house development on land donated to Habitat for Humanity.

“This neighborhood is really dreams for 67 families being answered,” said Wayne Gerami, Habitat’s Vice President of Client Services.

Volunteers have been building entire neighborhoods like this in Austin for the last 20 years, but Scenic Point might be the last. Typically, Habitat buys the land to build houses, but surging prices in the last decade have made the prospect unsustainable.

Billy Whipple, VP of Construction, said 15 years ago, they built a home for $50,000. When you look at that home’s property values now, the land is “appraised at $140,000 just for the dirt.”

The nonprofit is now shifting its focus to denser housing options, including townhouses a 50-unit affordable housing complex announced earlier this year.

Austin Habitat for Humanity’s condo project near Plaza Saltillo (Habitat for Humanity Photo)

“It’s really what has to be done to capitalize on the opportunity,” said Whipple. “Land cost is the very direct reason why we’re going denser and building up.”

In 2018, the median income for a family of four was $86,000, according to the U.S. Department of Housing and Urban Development; this year it’s $95,900, an 11.5% increase in 12 months.

A family of four making less than $75,500 now qualifies as “low-income” in the city of Austin and is eligible for affordable housing.

“There’s a lot of families out there that could qualify for something like this but don’t know it,” Gerami said.

The group will build 51 more homes in the Scenic Point neighborhood over the next several years. Saturday’s dedication is not a move-in date for families, but rather an appreciation day for the volunteers and sponsors who made the community possible.

Challenges for all builders

Whipple said the nonprofit is able to build the condos near Plaza Saltillo under a new resolution Austin’s City Council passed this year.

“Affordability Unlocked,” proposed by Council Member Greg Casar, relaxed building regulations for dense, affordable housing developments.

If 50% of a development includes affordable housing units, some building standards can now be waived. Those standards can be related to height, setbacks from property lines and parking.

But Habitat said it still has a long way to go before they can get final permits to break ground. That’s a frustration all builders in Austin share.

“We have an exceedingly long process,” said Scott Turner, owner of Riverside Homes. “For a small project to take one or two years just going through permitting process before you can break ground, think of all people who need to find a home in that one or two year cycle and prices are going up the whole time.”

Turner said in Austin, because the Land Development Code limits what you can build in certain areas, “you take one house out and replace it with one house, that doesn’t do anything to the city’s housing supply.”

Land Development Code rewrite underway

The City of Austin is in the process of updating its Land Development Code.

Turner’s hoping to see it sooner rather than later “because everyone in Austin is missing out until we can get some more housing on the ground,” he said.

Mayor Steve Adler said, “I think it’s real important that we get this Land Development Code rewrite done. We’ve had community meetings about it for six years. We’ve talked about it.”

Earlier this year, the Austin City Council asked City Manager Spencer Cronk to work on a draft and have it be available for a first round of voting in October.

This week, Cronk told the city staff due to the scope of work, he’s proposing an early December vote.

“Quite frankly, I want the manager to take the time he needs in order to make sure we have a good product,” Adler said. “So while I wanted it to happen as quickly as we can, I don’t it to happen more quickly than it should.”

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