| St. Louis Five Year Consolidated Plan Strategy | |
| Issue Analysis Essay - Housing | |
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HOUSING
The housing stock of the City of St. Louis is unequaled in the region, and distinctive on a national scale. Much of its inventory consists of stately 1904 World's Fair townhouses with rich oak, maple, and mahogany trim, inlaid floors, banisters and chandeliers aplenty. The largest grace private streets in the Central West End. Almost as impressive are blocks and blocks of two and three story buildings flanking the central portion of the City on the north and south. The Second Empire and Federal style residences in Lafayette Square and Soulard have earned them protection on the National Register of Historic Places. In areas both north and south of the central core are still more numerous charming bungalows, "shot gun" homes, newer (dating to the 1930's, 40's and 50's) two story townhomes, and even pockets of 1950's ranch style homes. Interspersed in these areas are pockets of new construction, some single story, some two and three story detached developments along with a substantial amount of single family row house style construction. Construction for these units dates from the mid 1980s. Although single family homes come first to mind when visualizing housing in St. Louis, multi-family rental units are almost as numerous. Like their single family counterparts, they are architecturally distinct, and come in a variety of styles and configurations. For many St. Louisans the two, three, four, and sometimes six family "flat" provides gracious and spacious living spaces. Other households can find garden apartments in newer complexes scattered throughout the City, some in whole new apartment communities, such as Murphy Park and Westminster Place. Of course, the housing stock of the City of St. Louis is also characterized by vacancy and vandalism on a massive scale. Deterioration of older buildings with nearly constant maintenance needs endanger the financial security of many homeowners, as well as owners of rental property, and threaten the structural integrity of the buildings themselves. The architectural merit, craftsmanship, and beauty of the remaining housing stock mean little if a significant portion of the City's households cannot afford them, or if renovation costs require rents that could not be obtained on the open market. Further, groups with specialized housing needs have found that the City's convenience to transit and its abundance of social service providers have made neighborhoods in the City of St. Louis a viable residential choice. These households usually require an array of services on the City's behalf to ensure that they are successfully integrated into the surrounding community and that their particular housing needs are addressed. The first section of this essay will examine the elements that constitute the current state of the City's housing environment. It will begin by looking at the social and demographic factors that shape demand for housing in the City of St. Louis. In so doing it will try to define what type of housing, particularly by bedroom size, will most suit the differing household types that reside in the City. This section will also examine changes since the last consolidated strategy in the number of vacant and substandard units, progress with respect to code enforcement, as well as the dilemma the city confronts with respect to the resident population's ability to afford housing in the City. The next section focuses on what most families in the region consider the mainstream supply of housing--that of single family homes. It looks at how the City of St. Louis has fared since the last Consolidated Plan Five Year Strategy, its strengths and weaknesses, and compares it to other markets within the region. The section will discuss a variety of indicators which describe these strengths and weaknesses, such as comparing the sale price to list price, average sales price, and days on market. The third section examines the renter housing component of the St. Louis housing market. A significant component of the rental housing market in the City are the units subsidized through the Section 8 program, the Low Income Housing Tax Credit program, the public housing complexes, and other rental assistance programs. It will also examine rental needs for both families as well as the elderly. In the fourth section, special housing needs for special populations are examined. These include assistance for persons or households infected with HIV or AIDS, housing needs for the disabled and mentally ill, and the homeless. The fifth and final section will explore areas of opportunities and promise. It will point to areas where the City of St. Louis would experience a good return on its investment of time and other resources in terms of bringing about a sense of equilibrium to the St. Louis housing market. ELEMENTS OF SUPPLY AND DEMAND
In the previous 1994 Consolidated Plan Five Year Strategy, census data concerning household size, composition, and income was combined with information about the current supply of dwelling units, vacancy, rent and mortgage levels. From this information, conclusions can be drawn about the type of housing, by bedroom size, that is needed to adequately house those households who currently live in the City of St. Louis. Some assumptions were also made about the level of substandard housing, took into account vacancies, and determined where the demand for certain types of housing exceeded supply and vice versa. The income data and the 1990 Census of Housing were used to draw some conclusions about the ability of households in St. Louis to afford the units available. Accordingly, the adjusted Census statistics for 1999 show that there were 138,471 households in the City of St. Louis; a household constituting one or more persons, usually related, but not always, occupying a dwelling unit. This represents a loss of 26,460 households since 1990, or a decline of 16 percent in the nine year period. As in 1990, 56 percent of these households were families, 39 percent were single person households, and 5 percent consisted of households with two or more unrelated persons (such as students occupying an apartment). Of those households who defined themselves as families, 56 percent were headed by married couples, the remaining 44 percent were headed by a single parent, usually female. Over half of all families had children under 18 years of age. In other words, the household profile adjusted for 1999 is as follows: 54,004 Single person households
43,425 Family households headed by married couples
34,119 Family households headed by a single parent
77,544 Total family households
6,923 Households with unrelated individuals
138,471 Total Households (54,004 + 77,544 + 6,923)
The above data on households were combined with additional Census information about the number of households by household size, using the categories of one person to seven or more persons. This data was then further calibrated to show demand for housing by bedroom size, for those households currently within the City of St. Louis, shown on the following table: [Table B2-1, 1999 Demand for Housing by Number of Bedrooms and by Household Size Household] As shown in this table, taking into account household size, demand for one and two bedroom units constitutes 75 percent of the total demand for housing, or 104,930 units. The demand for three bedroom units is about 21,500 units, or 16 percent of total demand. Demand for four and five plus bedroom units, based on family size, is 9,576 and 2,460 units respectively, or 7 percent and 2 percent. These demand estimates are provided in the context of minimum standards to avoid overcrowding, they do not take into account consumer preference or affordability. Hence, although there are a small but significant amount of households needing in excess of three bedrooms (9 percent total) the bulk of demand for housing is for one and two bedroom units. Obviously, there are many one, two, and three person households living in units with three or four bedrooms, simply because they prefer them and can afford them. The estimates calculated for demand by number of bedrooms and household size can then be compared with estimates of the actual supply of units by number of bedrooms. The estimate of unit supply is also adjusted to account for vacant units which, while standing, are not in their present position part of the housing inventory. The estimate of unit supply must also be adjusted to account for substandard units so that a realistic portrait of the adequacy of the City's housing supply when compared to the demand by indigenous households emerges. The next table shows the current supply of occupied, that is, not vacant, dwelling units by number of bedrooms. Because information is not available classifying the inventory of vacant buildings by number of bedrooms, it must be assumed that the number of vacant dwelling units can be distributed uniformly by bedroom size. The next table also breaks out the number of dwelling units by the number of standard, as opposed to substandard, units. A unit is defined as substandard if it has defects that threaten its structural integrity, lacks plumbing, or is overcrowded (more than one person per room). The City of St. Louis has no information on the number of substandard units in its housing inventory, and professional opinions vary about the overall level of substandard units. In the previous Consolidated Plan Five Year Strategy, an estimate of 30 percent was used as the level of substandard units, which was obtained from an older planning study. More recent opinions from those involved in routine building inspections put the figure substantially lower, at 10 percent, assuming that vacant buildings are excluded from the picture. Others involved with housing renovation continue to maintain that the 30 percent substandard figure is more realistic. They reason that even though substantial renovation and new construction have occurred, the core building stock has aged yet another twenty years. Homes that were only 20 - 25 years old at the time of the original estimate are now 40 to 45 years old and may require major attention. Table B2-2 shows, using Census data updated by CACI Marketing Systems, Inc., that there are 181,335 dwelling units within the City, but that only about 138,471 are occupied. It should be emphasized that the vacant units are not the same as vacant structures. For example, a vacant four family flat would be counted as four vacant units. Nevertheless, the number of vacant housing units is substantial, almost one-fourth of the total dwelling unit inventory. It should also be noted that these figures include hundreds of vacant units of public housing awaiting demolition or renovation. The number of standard occupied dwelling units was calculated using both the 90 percent and 70 percent standard estimates to arrive at a range of standard units. Hence, according to the table, the number of standard units ranges from 96,930 to 124,624, or a range of about 27,694 units. [Table B2-2, Estimated 1999 City of St. Louis Housing Supply] The third and final table in this section compares the number of standard units, at both the 70 and 90 percent levels to the demand calculated previously. At the 90 percent standard level, there is a shortage of about 13,800 standard units. The statistical deficiencies exist for one bedroom units and four bedroom units. However, it is more realistic to assume that for many households where a one bedroom unit would be adequate, they are able to afford larger accommodations. Further, although it appears that the number of five plus bedroom units are adequate given demand, it is likely that many of those units are occupied by smaller, more prosperous households and not affordable for the larger low income households, which will be discussed in a later section. [TABLE B2-3, BALANCE OF CURRENT SUPPLY AND DEMAND] At the 70 percent standard level, the deficiencies are pronounced in one, three, and four bedroom units, with a resulting shortage of about 41,541 standard units. The 1994 assessment concluded that there was a shortage of 27,963 standard units, falling somewhere in the middle of the 1999 estimated range. At that time there were fewer vacant units. Further, the 1999 vacancy estimates probably do not take into account the demolition of many public housing units that occurred this past summer. It is really impossible to quantify how much progress the City has made in addressing the problem of substandard housing because of a lack of comprehensive information about the structural condition of the City's housing stock. As a result, a conclusion cannot be made as to whether or not the level of substandard buildings is greater today than it was in 1994. Certainly substantial activity has occurred in the interest of stabilizing building conditions in the City of St. Louis, and that will be discussed in the following section. CODE ENFORCEMENT EFFORTS AND PERMIT ACTIVITY For at least the past twenty years, the City of St. Louis has recognized the value of a consistent code enforcement effort aimed at preserving the structural integrity of its building stock. In the mid 1980's, Operation Conserve combined systematic inspections with other efforts to coordinate planning and address other nuisance issues threatening neighborhood stability. At about the same time, the City enacted its first occupancy ordinances, which, in certain neighborhoods, require a building inspection and occupancy permit when a dwelling unit changes owners. Although uniform, specific, and aggregated data for inspections is difficult to obtain, information for the past two years show that a great deal of inspection and follow up compliance activity has occurred. According to the Building Inspection Section of the Department of Public Safety, about 16,000 building inspections are performed annually as part of the conservation district certificate of inspection program. According to the Building Division, there may be as many as three inspections involving a single occupancy permit. Using this as a guide, there were about 5,384 units that were brought into code compliance on an annual basis. It is impossible to determine how many of those were actually substandard and were then made standard as a result of the inspection. Another 14,000 inspections are carried out through the routine building inspection - code enforcement program and in response to complaints. A third effort of the inspection department is the enforcement of what is known as "Project 87/88." This allows for a condemnation for occupancy based upon the nuisance threat or potential to the neighborhood based upon suspected illicit activity occurring in a dwelling. Under this category, there were 642 condemnations for occupancy in 1998. Another 667 condemnations occurred in the previous year (1998) because of structural deficiencies. The Building Division is also responsible for securing (boarding up) and re-securing vacant buildings for vacant buildings owned by the Land Reutilization Authority and others. The volume on this activity approaches 4,000 structures annually. Recently the number of vacant buildings, demolitions, and condemnations were inventoried and broken out by the 79 neighborhood districts in the City. According to the survey, since 1994 there have been 10,515 buildings condemned, and 7,011 buildings demolished. They counted 6,078 residential buildings that were vacant. When examined by neighborhood, the number of vacant buildings ranged from one to 475. A relative distribution of vacant buildings is shown as follows: [TABLE B2-4, DISTRIBUTION OF VACANT BUILDINGS] As depicted, slightly less than one third of St. Louis neighborhoods experience ten or fewer vacant buildings in their midst. About a fourth of the 79 neighborhoods contain between ten and fifty vacant buildings. Another third contain between fifty and two hundred vacant structures. The remaining 26 percent of neighborhoods are substantially impacted by vacant buildings, with each containing from 100 to 475 such structures. The number of demolitions by neighborhood ranges from three to 446. A relative distribution of demolitions is presented in the following table. [TABLE B2-5, DISTRIBUTION OF DEMOLITIONS] In the case of demolitions, only six percent of neighborhoods in the City have not experienced the demolition of a residential structure in the last four to five years. Another third have undergone a loss of from 11 to 50 buildings. Over half of all St. Louis neighborhoods have lost from 50 to 200 buildings. Another 6 percent have lost from 200 to 446 structures. The third indicator of code enforcement efforts aimed at maintaining the integrity of the City's housing stock is condemnation. This occurs when structural conditions, or nuisance circumstances become a threat to public safety. The number per neighborhood ranged from zero to 656, with the frequency distribution displayed as follows: [TABLE B2-6, DISTRIBUTION OF CONDEMNATIONS] Almost 40 percent of St. Louis City neighborhoods have experienced 25 or less condemnations over the past four to five years. Another 13 percent have experienced between 26 and 100 condemnations. Nearly half of all neighborhoods have experienced more than 100 condemnations, upwards to over 600 condemned buildings. Combining the number of observed vacant buildings which require securing with the number of condemnations and demolitions yields a staggering amount of activity, over 23,000 interventions aimed at addressing the problem of deteriorating buildings and protecting the public health and welfare. Certainly building code enforcement efforts are an integral component of the City's overall housing strategy, and its importance will increase as buildings continue to age and resulting structural deficiencies will likewise continue to worsen. So far this subsection has focused on the City's efforts to protect health and safety as it relates to vacant buildings, condemnations, and demolitions. Fortunately, a substantial focus of code enforcement activity involves, through the permit process, work that is ongoing to improve the City's housing stock and even construct new housing. As part of the City's on-going research, information was obtained comparing residential building permits in 1994 to 1998. In 1994, there were a total of 1,888 residential improvement permits issued, covering a wide range of activities from minor repairs to new building construction. Of those 1,888 permits, 346 were for amounts exceeding $10,000, in other words, a substantial improvement or remodeling. In 1998, there were a total of 2,013 residential improvement permits, an increase of 6 percent over the period four years earlier. Even more significant is that the number of permits in excess of $10,000 was 526, an increase of 52% over the period four years earlier. AFFORDABILITY ASPECTS AND THE EFFECT ON HOUSING SUPPLY AND DEMAND The inability of many households in the City of St. Louis to afford adequate housing has a direct bearing on the quality of the City's housing stock. Low income homeowners, especially those in pre-1940 housing, may have difficulty not only financing the monthly payments for the home but also carrying out routine maintenance as well as more costly repairs. Often the loss of a job for one wage earner in a household means that important repairs are postponed, ultimately endangering the structural integrity of the home. Given the data available, primarily 1990 household and family income, and uncorrelated data on household size, it is not possible to determine with precision the exact number of households for whom affordable housing is an issue. However, the tables on the following page give a rough idea of rental and owner cost burdens based on the Census data adjusted to 1999 estimated households. [Table B2-7, (Same as IIIb-2) St. Louis Rental Housing Burdens - est. 1999] [Table B2-8, (Same as IIIb-1) St. Louis Homeowner Burdens - est. 1999] OWNER OCCUPIED HOUSING Most importantly, however, suppressed household income levels put much of the single family housing stock in the City of St. Louis out of reach. For purposes of illustration, the median housing value in the City for 1998 was $60,507, according to CACI estimates based on the U.S. Census. Assuming a family could make a 5 percent down payment (less would be required if FHA or VA financed), they would need a mortgage for $57,482. At 8 percent interest for 30 years, the principle and interest payment would be $421.78. Adding another $100.00 for escrow of taxes and insurance (not including mortgage insurance which would also surely be required), the monthly payment becomes at least $521.78. For a house with no down payment, financing the whole median amount of $60,507 results in a monthly house payment of $544.00, including taxes and insurance. HUD guidelines say that housing is affordable if its cost is 30 percent or less of a family's adjusted gross income. A house payment of $521.78 is affordable for a household earning $1,739.00 per month or about $20,871 per year. With the house payment of $544.00 per month, the monthly income would need to be $1,813.00 or $21,760 per year. Again, this does not include routine maintenance and repair (which would not be encountered in a rental situation) or utility costs. Of the 138,471 households in the City of St. Louis, just over a third, or 33.9 percent, have incomes below $20,000 annually. According to the latest Census updates provided by CACI, Inc., about 58 percent of all occupied units consist of owner occupied dwellings. Further, CACI projects that the amount of owner occupied housing as a percentage of all housing will increase by the year 2003. RENTER HOUSING Where the rental housing market contains a large percentage of low income renters, landlords cannot find households for certain locations who can afford the rents at a level that allow for a good return on investment and consistent upkeep of the property. Also, the type and distribution of rental properties in the City, i.e., frequently dispersed in aging two, three, and four family flats, may not allow for economies of scale that help keep rents at affordable levels. Another factor working against finding adequate levels of affordable rental properties is the fairly tight market throughout the region for rental apartments. In the City alone, vacancy levels have declined to 6 percent in 1998 from 9 percent in 1997 in the higher end apartment complexes. For these same higher end market rate properties in 1998, the average monthly rent for a one bedroom unit was $460, $669 for a two bedroom unit, and $1,176 for a three bedroom unit, reflecting a four percent increase since 1997. (Source: Abt Associates report to the St. Louis Housing Authority, based on Kramer Associates apartment survey.) In an effort to determine prevailing market rate rent levels, the City of St. Louis made numerous checks of publications that advertise properties for rent. These include a variety of Internet rental referral sites, the St. Louis Post Dispatch, the St. Louis Argus, the St. Louis American, the Riverfront Times, West End Word, and others. Properties for rent were aggregated according to the four zones used by the regional Multi-listing Service of the St. Louis Board of Realtors and are summarized as follows: [TABLE B2-9, 1999 APARTMENT RENTAL SURVEY] According to this survey, the average city-wide rent for an unfurnished apartment, using the sampling process stated above, was $524.00. These rates do not take into account number of bedrooms, but it could be inferred that these rent levels were for 1.5 to 2.0 bedrooms. It is unknown how many, if any, of these properties included utilities in the rents sampled. Assuming no utilities were included, the average rent in the City of $524 would require a monthly income of $1,747, or $20,960 in order to be affordable. Again, a little more than a third of St. Louis households earn less than this amount annually. The following monthly rent levels are the Fair Market Rents put forward by the Department of Housing and Urban Development for 1999: Efficiency/Studio $317 1 bedroom $386 2 bedroom $501 3 bedroom $652 4 bedroom $721 It would appear from the results of the rent sample survey that the observed rents are in line with the established HUD fair market rents. It should be recognized, however, that the data give no indications about the level of substandard units in existence among those surveyed, and the extent to which those surveyed truly represent the City's rental housing inventory. Although it is difficult to determine, given the lack of comprehensive data, the precise number of households who struggle with housing affordability, some general conclusions can be drawn about this issue. Given that one third of households earn less than $20,000 annually, they fall below the 80% Adjusted Gross Median Income level established by HUD of $26,950 annually for a single person household. Also, the St. Louis Public Housing Authority has reopened their waiting lists for public housing units and Section 8 after having closed them for several months. At last report, there were 955 family applicants for public housing, and over two thirds of those, or 630 families, needed units with two or three bedrooms. Another 14 percent, or 134 families, needed larger units with four or more bedrooms. SINGLE FAMILY FOR-SALE MARKET RATE HOUSING - TRENDS AND COMPARISONS When most people think of housing in the region, they think of the single family home on a tree lined street, or, if in suburbia, a tree lined cul-de-sac. Most people's impressions of a locality are generally based on how they perceive the quality of housing and the neighborhood in which it is located. As alluded to previously, the St. Louis housing stock is characterized by a diversity of housing styles, built mostly from 1870 onward, with most built before 1940. It contains housing of all sizes and configurations, with the major common characteristic being that it is brick. Although City homes are architecturally distinctive and City neighborhoods are gracious, another view of City housing is provided with an examination of the region's on-going single family for sale activity, afforded by the St. Louis Board of Realtors Metropolitan Listing Service (MLS). The MLS provides comparable information on sales by municipality and for the region (west of the Mississippi) as a whole. It measures home sales according to the original asking sales price (list price), the actual price the home sold for (sales price), the ratio of sales price to list price, and how many days the property sat on the market, (DOM). For-sale housing in the region is aggregated by school district, and the City of St. Louis is divided into the four sub-districts mentioned previously: Southwest, East of Grand, North, and Central West. The table below summarizes data for properties that have been sold in the area covered by the MLS region for the first six months of 1999 by price interval. [TABLE B2-10, SUMMARY OF SINGLE FAMILY SALES ACTIVITY] As shown in the table, there were 10,183 single family homes sold that were included on the MLS. Of those, 10.3 percent were sold for under $50,000. The largest portion of sales, or 34.3 percent, occurred in the $50,000 - $99,999 bracket. Another 31.3 percent of sales were found in the $100,000 - $159,999 category. Finally, about a fourth, or 24.1 percent were sold at prices $160,000 and over. Looking at the sale price:list price percentage, the level, 98, is observed in the $120,000 to $159,999 price range. The lower ratios are found at the lower end of the sale price continuum, under $50,000. The average Days on Market indicator was highest at the uppermost and lowest ends of the spectrum. The shortest days on market can be found in the $70,000 to $90,000 price intervals. Another view of the single family market can be obtained by looking at the homes currently on the market in the City of St. Louis four sub areas. The chart below breaks out homes that are for sale in these areas by asking price interval. As of August, 1999, there were about 743 properties on the market. Of these, 86 percent are listed for under $100,000. Only 108 properties, or 14 percent, are listed at over $100,000. Almost two thirds of the listings are in the Grand-East and Southwest quadrants. The West Central area has only 99 listings, or 13 percent of the total. What needs to be emphasized is the relative scarcity of properties on the market for over $100,000 and especially in the $150,000 to $200,000 bracket At the present there are only 23 choices for a potential home buyer, in the entire City of St. Louis, if they are looking for a property in that price range. [TABLE B2-11, SINGLE FAMILY FOR-SALE LISTINGS BY AREA AND PRICE RANGE] The following two tables provide information on closed sales over the past two years and provide another view of the City's niche in the regional real estate market. The first breaks out closed sale data by the four sub areas. As shown, there were 5,085 sales in the city of St. Louis for the two year period ending August 15, 1999. The overwhelming majority, 54 percent, were in the southwest district. The north sub area had about 10 percent of the closed sales. In terms of sale price distribution, 84 percent of the closed sales were under $100,000, or, 16 percent of sales were over $100,000. Only 6 percent of the sales were over $150,000. On the other hand, the percent of homes sold over $100,000 in the area covered by the regional MLS for year to date 1999 is 55.4 percent. (These regional MLS figures include the City of St. Louis sales as well.) It is also worth noting the large volume of sales in the southwest quadrant of the City, about 46 percent of sales. [TABLE B2-12, SINGLE FAMILY CLOSED SALES IN PREVIOUS TWO YEARS] The following table shows similar data for 13 selected school districts in St. Louis and St. Charles counties and compared them to the summary data for St. Louis City. In addition to the percentage of sales in various pricing intervals, it is also useful to look at the sheer volume, or lack of volume among the various areas and the City of St. Louis. For example, there were only 160 sales in the City in the $150,000 - $199,999 price range. The figure is substantially fewer than in each of the older and smaller suburbs of University City, Webster Groves, and Kirkwood. In the developing suburbs of the region, homes in the $150,000 to $199,999 range constitute the majority of sales activity. In Francis Howell and Ft. Zumwalt South, the percentage of homes in this interval are 53 percent and 55 percent respectively, compared to the City of St. Louis's figure of 3 percent. All of these tables point to the same shortcomings in the City of St. Louis single family marketplace. Families in the region purchase homes in all price ranges, but those significant households who want a home in the $150,000 and over price range generally find housing elsewhere. For the selected school districts surveyed, (not by any means all of the areas covered by the St. Louis regional MLS), 5,177 homes in excess of $150,000 were sold over the past two years. Of those, only 367, or 7 percent, were in the City of St. Louis. If the City WERE compared to ALL home sales in the MLS that percentage of homes in the $150,000 to $199,999 range probably would be even lower. There is ample evidence that the City of St. Louis is not a full participant in the regional single family home marketplace, given the lack of sales at certain price levels. That in and of itself would not be a major sign of dysfunction as long as sale prices and other indicators, such as days on market trend in the same direction as the rest of the region. The data shown on the next table suggest, however, that that is not the case. The previous Consolidated Plan Five Year Strategy provided data comparing the City of St. Louis market indicators to the rest of the region. Specifically they tracked the average sales price, the average list price, the sale price to list price ratio, and days on market through year to date in 1994. Table B2-10 uses the same information and continues for five years through the year to date 1999. It also compares the City average sale prices, list prices, sale price/list price ratios and days on market to the region's to determine whether or not the City's indicators have kept pace. Probably the most important comparison made on this chart is that of the City's average sale price in a given year to the region's. For example, in 1990, the average price of a home sold in the City of St. Louis was $66,300, compared to the average price in the region as a whole of $100,900. The City's average price in that year was 66 percent of the region's average price. In 1995 the average home price in the City was $66,200, compared to the average for the region of $115,000. Thus the City's sale price was 58 percent of the region's. [TABLE B2-14, COMPARISON OF CITY MLS DATA WITH METRO AREA WEST 1990 - PRESENT] If the City's sale prices were tracking in the same direction as the region, the percentage would be about the same year after year. That would at least indicate some stability even though the City's average prices were lower. However, over the last nine plus years, the City's average sale prices as a percentage of the region's have declined steadily and substantially, from 66 percent in 1990 to 52 percent in for the year to date 1999, or to 55 percent for 1998. Indicators comparing the sale price:list price ratios show that while the City's homes are discounted to a slightly greater degree than the region, they have been tracking at about the same percent, 97 or 98 percent. In terms of days on market, with the exception of the year-to-date 1999, City homes generally have a somewhat longer period on the market, reflecting lower demand for those properties. The final column in this table showed the City's DOM as a percent of the region's. A percentage score over 100 reflects longer days on market for the City. Since 1990, that score increased steadily to 1996. It has declined since then and, for the year to date, the City and region average days on market are the same. Should 1999 end on the same note, that would be a positive indicator for the success of marketing City properties. The most important measure of progress, however, will continue to be the City sales prices as a percent of the region's. AREAS OF STRENGTH AND OPPORTUNITY There are numerous reasons why St. Louis is not viewed by most as a realistic location for choosing a single family home. Schools are cited frequently, along with perceptions of crime and neighborhood decline. Population trends have simply moved the "center of gravity" of the region westward toward Lindbergh and I-270, with as many jobs located along I-270 nodes as are located in downtown St. Louis. New employment opportunities are being developed even further west, into St. Charles, St. Peters, and O'Fallon, Missouri. For households with children and a full range of daily activities, the many cultural and recreational attractions in the City are simply not relevant in their daily lives and are reached easily enough when there is time to take in a particular attraction. Within the City, however, are large percentages of inhabitants who are committed to staying in their neighborhoods and making them better. Specific areas have experienced substantial success which can be measured in terms of the MLS indicators. Rehabilitated homes in Soulard, portions of Shaw, and other areas benefit from short days on market and relatively minor list price reductions. In St. Louis Hills, sale price levels are relatively high considering the amount of square feet and lack of multiple baths. The attractiveness of the neighborhood is reflected by the short days on market in that quadrant compared to the rest of the City. Another area of promise is the condominium market, especially in the Central West End, Skinker DeBaliviere, and the Wydown-Skinker area. According to the MLS, the City of St. Louis constitutes a major portion of the condominium market in the region. For the year to date period of 1999, the average condominium sale price in the region was $103,000. In the west-central sub area of the City, where most of the condominiums are located, the average sale price is above the regional average at $126,200. Further, average days on market is 74 days in the west central area compared to 82 in the region. Within recent weeks, discussions have occurred with real estate agents active in selling properties in all of the City's neighborhoods. They were united in their optimism about the prospects for reviving demand for City housing. Most appeared well acquainted with incentives available to households wanting to buy a house in the City. They also stated that most of their customers were not first time residents but were either moving up, downsizing, or becoming homeowners after renting elsewhere in the City limits. The agents were enthusiastic about the $2,000 program which can be applied toward closing costs and not income restricted. Their major concern was the total lack of materials available for them to market City neighborhoods and a concurrent lack of knowledge on the part of other agents about housing, neighborhoods, and pleasures of City living. A related issue on the part of the salespersons present, representing all areas of the City, was the need for St. Louis to invest in market rate housing. These professionals believed that all City neighborhoods would benefit from the infusion of a greater number of middle income homeowners, and that demand is sufficient. HOUSING PRODUCTION AND CONSERVATION - FOR SALE HOUSING The City of St. Louis has undertaken a number of programs and initiatives aimed at boosting the production of for sale housing. In this section the types of assistance offered and the end results, in terms of new or rehabilitated homes throughout St. Louis neighborhoods, will be reviewed. The Housing Production efforts of the City of St. Louis have focused on two major functions, assisting new homebuyers and retaining current residents/homeowners through the home repair program. HOME BUYER ASSISTANCE The following five programs have been instrumental in helping households locate and purchase housing in the City. The number of units impacted by each is also provided for the period 1994 through year to date 1999. [TABLE B2-15, MAJOR HOMEBUYER ASSISTANCE PROGRAMS 1994 - 1999] As shown, a total of 937 units have been impacted with these six programs, which, from 1996 on, have produced about 235 units annually. Together they provide technical assistance or financial aid in the form of downpayments and closing costs to prospective buyers in designated neighborhoods. In addition, other groups have been involved in providing help to homebuyers. These include the Urban League of Metropolitan St. Louis and the HOPE III program, with funding for the latter ending in 1998. As the titles of most of these programs and sponsors would suggest, these homeowner assistance programs are aimed at allowing low to moderate income households the opportunity to find affordable housing. In 1998 the Community Development Agency again reestablished the $2000 First Time Homebuyer Program. As with several other programs, it underwrites closing costs and points, but is not initially income restricted or area restricted. These forgivable loans went to 127 households in 1998, with the amount to be expanded considerably by year's end in 1999. This program was highly praised by real estate salespersons who specialize in marketing City properties. HOME REPAIR Numerous programs are available to assist low income households with the major responsibility of maintaining older City homes and preserving or improving the stability of entire neighborhoods. The following table summarizes the accomplishments of the major initiatives for home repair for the period 1994 through YTD 1999. [TABLE B2-16, MAJOR HOME REPAIR PROGRAMS: 1994 - 1999] Since 1994, nearly 2800 homes have received repairs at varying levels of intensity through the seven programs detailed above. The number of repairs increased steadily from 1994 through 1997, then fell off somewhat in 1998. Repairs for 1999 should exceed the previous year if progress continues at the current rate. The Targeted Assistance Program is responsible for the bulk of repairs, about 44 percent. Similar to the other programs, it provides grants to income eligible homeowners for home repairs in targeted areas of the City. The Senior Home Security program also assists with minor repairs for elderly or disabled homeowners. RENTER HOUSING Although the National Low Income Housing Coalition in 1998 identified the St. Louis area as the most affordable place in the United States for low income tenants to rent a two bedroom apartment, the City remains committed to a maximum effort to ensuring that households at the lowest income thresholds find standard housing. In addition to this, there is an understanding on the part of the City that rental housing is often a port of entry for households at all income levels. Renting a loft, a flat, or an apartment in a new or rehabilitated unit is a way to become familiar with City life without making a long term commitment. Of course, a satisfactory rental experience is one of the best ways to encourage a more permanent home ownership commitment. This section examines how the City conserves or produces rental housing at all income levels. At one end of the spectrum is the St. Louis Public Housing Authority with its inventory of public housing complexes and Section 8 program of vouchers and certificates. The Missouri Housing Development Commission also helps with financing a number of affordable housing rental programs and the Low Income Housing Tax Credit. The State of Missouri is becoming increasingly involved in helping owners of older or historic homes with a credit on State income taxes for the cost of rehabilitation and repairs. The City of St. Louis, through developers and community based organizations also support development of rental housing and management of rental properties. PUBLIC HOUSING The last five years have witnessed substantial changes for public housing. Much progress is evident with several major developments:
Assuming these three initiatives are completed as planned, SLHA's total public housing stock will be reduced to about 4500 units. The remaining housing stock is old and in fair to poor condition. Elderly projects in particular are plagued with high vacancies due to competition by more desirable Section 202 Elderly properties, the overall loss of elderly residents in the City in the last five years, and the presence of young disabled tenants, most of whom have mental disabilities, in the elderly public housing complexes. As a result of these high vacancies and management difficulties, the SLHA is undergoing a Section 202 Assessment of nine developments with over 2700 units. They retained a specialized consulting firm to carry out a detailed analysis of the prospects of increasing occupancy at these developments and the likelihood that repairs could be carried out in such a way as to be more cost effective than vouchers. The three largest troubled properties are Cochran Gardens, Blumeyer, and Clinton Peabody. The consulting team has recommended a demolition and improvement program that would cost about $150 Million and could be carried out over a ten year period. Further, the SLHA has changed its priorities for housing potential tenants which would re-orient the tenant mix, resulting in a greater percentage of households with some wage earning potential. Numerous issues and dilemmas confront tenants and policy makers alike in the new millennium. Substantial funds have been expended on modernization during the past decade. Modernization plans must take into account the extent to which improvements in the standard of living for the overall population filter to those who have no choice but to live in public housing. At the time many of the public housing developments were built, they were similar in terms of size and amenity to many apartments and homes that were constructed on the open market. There are many small two and three bedroom homes built during the 1950's, especially in near north St. Louis County with less than 1,000 square feet, no disposals, dishwashers, or central air conditioning, minimal cabinets, one bathroom, carport or a one car garage and very small yards. These constituted starter homes for the World Ward II veterans who were thrilled to have them and could afford them on one income. Starter homes today have closer to 1,500 to 1,800 square feet, central air, dishwashers, disposals, possibly built in microwaves, a two car garage, and two baths. Similarly, public housing that was once viewed as somewhat less desirable than an apartment on the open market is now several levels below what starter households would find acceptable as a place to live and raise a family. The lack of garbage disposals, dishwashers, and spacious rooms complicate housekeeping functions, especially in a single parent household. In several elderly units shower curtains constitute closet doors. It should not come as a surprise when elderly households find other alternatives. Public housing modernization programs will need to take into account the enhanced quality of life requirements of households at all income levels and budget and manage accordingly. Aside from issues of strategic allocation of scarce resources are the requirements that management assert a strong presence to maintain the improvements for the benefit of all tenants. St. Louis is far from alone in facing difficulties in securing strong management of their public housing properties. A September 20, 1999 article in the Chicago Tribune profiled a two year old, two story row house public housing development which replaced the high rise towers known as Henry Horner Homes. Of the thirty-six row houses which line a single block on West Maypole Street, nine homes are now boarded up. The new low rise buildings appear to represent state-of-the-art design which would appeal to households at all income levels, with attractive brick facades, stone accents, and turrets indistinguishable from other market rate multi-family housing. The complex was supposed to mix low income families with working class low and moderate income families. The income mix has not occurred and the units have become threatened with gang activity. Now the Chicago Housing Authority is considering a management contract with an outside firm which would provide a package of services, including parenting training, job skills, and housekeeping assessments, along with the traditional duties of tenant screening and property maintenance. Unless the deterioration is stopped, the whole redevelopment plan in that part of the City, including market rate units, is threatened. From these experiences it should be apparent that public housing success does not come without a major and comprehensive commitment to management and the whole range of activities now considered essential to be effective. Certainly public housing officials and planning and development officials have much to benefit from increased interaction and cooperation. New public housing developments need to be located in viable neighborhoods with access to transit and commercial activities. They need to be planned in concert with overall neighborhood planning activities. As the public housing delivery system increasingly moves to household based subsidies, (discussed in the following section) management support will need to be redesigned accordingly, perhaps in coordination with community based organizations. Further, more attention should focus on the need for the region as a whole to shoulder a greater share of the burden in providing housing for low income families. OTHER LOW INCOME/MIXED INCOME HOUSING In addition to units supplied through public housing apartment complexes, low income households can also take advantage of affordable rental units sponsored through a variety of other programs. Probably the largest is the Section 8 program vouchers and certificates. With Section 8, a household is required to pay only a third of their net income for rent, and the Federal Government pays the balance, based upon what they determine is a fair market rent for the unit selected. The trend in recent years has been to decentralize the concentration of low income populations, moving to household based certificates (and vouchers) as opposed to project based Section 8 sponsorship. The Section 8 program has several categories, including new construction, rehabilitation, substantial rehabilitation, low-moderate income, and elderly. Another major federal programs is the Section 202 Elderly program, which has resulted in such developments as the Macler Shepperd Apartments in the Jeff Vander Lou area. Other federal housing programs with a presence in the City of St. Louis include the Section d(4), Section 223, 232, and 236. These units have been responsible for the construction or renovation of nearly 15,000 units since the mid 1970's. The Low Income Housing Tax Credit has also had a major role in supplying affordable rental housing to St. Louis households. The number of units authorized by year is as follows: Year # of Units 1994 184 1995 560 1996 239 1997 101 1998 338 Totals 1,422 Many of these units also require infusion of other public funds, such as CDBG, in order to make the projects feasible. The above list shows that the volume of activity peaked in 1995 with 560 units authorized LOCATION OF OWNER AND RENTER HOUSING FUNDED THROUGH CDBG, 1994 - 1998 It is the Housing Section of the Community Development Administration that is responsible for the production of housing funded through the Community Development Block Grant, using the myriad of homeowner and renter programs described previously. Involved in the process are a host of potential homeowners and renters, City planners, inspectors, administrators, sometimes not for profit foundations, for-profit developers as well as neighborhood or community based organizations. It requires all of their sustained efforts to produce housing that complies with public safety codes and design standards, is successful in the marketplace, meets the needs of the household who has chosen to occupy it, and ultimately strengthens the neighborhood and the City as a whole. This massive combination of effort has resulted in the production or rehabilitation of about 2,860 units of housing from 1994 through 1998. Funding from the Community Development Administration has approached $76 million during this period. These funds have leveraged the investment of an additional $173.2 million from a variety of public and private sources, for a total investment of nearly $249 million for the five year period. The location of this housing production and number of units per neighborhood is shown on the chart on the following page. The number of units per neighborhood ranged from one to 474, in the Carr Square district, supporting the Murphy Park mixed income development. Of the 2861 units produced, 2124, or 74 percent were rental, and 737, or 26 percent were for sale. In some areas funds were also spent on demolition which provided indirect support for housing renovation and new construction. The 2861 units had an average per unit cost of $26,484 in Community Development funds, and an average per unit total cost of $87,012. Actual costs varied widely however. The CDA infusion ranged from about $5,000 per unit to $110,000, but over half of the developments received between $20,000 and $50,000 per unit. The total development costs ranged from about $10,000 per unit to $164,600 per unit. Over half of the total project costs were between $75,000 and $115,000 per unit. CURRENT MAJOR PROJECT INITIATIVES As previously described, housing production does not come without the involvement of a host of individuals, agencies, and institutions. Housing redevelopment in the City of St. Louis, as in all central cities, requires all these entities, and then some. Since the 1986 IRS tax revisions, new ways of financing and structuring projects have been put into place, requiring great quantities of creativity and sophistication. Both are apparent in the City of St. Louis' current agenda of major housing initiatives. The most relevant features of these developments are summarized as follows.
3959 Washington in Central West End -- 38 one bedroom rental units of new construction for low income elderly individuals. Financed with Federal and State Tax Credits, MHDC and CDA funding. Developed by Greater Bethlehem Housing Corporation. Total Development Cost is $3.3 Million, including $675,000 CDA funding. South Grand Sears Site in Dutchtown -- 30 units of new for sale housing on a very symbolic location, sponsored by South Grand Team. Financed with CDBG assistance, involves capital improvements. Developed by Pyramid Construction. Total Development Cost is $6.7 Million, including $1.5 Million CDA funding. Booth Manor at 3133 Iowa Avenue in Benton Park West -- 74 units rental housing for low income seniors. Financed with CDBG for capital improvements and HUD 202 grant. Developed by Salvation Army. Total Development Cost is $5.1 Million including $84,000 CDA funding. 3226 Park in Gate District -- 38 new rental units for senior housing . Uses 202 Elderly and small amount of CDBG funding. Developed by St. Andrews Episcopal-Presbyterian Foundation. Total Development Cost is $2.7 Million, including $6,000 CDA financing. Sporting News Lofts in Downtown West -- 84 rehabilitated loft rental units in mixed income development. CDA participation involves "pre-development" analysis. Developed by Loft Partners, LLC. 20th and Cass in Carr Square Neighborhood -- Demolition, clean up and capital improvements in support of the new, 132 unit George L. Vaughn Residences in Murphy Park. Developer: Urban Strategies. CDA proposes to provide total $1 Million cost. Another seven projects are in the works involving another 350 units of housing. These include the Gate District, Bohemian Hill, Garden District, Academy, Jeff Vander Lou, and Walnut Park. SPECIALIZED HOUSING NEEDS At the center of the bi-state region, the City of St. Louis is fortunate to be home to top flight medical schools, a variety of social welfare agencies, foundations, and charities, strong caring communities, a convenient grid street system and access to transit. All of these elements act as facilitators and support for population groups who must rely on help from these various entities to carry out their activities of daily living. These groups include the homeless, those with mental illness, physical disabilities, and HIV/AIDS. Over the past ten years increased knowledge about these conditions and characteristics along with committed leadership among those within these groups or connected to them in some way has led to the implementation of programs that can increase their quality of life and even lead to recovery. PERSONS WITH DISABILITIES Through the Community Information Network, information is publicized about the goals to ensure "self determination, independence, empowerment, integration, and inclusion of children and adults with disabilities in all aspects of our plan." The issue with respect to housing is that households which contain persons with disabilities have as many choices as possible in selecting a place to live. This has become increasingly possible as laws and ordinances enacted following the Americans With Disabilities Act are enforced. Now a portion of homes in new developments, or apartments, must have the option to be customized for persons with physical impairments. Persons with disabilities which prevent them from holding jobs can qualify for disability support under the Social Security Administration. As such they can also qualify for housing which is oriented to the disabled and/or elderly. In addition to public housing for the disabled, there are several apartment complexes which provide housing specialized for disabled households. Some of these units are developed under the Section 811 Program of the Department of Housing and Urban Development. However, it is the goal of most of those associated with advocacy groups for the disabled that housing that meets their needs be part of the mainstream housing market, dispersed throughout the community. After all, most of us will experience disability at some point, typically during the latter part of our lives. It would be in all of our interests if housing were designed to accommodate a temporary or permanent disability, and minimize the disruption caused by the need to locate suitable living arrangements. This issue will only grow in importance as the baby boom generation matures beyond age 65, where disabilities will affect a significant percent of the population. Unfortunately there is not a good system in place to inventory and monitor disabled households. Many of them have suitable housing, work full time jobs, and have avoided contact with any group that would categorize them as disabled as such. Most numbers are assumptions based on nine year old Census data which put the percentage of the disabled population at 11 percent. That would establish a level of disabled persons at 36,764, given the City's 16 percent population decline. It is also important to note that a substantial percentage of the disabled population are elderly, and that the elderly population has declined at a percent greater than the overall population decline. So, it is possible that the number of disabled persons is somewhat less than 36,000. Of those that are classified as disabled, a portion can be classified as physically disabled and another as mentally disabled, although it is frequently difficult to separate them into mutually exclusive groups. In the under age 65 disabled households that occupy City elderly public housing, about 80 percent are classified as having mental disabilities, although this percent is probably higher than the general disabled population. Mental disabilities can be further classified into persons with mental illness as opposed to substance abuse and addictions. In terms of numbers, a 1995 survey found that 956 units in 42 housing developments operated by the St. Louis Housing Authority were occupied by persons with disabilities. Currently, of the nearly 1,000 persons on the waiting list for public housing, 205 have identified themselves as having disabilities. For these households, appropriate housing follows health care as their most important need. Almost as important however, is on-going follow up with social services, therapy, medication, and other support. Without this assistance, individuals can end up back on the streets and part of the homeless population. They can also adversely affect other households nearby, as has occurred in the elderly public housing in the City. Currently managers of these properties devote a substantial amount of their time ensuring that residents are receiving medication and resolving conflicts with the resident elderly population. Those individuals who can work are frequently confronted with losing their Medicaid benefits after a certain period of time, 39 months, if they earn more than $700.00 per month. There are proposals which would extend this period to 6 years. As with so many of these specialized needs, a whole package of services, housing, and intervention is required to achieve desirable results. Further, efforts need to be made to quantify those disabled individuals in need of medical care, housing, therapy or other support so that progress can be measured and determined. PERSONS WITH HIV/AIDS Perhaps the most significant development in the treatment of persons with HIV/AIDS has been the success of protease inhibitors and combination drug therapies to treat the symptoms of the disease. For many the results have been restored health and energy and an ability to earn a living and engage in "normal" activities. There has been a secondary, and perhaps not as desirable impact of these therapies, particularly in low income communities. The restored health (even if temporary) of those fortunate enough to receive the treatments creates the perception that HIV/AIDS is less of a threat than originally believed. Some experts in the field say that many young persons believe it is better to go ahead and become infected and simply treat the disease as a chronic condition. Hence, efforts at prevention have lagged in recent years. There has been an increase in infections among youth and young adults in the 15 - 25 age group. 65 percent of new infections are in the minority population. Another effect has been that the infected individuals are now able to survive for a number of years with the disease, but still require a number of services and frequently must cope with other disorders, such as mental illness and drug addictions. Further, there is a danger that others could be infected. The pool of persons in need of this help has thus greatly enlarged, and will need assistance for a longer period of time. Re-employment is often a difficult issue with this population group as the loss of Medicaid benefits is a disincentive to taking on full time work. At some point, many believe, the virus will again become resistant to the protease inhibitors and people with HIV/AIDS will again become sick. There are several housing/social service centers for persons with HIV/AIDS, including the Doorways I and II, the Peter and Paul Center, Bethany Place and the Mama Nyumba Townhouses for single parents. Through these programs 576 clients were served at a cost of $710,000. For the future, the strategy should be to simply do more of everything, with a focus on prevention. As with other special populations, good numbers are needed. HOMELESSNESS According to the 1998 Annual Report on Homelessness developed by the Catholic Charities Housing Resource Center, about 51,300 household members received services via the Emergency Shelter Hotline, resulting from calls from some 3,383 families in the City of St. Louis. The relationship of these two measures, household members and families suggest that many families who are homeless are not small and that they require multiple "units" or episodes of assistance. In addition to families, it is estimated that 3,000 veterans in the St. Louis area are homeless and that an additional 5 - 6,000 veterans are at risk of becoming homeless. Complicating efforts to help is the problem that a significant portion of the population also has been diagnosed with mental illness and/or substance abuse. Further, it is estimated that there are between 1500 and 2000 adolescents and young adults in need of shelter on any given night. Violence at homeless shelters has become a growing problem, and, since a portion of the homeless also have HIV/AIDS, there is a risk that others could be infected. The City of St. Louis, through its Homeless Services Division, provides funding for a variety of services. Working with the Housing Resource Center and the BJC ACCESS Project, as well as several other organizations, almost 8,000 persons were served in 1998. These persons received a total of 133,500 "units" of service. CONCLUSION AND RECOMMENDATIONS Through a massive commitment of effort, resources, and expertise, the City of St. Louis can take pride in the 2800 units of housing it has helped to build or restore through one or more of its housing programs since 1994 and the countless others it has impacted with capital improvements or neighborhood stabilization programs. The City should recognize, however, that while there have been many success stories, they have not had a positive impact on any of the measures of its for-sale single family housing market. It is imperative that those responsible for planning, especially those planning the development of housing, and the City's ultimate policy makers, realize how the City's housing market relates to the rest of the region and to make a number of decisions:
What is needed is nothing more or nothing less than a total commitment to bringing the issues of housing and neighborhood stability into focus by those making the decisions about allocation of scarce resources, including City general revenue if Federal funds cannot be spent in certain areas or for certain activities. The new planning capabilities being developed in the City at the present time have a full agenda of issues and activities. Nevertheless, it is most important for planners to illustrate for decision makers the impact of their various commitments and the trade-offs involved in making spending allocations Only by taking aim at carefully defined targets, and measuring progress, can housing, particularly for-sale housing, in the City of St. Louis avoid slipping into total irrelevance for most families and households in the regional marketplace. As outlined in this essay, there are many areas of promise and progress in all segments of the St. Louis housing market. Abundant effort and commitment of huge financial resources has produced progress in neighborhoods; house by house, block by block. Households and families searching for rental housing, affordable housing, condominiums; or households buying their first house or last house - all have benefited directly or indirectly from the hard work put forth to date. The City of St. Louis has made hard choices before in allocating scare resources. It has marshaled diverse interests and institutions in bringing about lasting improvements such as the Kiel Center and America's Center. The same level of effort and leadership is needed to reinforce the work completed in the past and to ensure progress in the future. |