Affordable Housing In LA Keeps Rents Low—but It Comes With An Expiration Date

August 14, 2019

For the last three decades, Hillside Villa, a pale green, stucco-coated building on Hill Place has been, for several hundred residents of Chinatown, a consistently affordable place to live.

Constructed in 1988, the complex was built with funds from LA’s once-powerful community redevelopment agency. Its 124 apartments were set aside for lower-earning residents.

But that was 30 years ago.

In December, the building’s affordability restrictions expired, meaning the building’s longtime owner, developer Thomas Botz, will soon be free to charge market rate rents for units previously reserved for tenants with qualifying incomes.

To qualify, residents needed to make, at most, 120 percent of LA’s median income. Thirty-six of the 124 units were reserved for those earning less, under 50 percent of the median income (in 2018, that was $48,450 for a family of four).

Nancy Ramirez, who’s lived in the building for 27 years, tells Curbed that in June the price of her unit, which she lives in with her son and mother, will jump from $1,265 to $2,000 per month.

Mark Guzman shares a three-bedroom apartment with his wife and her parents. He says the family was notified last year that the price of the unit would nearly triple, from $850 to $2,450 per month.

“I’m not going to be able to pay that rent,” he says. “My mother-in-law is still working as much as she can, but she can’t change jobs as easily as I can.”

Reached by phone, Botz tells Curbed that he’d like to keep some of the building’s units available for low-income residents, but that rent increases are necessary to pay for the building’s upkeep.

“The bottom line is, when you’re renting to people below market, the building doesn’t generate enough income to support itself,” he says.

The crisis residents of the Chinatown building now face is not unique to Hillside Villa.

Tenants protested the rent hikes in March, rallying in the streets of Chinatown.

Across Los Angeles County, more than 5,000 affordable apartments were converted to market-rate units between 1997 and 2018, according to a report from the California Housing Partnership.

Concluding that “state and local action is needed urgently,” the report’s authors found that an additional 12,121 affordable units are now at risk. That’s an even higher number than the 10,000 units the city of Los Angeles aims to build over the next decade through Measure HHH.

Many of the units now at risk were built around the same time as those at Hillside Villas, when affordability restrictions on low-income housing lasted 30 years or less.

Today, most of these developments are built with 55-year affordability covenants, but the Housing Partnership finds that many built before the 1990s are eligible for market rate conversion (or soon will be).

California Housing Partnership’s preservation and data manager, Danielle Mazzella, tells Curbed that it’s important for local officials to proactively identify buildings where affordability requirements will soon expire. Finding ways to extend those agreements can bolster a city’s supply of affordable housing—simply because preserving existing units is generally cheaper than building new ones.

Last month, Hillside Villa residents rallied in Chinatown, chanting “we will not be displaced,” and calling on Botz to abandon the forthcoming rent hikes.

For some tenants, the battle is about more than money. Keeping the building affordable means preserving the community that’s developed there since tenants began moving into the units in 1988, says Rene AlexZander, who leads a tenants association formed to fight the rent increases.

“This building is not a building where you just have tenants moving in and out,” he says. “We have multiple generations of people living in this building. A lot of my personal friends, who’ve become family over the past 17 years, are going to be displaced in some way. Where are our seniors going to go? Where are our low-income residents going to go?”

Jay Cortez, a spokesperson for City Councilmember Gil Cedillo, tells Curbed that the council office is working with Los Angeles’s housing department to negotiate “a positive solution” for residents of Hillside Villa. He did not provide more details on what that might look like.

Botz says he’s “hopeful” about those negotiations, but that “it does not look promising.” In the long run, he says some units could remain affordable through rental assistance programs aimed at homeless residents and veterans.

But for many longtime renters in the building, Botz maintains it might be time to accept offers of relocation assistance and move on.

“We’re trying to do what we can to help people deal with reality,” he says.

In the meantime, tenants say they’ll keep fighting.

“At this point, I’m really hoping this works,” says Guzman.



Source: https://la.curbed.com/2019/4/1/18283960/affordable-housing-los-angeles-expires-chinatown