Is Nashville’s affordable housing plan the ‘Obamacare’ of housing?

Nashville’s Temple Church on Sunday was abuzz with talk on affordable housing.

Mayor Megan Barry joined several local and state leaders at the event put on by Nashville Organized for Action and Hope, or NOAH.

From NewsChannel5:

The purpose was to recap what has been done to bring more affordable housing to the community and to look ahead at future plans.

Some advocates praised Mayor Barry for committing $25 million to the issue, but said more units have been needed and there should be less of a focus on another hot topic — transportation.

A report on affordable housing from the mayor’s office stated Nashville’s shortage of affordable housing units has been estimated to reach 31,000 by 2025.

Housing advocates estimated it will take $775 million of leveraged funding to build 31,000 units — 15 percent of what the city has been asking for the $5.2 billion transit project.

But how to create affordable housing is a controversial topic, both in Nashville, and around the country.

Critics of heavy government intervention in affordable housing point to places like San Francisco, where a heavy government hand has done very little to aid an affordable housing shortage.

And The Beacon Center of Tennessee has examined Nashville’s affordable housing blueprint and officials there fear that the plan is the “Obamacare” of housing.

From The Beacon Center:

In September 2016, the city of Nashville passed a law that, with limited exceptions, requires homebuilders to set aside a portion of their development as “affordable” or “workforce” housing or instead pay a significant fee into a slush fund. As anyone who has been paying attention knows, a government program that begins with the term affordable is typically anything but. Need proof? Look no further than the Affordable Care Act, or Obamacare. That redistribution of wealth scheme has left working-class Americans with astronomically higher prices and fewer health insurance options, all in exchange for a worthless guarantee that it will be more “affordable.”

“Affordable” housing is essentially the Obamacare of housing. It makes it more expensive to build. This will result in developers building fewer homes, which will cause housing supply to dwindle. The extra costs will be passed on to buyers and renters, increasing their expenses. In both scenarios, it will cause prices to rise for those who can afford it the least: lower- and middle-income earners. If you think housing is expensive now, just wait until it’s “affordable.”

Not only will this mandate make housing less affordable, it will also create the same fiscal cliffs as many other welfare programs. If a person will have to pay more for their housing as their income increases, then they will be less likely to pursue moderate increases in pay or take on more work to move up in life. This scheme by Nashville’s government creates a disincentive for the poor to improve their lives.\

Read Beacon’s full report here.

 

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