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Housing InterpreteR CURRENT TRENDS IN REAL ESTATE AND THE RICHMOND REGION A PUBLICATION OF THE RICHMOND ASSOCIATION OF REALTORS®
JUNE 2015
CHALLENGE ACCEPTED—
Building a Stronger Richmond Region by Addressing Local Housing Issues IN THIS ISSUE: • PHA ADDRESSES THE REGION’S AFFORDABLE HOUSING CHALLENGE • EARTHCRAFT VIRGINIA—GREEN AND GROWING • FIVE “HIDDEN GEMS” OF RICHMOND • TRANSFORM RVA: BETTER HOUSING COALITION CELEBRATES 25 YEARS OF COMMUNITY TRANSFORMATION
WeAreTheR.com
PHA ADDRESSES THE REGION’S AFFORDABLE HOUSING CHALLENGE
by Devon Bremer, Special Correspondent
According to a recent report published by
the non-profit Partnership for Housing Affordability, the greater Richmond region—defined as the jurisdictions of Ashland, Charles City, Chesterfield, Goochland, Hanover, Henrico, New Kent, Powhatan and Richmond—lacks a sufficient supply of affordable housing, both rental and owner occupied. The challenge is regional, shared by all jurisdictions. Currently, 35% of all households in the region are cost burdened, meaning these households spend more than 30% of their gross monthly income on housing costs. At least 25% of residents living in each and every jurisdiction of the region—urban, suburban, or rural--are cost burdened. This issue may seem to go unnoticed in some areas, but the truth is, every jurisdiction is suffering from this problem; therefore all areas must build on each other’s strengths to better the region as a whole. Why should you care? Annually, each cost burdened household in the region averages an affordability deficit of $6,422. That totals to a staggering $862 million each year. That’s $862 million that is not saved for retirement or a child’s college education; that’s $862 million that is unavailable for discretionary spending—dining out, the new car, clothes, etc. And in large measure, it’s discretionary spending that creates jobs and keeps our regional economy humming. This lack of affordable housing diminishes our quality of life, impedes our economic competitiveness, and threatens our sustainability. Why does this gap exist? A local survey of about 170 housing industry practitioners and stakeholders
revealed that 67.9% believed that the affordability gap was because of the current economy/income levels. Simply put: while housing costs have continued to escalate, household income has remained stagnant or fallen. One respondent noted another issue: “the jobs-transportation-housing balance.” For example, Employer X, located in the costly Community A, offers thousands of jobs. Almost all of Employer X’s employees, however, can only afford to live in the less expensive Community B. Some employees remain in Community B without transportation to work (transportation is centered around Community A, which is partially why it is more costly). Some employees move to Community A to be closer to work and have transportation, but are now living somewhere that they cannot afford. The effects trickle down deeper than you may think. According to the report, the lack of affordable housing can have severe long-term economic consequences, slowing population growth and family formation and worsening school enrollment rates and business environments. On the flip side, affordable housing has proven to elicit “greater cognitive development in children” and acts as the foundation for family well-being. Plus, recent studies have debunked myths about affordable housing increasing crime and decreasing property values. We have the resources, so why wait? Education, collaboration, and creativity can overcome this challenge. Working alongside a Virginia Tech team, the VCU Center for Urban and Regional Analysis interviewed twelve housing experts to identify possible strategies to increase the supply of affordable housing
According to the report, the lack of affordable housing can have severe long-term economic consequences, slowing population growth and family formation and worsening school enrollment rates and business environments. On the flip side, affordable housing has proven to elicit “greater cognitive development in children” and acts as the foundation for family well-being. options. Using suggestions from the housing experts, the CURA team developed a survey to poll more than 170 individuals from government officials to philanthropic organizations. Respondents were asked to rank the potential effectiveness of the following strategies: • Site affordable housing near job centers and transit (67.9%); • Improve the regional transportation system (67.9%); • Increase job training resources (56.8%); • Dedicate a local funding source for affordable housing (54.9%); and • Improve housing focus within local government, and improve coordination between government and private housing providers (54.9%). The survey respondents expressed a strong commitment to cooperate and “develop realistic, effective strategies” to improve housing affordability. The approach to solutions can take many forms. The greater Richmond region includes urban, suburban, and exurban (rural) communities. The strategies developed to eliminate the housing deficit will vary from locality to locality-every jurisdiction has different affordability challenges and possibly different political concerns. But each community must take the challenge seriously and address it with determination. How do we know that this is doable? While it won’t be easy, closing the affordability gap is far from impossible. There are a plethora of examples showcasing a united community rising together and reestablishing the quality of life it deserves, from our immediate area to regions across the country. Recently, Richmond, Chesterfield and Henrico each provided $250,000 in funding towards a 21-room addition to Virginia Supportive Housing’s South Richmond complex, further aiding the fight to end homelessness. Further north, Rockville, Maryland was faced with a failing strip mall tainting the community; so they adopted a plan to create a new, pulsing town center with 175,000 square feet of shops and restaurants and 644 residential units, with a portion of those dedicated as affordable. (Continued on page 3) For more information, visit affordablehousingrichmond.com
Looking all the way to the West Coast, specifically the City of Portland, Oregon, communities are still finding creative ways to amp up their environment. Portland created a coalition of stakeholders consisting of local nonprofits, city agencies and lenders, and even the United States Department of Housing and Urban Development to preserve 11 buildings that provided affordable housing in desirable locations. Across the country, regardless of the challenge presented, the size of the community, or the location, there are excellent examples of successful responses to the affordable housing challenge. What can we do? The study provides a number of specific strategies that could be implemented in the region: Develop a flexible, dedicated funding source for affordable housing. • Improve the regional transit system and its funding, expansion, and accessibility. • Create incentives or requirements to site affordable housing near job centers and transit, and vice versa - address the “jobs-transportation-housing balance.” • Prioritize preservation of existing federally-assisted housing units. • Develop a community land trust to support long term affordable housing. In addition, the report outlines the steps the Partnership for Housing Affordability should take to monitor the region’s progress: Educate, and frequently reeducate, the entire community on the magnitude of the lack of affordable housing. • Inform the community of similar communities’ efforts in similar situations that have proven successful. • Track the region’s progress in addressing the issue, making the records open to the public as a source of motivation. • Celebrate all genuine efforts and successes. Make good use of positive reinforcement, which has proven to potentially be one of the strongest tools in these situations. This report provides hard evidence of our region’s affordable housing challenge. But it demonstrates as well that we have many of the necessary resources to reduce this deficit--substantially. Education, creativity and collaboration will play huge roles in our efforts. The health of all communities in the region relies on their citizens’ commitment to a solution, together. We are not the first to face this problem—communities throughout the nation have been tasked with tougher challenges, and have surpassed their goals and grown from the experience. By using what we know, and building off of the successful efforts we’ve seen, we can conquer this challenge too. ■
First-Time Homebuyers: Save Money with a Mortgage Credit Certificate from VHDA
If you’re buying your first home, a Mortgage Credit Certificate (MCC) from VHDA could save you thousands of dollars by reducing the amount of federal income tax you owe. Unlike an income tax deduction, an MCC is a dollar-for-dollar credit against your federal income tax liability: • The credit is equal to 20 percent of the annual mortgage interest you pay. • The remaining 80 percent may still be taken as a tax deduction. • The MCC is effective for the life of your mortgage, as long as you live in the home. To be eligible for an MCC, homebuyers must: • Be a first-time homebuyer, or not owned a home as a primary residence within the past three years. (This requirement may be waived if purchasing a home in a federal targeted area; to see a map of these areas, visit vhda.com/FederalTargetedAreas.) • Use the home as their principal residence. • Have income at or below the maximum household income limits (see chart below). • Purchase a home below the maximum sales price (Maximum loan amount for conventional loans is $417,000.) For details about loan limits, visit vhda.com/IncomeSalesPriceLoanLimits.
Click the image above to watch a brief video on how the MCC works.
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If you have a message for Richmond REALTORS速, homebuyers, or homeowners, please contact kwhitlow@rarealtors.com
GREEN AND GROWING EarthCraft Virginia
Across the nation, demand for high performance housing is increasing. The national Residential Energy Services Network (RESNET), in which EarthCraft Virginia serves as a certified provider, reported that 146,860 homes were rated by a Home Energy Rater and issued a Home Energy Rating (HERS) Index Score – that represents 33.9% or 1/3 of all new homes sold in 2014 (U.S. Census, 2014). Why the increase? A 2014 report from the National Association of REALTORS® showed that a significant portion of home buyers value green and energy efficient home features, finding that 9% of buyers cite these features as the reason for their newly-built home purchase (see National Association of REALTORS® infographic). Consumer awareness has reached a tipping point where potential homebuyers see the value of high performance housing to health, comfort and savings (both of energy and money) and choose it over other common appeals. A Harris Interactive Poll of 2,145 Americans recently found that 49% considered “eco-friendly” features more important than luxury items in a home (31%), and that buyers are paying 10 - 14% more for houses showing “green” certifications than for comparable houses without. And studies also show that green homeowners are happy. A survey of 187 green homeowners, commissioned in 2013 by the National Association of Home Builders, reveals that the majority of owners are happy with their initial decision to buy or build a green home; with 94% stating they would recommend a green home to a friend and 92% stating they would purchase another green home. These national trends are further supported by the Department of Energy’s newly launched Better Buildings Initiative strategy aimed to increase information to buyers by partnering with the Appraisal Institute and the Council of Multiple Listing Services. With heightened awareness and support, a searchable online HERS Index Score home registry, increasing available information and resources, consumers across the country are feeling more empowered to do the research, ask the right questions, and demand quality and verification in their new home.
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Here in Richmond, interest and awareness also seems to be on the rise. EarthCraft Virginia’s “Selling the EarthCraft House” training offered by the Richmond Association of REALTORS® earlier this year had an outstanding turnout of 50 agents—and upon request by a local garden club, almost 50 women came together to tour high performance, EarthCraft homes that were designed and built to consume near net zero energy. Over the next few issues of The Housing Interpreter, EarthCraft Virginia will continue this discussion around high performance home building with features on green and energy efficient appraisals, energy ratings, certification programs and energy efficient mortgages. How EarthCraft Can Help? The EarthCraft House program, offered statewide in Virginia and throughout the Southeast, offers builders third party verification and compliance with both HERS Index Score and EarthCraft certification. Comprehensive verification and testing ensures that all EarthCraft homes are top quality and a cut above the norm. By incorporating energy and resource efficient designs and systems, all EarthCraft homes demonstrate lowered energy costs, directly translating to monthly utility savings for the homeowners while lessening the home’s impact on the environment. With energy efficiency at its core, the EarthCraft program includes a confirmed Home Energy Rating Index Score on every certified home; EarthCraft Virginia’s average HERS is 65 and can even get down to single digits on some homes. This means that EarthCraft certified homes are often 35%+ more energy efficient than a standard new home on the market today. Coupling the HERS Index Score with high quality, sustainable construction, EarthCraft builders are bringing the next generation of housing to Virginia homeowners. You can expect more from your home with EarthCraft. You’ll notice the difference with these benefits: • Significant savings on operating and maintenance costs • Conservation of energy, water and natural resources • A healthier living environment with improved air quality • A quieter home with increased comfort and enhanced durability ■
Five “Hidden Gems” of Richmond Arts, Architecture, and Oddities Worth a Closer Look
by Devon Bremer, Special Correspondent
1. Branch House The Branch House--home of the Virginia
Center for Architecture --sits on a stately corner at 2501 Monument Avenue. Built 1916-19 (keep an eye out for a hundred-year celebration) for a mere $160,000, the 27,000 sq. ft. home boasts an astounding 63 rooms. The home was designed by the renowned architect John Russell Pope for Richmond financier John Kerr Branch and his family to house their extensive collection of Italian Renaissance antiques. Pope was the designer for many famed structures; Richmond’s Union Station (now the Science Museum of Virginia) is another of his most well-known works. The building was opened to the public in 2005, and is the only such architectural museum in the Southeast and also the only home on Monument Avenue listed on the National Register of Historic Places. The building is open daily, but it’s recommended that you take a planned tour to get the full experience. To plan a tour, visit architectureva.org/programs.
2. Swift Creek Mill Erected in 1663, Swift Creek Mill,
located in South Chesterfield, is one of the oldest gristmills in the United States. The property changed hands multiple times in 200 years, but began operating under the name Swift Creek Mill in 1929, and remained in operation until 1956. Then three families who dreamed of bringing live professional theatre to the area purchased the site. Forty years later, the “Mill” serves as both a historic landmark, as well as a beautiful setting for approximately 175 shows per year. The “Mill” is a non-profit organization that has shepherded multiple individuals onto film, television and Broadway careers. Swift Creek Mill has also provided educational programs for children since 1989, hosting about a hundred children-oriented productions a year. Continuing to offer high quality theatre at a reasonable rate and serve as a showcase for local talent, the Swift Creek Mill is a wonderful establishment that rests in a beautiful, historic setting and provides entertainment for all ages. Visit swiftcreekmill.com to learn more.
3. Richmond Mural Project 10 Muralists. 2 Weeks. 20+ Murals throughout the
City of Richmond. The Art Whino gallery of National Harbor, Maryland, returned to Richmond for the third installment of their Richmond Mural Project last year, bringing the number of their murals to more than 68 across the city. They’ve repeated this formula for three years, and plan to continue the group’s goal of more than 100 in just the first five years. Art Whino hopes to increase tourism in the area and increase interest in the city to help local businesses thrive. What makes this art so special is the lack of a gallery - the gallery is simply the inviting, exhilarating city of Richmond. Further aiding the city, the muralists specifically target walls in areas that are in disrepair, to provide a positive catalyst for change. The artists are nothing short of gifted: the jaw-dropping art has generated massive amounts of press interest and attention, and 2013’s “Etam Cru” mural (pictured left) - located at 1011 W Grace Street - was dubbed #3 best street art in the world by Buzzfeed. Look forward to 2015’s murals; painting will begin July 13th and end July 24th. Words cannot express the impact this has made on the City, nor the beauty, magnificence and sheer size of the art. Go out and see it for yourself. Visit artwhino.com for more information on the project.
If you have a message for Richmond REALTORS速, homebuyers, or homeowners, please contact kwhitlow@rarealtors.com
4. Agecroft Hall Agecroft Hall and the neighboring Virginia
House, along with the entire area of Windsor Farms, is a jaw-dropping sight to behold. It all began more than 500 years ago in Lancashire, England, where the Hall was originally built. The massive Tudor-style home served the Langley and Dauntesey families who occupied it for almost half a millennium; but nature and time took a toll on the structure, and eventually the vacant and deteriorated home was put up for auction. In 1925, Mr. Thomas C. Williams, Jr., bought the home and prepared to have it dismantled, shipped about 3,000 miles west, and reassembled. Williams purchased the home for a mere $19,000, but reconstruction cost him a staggering $250,000. Keep in mind the gargantuan Branch House required almost half that to build from scratch. Mr. Williams had the ambitious idea of creating Windsor Farms, a neighborhood that consisted entirely of homes transported from England. The central green and English street names took their place and are still relevant today; but unfortunately only one other home, the Virginia House, arrived from England before the Great Depression hit and England restricted the relocation of its historic estates to America. The pair of homes and preserved antiquities are impressive, and Windsor Farms emits a serene, Old-English aura that necessitates a short drive through—even if you don’t have the time to stop and look around. The Virginia House requests a week-inadvance notice for a tour, while Agecroft Hall offers walk-in tours Tuesday through Sunday. Agecroft’s fifteen expansive gardens can be explored at any time, without opting for a tour of the home. Check out agecrofthall.com or vahistorical.org for more information. Shakespeare fans: Agecroft is no doubt a very fitting Shakespearean play venue because of its existence in England during his time—which is why Quill Theatre takes advantage of the setting to perform the Bard of Avon’s plays for two summer months each year during the Shakespeare festival.
5. Liberty Statue Welcome to Richmond: encounter the almost
400-year-old Virginia General Assembly that signed the Virginia Statute for Religious Freedom; St. John’s Church, Patrick Henry’s “Liberty or Death” speech location; and… the Statue of Liberty? While our copper lady isn’t entirely on par with New York’s, Richmond’s Chimborazo Park in Church Hill shows off “Liberty,” an 8 ½ foot recreation of the Statue of Liberty donated by the Boy Scouts of America in 1951. Chimborazo Park offers much more than “Liberty,” although a selfie with a person-sized Statue of Liberty, or a photo that tricks your friends into thinking you spontaneously left for New York City is worth the trip alone. Close by the monument lies the Powhatan Stone; which was part of and now overlooks “Powhatan Seat,” King Powhatan’s royal residence when Capt. John Smith established the first permanent English settlement in 1607. The park was once home to Chimborazo Hospital, arguably one of the largest Confederate hospitals that saw around 75,000 patients in just three and a half years and had an astounding mortality rate--around 5-10%. Richmond National Battlefield Park is headquartered here; it’s “Chimborazo Medical Museum” sits in a 20th century building where the hospital once was. Aside from the historical significance, the park offers a beautiful 180-degree view of the city, as if centered on the tip of a mountain. The park is named after Chimborazo Hill on which it rests—which was named for the inactive Ecuadorian volcano Mount Chimborazo that sits at nearly 21,000 feet. The popular Church Hill Dog Park is located on the lower eastern terrace. The recently renovated Chimborazo Playground and community garden is only a block away. The area offers a plethora of preserved and renovated sites to see and experience; one could spend an entire day exploring here with pets and family. See richmondgov.com/parks/ parkChimborazo.aspx to learn more. ■
THE BETTER HOUSING COALITION CELEBRATES 25 YEARS OF COMMUNITY TRANSFORMATION
On May 21, 2015, the Better Housing Coalition
held an event called Transform RVA to commemorate its 25th anniversary and inspire community partners to work together for the greater Richmond region’s advancement. More than 300 guests, including representatives from public and private organizations, residents, students, and non-profit leaders attended the full-day event at the Omni Richmond Hotel. Lisa Schaffner, with the United Network for Organ Sharing (UNOS), emceed a luncheon at the event—which included the presentation of BHC’s Golden Hammer Awards, a welcome from Mayor Dwight C. Jones, and a keynote address, “Essential Leadership for 21st Century Cities,” from The Honorable Henry Cisneros, Former Secretary of Housing & Urban Development. The Better Housing Coalition debuted a new video at the luncheon, which will be used as a tool (Click below to watch).
to help communicate the mission of the organization. After lunch, the event continued with several breakout sessions to ecourage open discussions on topics related to housing, education, and transportation. These included: “Getting Better with Time: Housing the Age Wave,” with Robert J. Adams, President of Housing and Development Advisors (HDA) in Richmond, VA; Heather Kauffman, Market Director of Virginia, Washington D.C., and Maryland for Humana, Inc.; and Sara Link, Director of Greater Richmond Age Wave Readiness Collaborative This session addressed the question: Where are the solutions for housing the oncoming age wave? It explored how the greater Richmond region can create a thoughtful housing platform for improved quality of life options for older adults as they age. “Home is More Than a House: Liveable Communities,” with Danny Avula, Deputy Director of the Richmond City Health Department; The Honorable Cynthia Newbille, Councilwoman for the Richmond City Council; and Rob Robinson, Chairman for Urban Design Associates (UDA) in Pittsburg, PA This session addressed the question: How can creating livable communities make our families healthier? It focused on how the greater Richmond region can leverage place-making strategies to help families to live healthier and enhance their overall well-being.
After lunch, the event continued with several breakout sessions, to encourage open discussions on topics related to housing, education, and transportation. “Wanted: Jobs that Make a Difference,” with Risha R. Berry, Project Management Analyst for the Mayor’s Office of Community Wealth Building in Richmond; India Pierce Lee, Program Director for the Clevelend Foundation; and “Mac” L. McGinty, Vice President of the Community College Workforce Alliance This session addressed the question: How does housing choice affect employment opportunity? “Good Places to Live = More Successful Students,” with Chris Brown, Director of Education and Engagement at the Local Initiatives Support Corporation (LISC) in Chicago, IL; Carrie Coyner, Chair of the Chesterfield County School Board; and Angela Ransom Jones, Director of Student Services in the Office of Family and Community Engagement for Richmond Public Schools This session addressed the question: How does housing choice impact student performance in neighborhood schools? It focused on how the greater Richmond region can help ensure the academic success of our children by improving neighborhood stability. “Building Neighborhoods for All: Civic Engagement,” with Amy Howard, Executive Director for the Bonner Center for Civic Engagement (CCE); Audrey Jordan, Consultant for the California Endowment on the developmental evaluation of the Sons & Brothers Initiative and the Center for the Study of Social Policy’s LA office; and Albert Walker, III, Community-Adademic Liaison for the Center on Society and Health at Virginia Commonwealth University (VCU). This session addressed the question: How can civic engagement create transformational neighborhood change? It examined how the greater Richmond region can learn from past neighborhood inequities and create stronger neighborhoods through authentic resident engagement. “A Tale of Transportation: Connecting Job Seekers to Employers,” with Steward Schwartz, Executive Director and Founder of the Coalition for Smarter Growth; Brian Smith, Assistant to the President and CEO for Organizational Advancement at Hampton Roads Transit This session addressed the question: How can a comprehensive transportation system propel our regional competitiveness? It explored how the greater Richmond region can better connect urban job seekers with employers who need dedicated, human talent for their business success. Click here to access slides and videos from each presentation during the event.