Beyond Zoning Changes: How Housing Trusts Promote Affordability

When residents in Lower Merion were being priced out of their community in the early 1990s, several of the town commissioners took steps to keep their community affordable. “They wanted to make sure the township had an economically diverse population,” Mike Leibowitz told me recently.

Mike is the chair of Lower Merion’s housing trust, Lower Merion Affordable Housing (LMAH). (He’s also the president of his local fire company, Station 28.) He, as much as anybody, is responsible for the township continuing the work it started 30 years ago. Mike and his colleagues are still trying to keep the community affordable to a wide variety of people.

Lower Merion is an affluent suburban Philadelphia township with a high-performing public school system often compared to Swarthmore’s. But it’s only recently that housing prices in Swarthmore have started to rise to comparable heights. Lower Merion has a few decades of experience strategizing about how to maintain an economically diverse population—something that our borough is just starting to wrestle with now.

Of course, Lower Merion is about 10 times as big as Swarthmore, and it has a lot more land. What works there would not necessarily work here. But it was inspiring to talk to Mike and hear what LMAH has accomplished over the last 30 years.

A More Direct Approach to Affordability

Most of the posts on this blog have been about zoning. Specifically, they’ve looked at how changes to zoning laws can help make housing more affordable in towns like Swarthmore.

But there are more direct ways to make housing affordable than by changing zoning laws and hoping that builders and homeowners will take advantage of the changes.

For example, you can create housing units available only to people whose household income falls below a certain threshold. Indeed, this “income-qualified” housing is what most people think of when they hear “affordable housing.” (That’s part of the reason I often use language like “reasonably priced housing” and “attainable housing”—to encourage us all to think more expansively.)

Building income-qualified housing can be very expensive. Sale prices and rents do not necessarily make them appear like worthwhile investments. But developers can get subsidies to build income-qualified housing, with the money coming from federal or state governments, or from philanthropic giving from foundations, businesses, and individuals. The Lower Merion housing trust Leibowitz leads brings in money from the federal Department of Housing and Urban Development (HUD), Pennsylvania Community Development Block Grants, county affordable-housing funds from real estate transfer taxes, some of the township’s American Rescue Act funds, community money from local banks, and board fundraising.

In many communities, this funding is funneled through a housing trust, which is often a nonprofit organization dedicated to helping lower- and middle-income people find and stay in homes. That’s how it works in Lower Merion.

Lower Merion Affordable Housing helps first-time home buyers purchase houses in their community. Photo courtesy of LMAF

Lower Merion Affordable Housing

The housing trust in Lower Merion does four main things, Leibowitz told me.

1. They develop one large affordable housing project every five or six years. Each one is a major undertaking.

One example is Ardmore Crossing, where apartments and townhomes are available to a combination of low- and moderate-income renters and market-rate purchasers. The award-winning project is located on a former brownfield, which was rehabilitated to create the mixed-income project. At another project, 13 St Asaph’s, in Bala Cynwyd, LMAH is working to add seven new units of income-qualified units to an older, six-unit site.

2. They buy and rehabilitate single-family homes, then help first-time, low-to-moderate income buyers purchase them. The homes are sold at market rates, but LMAH gives qualified first-time home buyers a zero-interest second mortgage plus help with closing costs. The mortgage is 75% forgivable if the buyer stays in the house for 20 years. People who work for the township, like school teachers and volunteer firefighters, get first dibs.

“A trash collector for Lower Merion bought the last house,” Leibowitz told me. “He was so happy to be able to live in the community.”

3. They host free financial literacy workshops, including a session on home-buying. Offered in collaboration with the nonprofit Genesis Housing, these workshops provide information that helps people better manage their finances with a focus on getting in a position to buy a home. Anyone who completes all three sessions is eligible for a year of individualized financial counseling.

4. They advocate for changes to support affordable housing in the township and beyond.

“We’re lucky to have strong support from Lower Merion Township,” Leibowitz says.

Beyond Lower Merion

Lots of communities have housing trusts. The one in Falmouth, Massachusetts, has rehabilitated many single-family homes and sold them to first-time buyers. Bend, Oregon, also uses its affordable housing funds to construct and rehabilitate deed-restricted, income-qualified housing. Some of its funding comes from the city’s fee on building permits of one-third of 1%. Mountainland Community Housing Trust in Park City, Utah (population 8,400), has helped create over 900 affordable housing units over the last 30 years and is currently establishing a housing advocacy center.

Could such an organization exist in Swarthmore? If so, how could it be funded and what would the money go for?

Land prices are so high here—and we’re blessed with so little blight—that buying even a rundown property would be a major undertaking. We have next to no vacant land. But maybe a housing trust could offer assistance to someone struggling to keep up with rapidly rising rents or to afford repairs to an old house they’d like to keep living in. If Swarthmore combined a housing trust with targeted zoning changes, it could help a homeowner on a fixed income build an accessory dwelling unit (like a garage apartment) to rent out to help pay their real estate taxes.

Given the high cost of land here and the generally good upkeep of our properties, it would be hard for Swarthmore to successfully compete for government funding for income-qualified building projects. Could a housing trust be funded in part by a percentage of the borough’s fee on building permits (or something else)? Could it raise money privately? Would local businesses, including Swarthmore College, consider contributing to a fund aimed at keeping Swarthmore accessible to people with a range of incomes? Would you?

A Planning Commission member in Norwich, Vermont, who helped me understand housing trusts better, said, “Writing a check for $50 gives people who care about the issue something to do.”

As we think creatively about maintaining economic diversity in our town, it would be a mistake to ignore what is so often the crucial piece of any difficult puzzle: money.

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“Everyone Can Reap the Benefit”: Delaware County’s Housing Plan

When I first started looking into what other communities were doing to address the housing affordability crisis, my research took me west and north.

California and Minneapolis are well-known for using zoning changes as a tool to provide more reasonably priced housing. Connecticut and Massachusetts are actively working toward that goal as well. My uncle recently sent me this optimistic story from Falmouth, Massachusetts, on Cape Cod. The crowded tourist town is permitting property owners to rebuild some commercial spaces with up to 20 housing units if at least a quarter of them are deeded “affordable.” The proposal sailed through the town meeting.

(There are, unfortunately, cautionary Massachusetts stories too, like this one about wealthy suburban towns willing to forgo state grants rather than build more housing near transit hubs—transit oriented development being central to Republican governor Charlie Baker’s Housing Choice plan.)

What’s Happening Locally?

After learning about what was happening elsewhere, I started reaching out locally to see who is working on affordability closer to home.

I met with two staff members of the Delaware Valley Regional Planning Commission (DVRPC), who explained that they are at the very beginning of their work on housing affordability. Learning of Swarthmore’s Task Force on Development and Affordability, they offered their support.

The DVRPC staffers sent me links to articles on “missing middle” housing—like duplexes, triplexes, and quadplexes—from the American Planning Association and Zillow; to their own study of how multifamily housing benefits communities; and to a report on how mixed-use development and a diversity of housing types helps make communities resilient.

Then they connected me to staff in the governmental offices of Delaware County.

Rebecca Ross, Principal Planner, worked on Delco’s comprehensive 2020 housing plan. This plan stresses the importance of housing diversity, urging all 49 municipalities to develop different types of housing at different price points.

Noting that local zoning often favors single-family homes, the plan encourages missing middle housing and promotes accessory dwelling units, a.k.a. ADUs, in-law apartments, or granny flats.

The Delco plan explains how increasing housing variety helps more prospective home buyers to enter the housing market. Smaller homes at lower price points enable more people to

build equity, eventually moving “up the ladder” of housing as their needs change. Allowing people to add ADUs to their properties and offer them for rent also provides a potential income source for homeowners, which could help alleviate costs.

Much of the county’s work on housing focuses on income-qualified projects that are eligible for federal, state, and county funding. But Delco is beginning to pay more attention to “attainable housing”—that is, market-rate housing for first-time home buyers, younger families, and middle-income earners.

Ross said she saw Swarthmore’s task force as a useful response to “a growing, ongoing need for our communities to look more holistically” at housing overall.

“No one community should be bearing the brunt of high housing prices,” she said. “And no one community should bear the brunt of disinvestment.”

If municipalities across the county work together, Ross said, “Everyone can reap the benefit.”

What Else Is Happening in Delco?

Ross and her colleague Sarah Carley pointed me to other local communities that are tackling the affordability problem. Mostly these places have different situations and populations than Swarthmore (more land, more people, less wealth). Phoenixville’s new Council on Affordable Housing is working on public-private partnerships for new development and is developing a grant program to help low-income buyers afford homes. Upper Chichester is experimenting with land banks. Media, which has experienced its own explosion in housing costs—has a new group addressing affordability.

On the one hand, I had hoped to see more efforts to alleviate the housing crisis.

On the other hand, it’s exciting—and a little sobering—that what we do here in Swarthmore can serve as a model for our neighbors.

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“Rethinking Federal Housing Policy,” or, What One Swarthmore Resident’s National Perspective Suggests About What We Can Do in Our Small Town

If you’re working to make your small town’s housing more affordable, and that town turns out to be home to a well-known housing economist with a book about the affordability crisis, you probably ought to read that book. 

A couple of months ago, I learned that Joseph Gyourko, a professor of real estate, finance and business economics, and public policy at the University of Pennsylvania’s Wharton School, lives right here in Swarthmore. Or rather, I knew a guy named Joe Gyourko lived in Swarthmore; our daughters had been friends back in elementary school. What I learned was that this neighbor was a well-known housing economist.

One surprise about Rethinking Federal Housing Policy: How to Make Housing Plentiful and Affordable, which Gyourko wrote with Edward Glaeser, was how readable it was to a non-economist like me: lucid and direct.

As the title suggests, the book is largely about what the authors think the federal government should do to address the affordability problem. But a lot of what they say has implications for what can be done on a smaller scale—a borough scale—too.

We Need More Housing

When they published their book in 2008, Gyourko and Glaeser already observed that in a “growing number of metropolitan areas, housing prices have soared, making housing unaffordable even for middle-income Americans.”

The main reason? “Stringent land-use regulations make it too costly to change the quantity of housing very much.”

In other words, while zoning serves an important function, overly restrictive zoning laws were making it nearly impossible to build more housing, which was driving prices up. 

This is still the case—and it’s very relevant to the housing situation in Swarthmore.

Two Affordability Crises

One still applicable tenet of Gyourko and Glaeser’s book is that America is suffering from two separate affordability crises with different causes and different solutions. 

One crisis is that many people are so poor that they struggle to afford any housing, even inexpensive housing. 

Another is that, in many parts of the country, housing has become unaffordable to even middle-income people. 

Unless you understand which crisis you are talking about, the writers explain, you’re not going to be able to implement a solution.

I found this extremely clarifying.

In my reading and thinking about affordability over the last year, I’ve often found myself stuck in a thicket of confused ideas about what “affordability” is. I wrote about this a few weeks back in a post called “What Is Affordability Anyway?”

Gyourko and Glaeser helped me see how the word “affordable” is such a flexible, protean term that it can be more obfuscating than useful.

Their book spends most of its time discussing the lack of housing affordable for middle-income earners. The principal solution, the authors argue, is to loosen local zoning restrictions in unaffordable markets to encourage the creation of more housing units. 

Gyourko and Glaeser argue for limiting the federal mortgage-interest deduction and sending the resulting tax dollars back to municipalities that build housing. This is a national and therefore efficient approach, but not one I imagine seeing implemented any time soon.

So What Can We Do Locally?

Loosening land-use restrictions in Swarthmore alone would likely not drive down the price of existing homes. That would probably require changes across the Philadelphia metropolitan area. But it could open the door for the creation of housing units at lower price points.

Other communities have done just that by, for example, permitting accessory dwelling units (ADUs) to offset the cost of homeownership while providing affordable rentals. They have rewritten their zoning laws so large houses can be divided into several condominiums. They have designated areas for townhomes like Swarthmore’s Village Green near the Princeton Avenue underpass. 

Changes like these could make our town more accessible to middle-income earners like teachers, small merchants, data-science consultants, writers, and college professors who were able to afford to buy homes in Swarthmore twenty years ago but mostly can’t anymore.

As for the poor who struggle to afford even inexpensive housing, Swarthmore has long been mostly out of their reach. A 1972 proposal by local religious leaders that the borough allow twenty units of subsidized housing went down to defeat. The words of one of the proposal’s advocates at a borough council meeting, quoted in the January 23, 1973, issue of The Swarthmorean, show that our forebearers half a century ago had some of the same concerns many of us do today: “[The proposal] bears on Swarthmore’s ability to remain an open, socially mixed community in which material achievements aren’t the only measure of human worth.”

An article in the Delaware County Daily Times described an exchange, not mentioned in The Swarthmorean’s account of the meeting, in which a citizen named William Allen Raiman said the proposal “would little by little make one big Scrapple Hundred out of Swarthmore.” Scrapple Hundred is a derogatory term for the Historically Black Neighborhood of Swarthmore. 

I’m guessing no one in Swarthmore today would speak that way in a public meeting. But I worry that opposition to making housing more affordable is driven in part by stereotypes and prejudices about the kind of people who would live in it.

I’d like to think we could find ways to make Swarthmore more accessible to low-income workers, especially those employed in our community as restaurant servers or custodians at Swarthmore College or home health aides. 

Two Takeaways

One optimistic nugget I unearthed from Gyourko and Glaeser’s book is the idea that—since the lack of affordability for middle-income earners is largely the result of overly restrictive zoning policies—changes in government policies can supply solutions.

Here’s a more ambiguous nugget. The book notes that in some big cities, mayors fight for the creation of housing units so city workers can afford to live near their jobs. But, the writers continue, “In leafy suburbs…there is no group to oppose existing homeowners’ natural desire to restrict construction.” 

As I read this, I found myself wondering how, in our own leafy suburb, such a group might be created. 

I chair Swarthmore’s Development and Affordability Task Force, which is charged with making recommendations to our borough council next year. But beyond that, a critical mass of residents who see the benefits both to themselves and to others in creating more affordable housing in Swarthmore will be crucial to bringing about change.

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