r/RealEstateDevelopment

Is Affordable Housing Dead? Or Just Not Allowed Here?

Is Affordable Housing Dead? Or Just Not Allowed Here?

There is encouraging news in the affordable housing crisis: nearly everyone supports affordable housing.

Unfortunately, there is also some bad news: nobody seems to want it built anywhere.

This strange phenomenon recently appeared again in a town in southern Delaware, where an ordinance had been passed allowing affordable cottage communities, which included smaller homes on smaller lots designed to bring the cost of living within reach of working families. After considerable time, money and effort had already gone into trying to make one of those communities a reality, a newly elected mayor and town council decided to repeal the ordinance just months after it had been adopted.

Affordable housing, apparently, remains extremely popular in theory only.

In practice, affordable housing has become a little like parking in a beach town. Everyone agrees there isn’t enough of it. Everyone insists something has to be done. And the moment someone proposes actually creating some, everyone suddenly has every reason why it shouldn’t be built “there.”

We encountered a similar situation in a town on Maryland’s Eastern Shore, where cottages were rejected in part because they supposedly didn’t “fit in” the community.

It is a peculiar argument.

Presumably, the people who would live in those cottages still “fit in” the community. They fit in just fine when they are cooking dinner at a local restaurant. They fit in when they are fixing someone’s air conditioner in July. They fit in when they are caring for patients at the hospital, teaching children, stocking grocery shelves, working construction, answering emergency calls or repairing someone’s roof.

However, these folks simply become incompatible with the character of the community at approximately 5:00 p.m., when their shift ends and they need somewhere to live.  At this point, they somehow no longer “fit in.”

This seems to be the modern affordable housing paradox.

Local governments hold workshops about the lack of affordable housing. Consultants prepare studies explaining the lack of affordable housing. Committees are formed to study the studies. Comprehensive plans announce that affordable housing is a priority. Elected officials give lofty speeches about nurses, teachers, firefighters and young families being priced out of their communities.

Then someone proposes actually building housing those people might be able to afford.

At which point everyone loses their minds.

The lots are too small.

The houses are too small.

There are too many houses.

There is not enough parking.

There might be traffic.

It doesn’t match the neighborhood.

It might affect property values.

 

And, of course, the most powerful force in local government suddenly emerges: “We support affordable housing. Just not this affordable housing.”

To be fair, communities should care about good design. They should care about traffic, density, infrastructure and compatibility. Not every project is appropriate everywhere.

But we also need to acknowledge that there is no magical formula for affordable housing consisting of large houses on large lots with large setbacks, low density, expensive materials, abundant parking and absolutely no neighbors who object to it.  That product already exists. It is called unaffordable housing.

If we actually want housing to cost less, something in the equation has to cost less. Smaller homes, smaller lots, shared open space, efficient infrastructure and modestly higher density aren't flaws in the affordable housing model; they are, indeed, the key to the affordable housing model.

Which brings us back to the original question:  Is affordable housing dead? Maybe not.

But it certainly does appear to be trapped in an unusually sophisticated bureaucratic purgatory where everyone agrees it is desperately needed, provided people can’t see it from their house and it doesn’t affect their life in any way.

 

 

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u/Squid_217 — 24 hours ago

Development Associate Role - Seeking Interview Advice

I have my second round interview next week for a Development Associate role at an institutional firm. Initial screening went well but was not technical/was more cultural fit focused. This next round I’ll be interviewing with a Sr Development Manager.

Background: I’m finishing up my MRED and come from the A/E/C consulting side. I would be coming in to the role a bit older than my peers (early 30s). I’m wondering if those who have made a similar pivot can share some interview advice related to how you positioned your analytical background? Financial modeling is an area where my skills are more academic than practical, having completed a number of pro formas in class. I only use Excel in my day job when putting together budgets or competitive analysis. I know the lack of field experience here will likely be brought up.

For those who made that pivot, how tough was the learning curve for you once you started? Did any interviewers test you on the more technical skills during the process? I’m not sure what to expect. TIA!

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u/Snoo55682 — 1 day ago

First Time Industrial/office/retail RE Investor: Mentors and Paths to Explore?

(I don't have the community karma for r/realestateinvesting or r/Entrepreneur, so here I am).

Howdy,

I am interested in beginning a project to purchase a very modest investment property. This is a long-term project; I’ll need years to save up the down payment. I’m curious what I should be doing now, at the outset. Here’s my profile:

- I have modest experience as a small business owner and in program management (just to say I’m good with moving parts).

- I’m located in Brooklyn, so I’d want to purchase within 3 hours of NYC. Currently most interested in Allentown or Philadelphia, PA.

- Just starting, so anything is possible, but I don’t foresee being able to do more than 500k with 10-20% down. This seems to lock me out of NYC proper. Am I correct here?

- Interested chiefly in industrial because it seems I can get more value from an industrial tenant (comm. storage?) than an office or retail tenant. I am not interested in apartments or living units for ethical and logistics reasons. Is my reasoning sound?

- I would do this as kind of a build-to-suit arrangement, bringing my prospective tenant along when I looked at potential purchases. This feels much safer than buying and finding a tenant later. Am I correct?

- I’m not imagining vast wealth here. My goal would be to make 2k profit/mo. Is that realistic from a 2-6000sq ft rental in the Northeast?

- I have a recognized severe disability (mentioned here for possible loan program eligibility).

- I would specifically want to conduct myself ethically. No displacement, firm but fair, no business I don’t morally align with. Anyone have experience here?

I feel like people might read all this and think I’m planning a ridiculous amount of work for 24k/y. But my entire purpose of investing is to fund an art studio for my private art practice. 2000 dollars a month would give me leeway to do that and then some. Furthermore, with the economy the way it is, I feel like the future may be working for myself, not waiting to get laid off (read: I'd be interested in growing this to an actual living). Do my modest initial goals open any pathways for me here? Lastly, what do you wish you knew when you were just imagining real estate investment? 

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u/_Haverford_ — 2 days ago

Construction Management to Real Estate Development

I currently work as a project manager estimator with about 4-5 years total experience in heavy civil. I started a masters in financial analytics from a state school that is non target. Is it possible for me to pivot into real estate development / real assets or is that too much of a stretch due to it not being an MRED? I am really curious about this to try and see what possible opportunities I would have post grad. I have always been interested in real estate development and infrastructure. Any advice is greatly appreciated!

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u/CactusDude77 — 3 days ago

Neighborhood Development Permit - building in San Diego

Have you ever built a house in San Diego? Did it require a Neighborhood Development Permit? Do you have knowledge of the Development Services Department in the city of San Diego? Just looking to see if anyone else exists out there in the same boat. My husband and I have land in City Heights. We have been working for 2+ years to get a building permit and a grading permit. For reasons too boring to explain, we are our own project managers and we are building the plane while we fly (the biggest reason is $). I’m just hoping to commiserate with others. We are making headway but every time I think we are close to resubmitting for the building permit or submitting for the grading permit, something else pops up. When something else pops up, it’s always time and money to meet that need. It almost feels like the city doesn’t really want us to build there. We aren’t dumb people but we aren’t architects or civil engineers. When we try to educate ourselves on the DSD website, we drown in the sheer amount of information. #sandiego #architecture

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u/NDPinSD — 4 days ago

Sanity-check: Thinking of pooling investor money to buy land + build houses in a tier 1 city.

My father has been building residential buildings as a hobby for friends and family for around 20 years and has completed over 15 projects. I’m thinking of turning this into a small business.

The basic idea is to pool money from a few investors, buy a plot, build a house with my father directly supervising the construction, sell it, and then share the profit based on how much each person invested. My father would get a fee/share for managing the construction, and I’d handle the business and investor side.

I’m planning to start with just one small project, mostly funded by close friends/family, and see how it goes before thinking about taking money from others.

I’m already discussing the legal, tax, and agreement side with a lawyer and CA, so I’m not really looking for legal advice here. I’d mainly like to hear from people who have actually done something similar, either as an investor or someone running the project.

What problems came up that you didn’t expect? Anything with contractors, investors, construction timelines, or cash flow that became a bigger headache than you thought?

And if you invested in something like this, what would make you trust the person running the project? What would make you walk away?

Also, for anyone who started with one project and eventually did this repeatedly, what tends to become difficult when you move from the first project to the second or third?

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u/Subtly_Unseen — 4 days ago

Contemporary Oakland listing gaining no traction

Hello all,

I (M60) put up two brand-new, contemporary-style houses on the Oakland market (Crocker Highlands, to be exact) in June, and it has not attracted much attention since then. Given its desirable condition, I am stumped as to whether I have chosen the wrong style for the neighborhood, have not been marketing it properly, or if the current state of the market is simply having its way with us.

I was certain that this house style would sell reasonably fast, since I'd had success with it in the past. Is there something I'm not seeing?

Above are some photos, if it helps.

u/Zazzafrazz100 — 8 days ago
▲ 5 r/RealEstateDevelopment+1 crossposts

Architecture to Real Estate Development

I recently graduated with my B.Arch and worked a year post-grad at an architecture firm and interned full-time for a planning firm while in school. Through those work experiences and networking, I was able to gain a deeper understanding of design and development. After a lot of reflection and research, Ive decided to make a career pivot from design to development.

I know many design professionals make this career pivot later in their careers. I am an emerging professional with less work experience and have been considering graduate school to help in the transition. I am contemplating pursuing a Master’s in Real Estate Development and hoping that will connect me to internships that will eventually lead to an entry-level development job. Is there another approach I should be considering? Any advice would be much appreciated.

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u/Awkward_Ad_5313 — 6 days ago

LIHTC Development - CA

I’m building an affordable housing development platform focused primarily on LIHTC in California, and one of the biggest things I’ve run into is just how difficult the barriers to entry are for an emerging developer.

Guarantee requirements, demonstrated project history, balance sheet strength, nonprofit participation and other experience thresholds can make it difficult to execute even when the underlying deal is strong. That’s a big reason I’m interested in hearing from people across the entire LIHTC ecosystem and understanding how others have navigated those hurdles.

The current focus is ground-up, 100% affordable multifamily, generally in the 70 to 320-unit range, with an emphasis on projects that can be built efficiently without relying on large public funding gaps. Most of what I’m pursuing is mid-rise multifamily, including Type III and podium construction, with repeatable unit plans and a strong focus on controlling basis and overall development costs.

Entitlement certainty is also a major filter. I’m focused on California today, but I’m open to other markets where zoning or state/local law provides a genuinely codified, objective pathway to approvals and meaningfully removes discretionary entitlement risk.

I’d be interested in discussions with anyone involved in the actual mechanics of getting these projects built: developers, nonprofit partners, tax credit investors, lenders, construction lenders, architects, GCs, syndicators, attorneys, consultants, property managers, public agencies, bond professionals, policy people or anyone else deeply involved in affordable housing.

Some areas I’m particularly interested in:
• GP equity, guarantees and co-development structures
• Emerging developer participation and track-record requirements
• Nonprofit partnership structures and participation requirements
• LIHTC structures that work without traditional soft-funding gaps
• Acquisition and predevelopment capital
• Tax credit equity and debt execution
• Construction cost reduction and repeatable design
• Entitlement frameworks that materially reduce land-use risk
• Workforce housing as a complementary or fallback strategy
• Policy changes that could unlock significantly more production
• What experienced developers think newer platforms consistently underestimate

Not selling anything and not looking to turn this into a generic “let’s connect” thread.

I’m trying to build something that can produce affordable housing repeatedly and at meaningful scale, while also figuring out how to overcome the institutional barriers that make it so difficult for new developers to enter the space.

If you work anywhere in the LIHTC world, I’d be interested in hearing what you think the hardest barrier to entry actually is and how you’ve seen people successfully overcome it.

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u/CallMeBlinks — 10 days ago
▲ 9 r/RealEstateDevelopment+1 crossposts

Developer is planning a large housing/hotel development, my property is the key to it all from the looks of it

I’m hoping to get some direction. I live in a small, working-class town in Northern Michigan on a Great Lake that has recently seen a boom in tourism and retirees.

A city rep showed up at my house to tell me a developer wants my property for a proposed development that totals 71,400 total square feet: a 49,000 sq ft, 3-story hotel with a rooftop bar overlooking the lake, plus 22,400 sq ft of townhouses (12 units, 2 levels each).

he initially made it seem like a courtesy to let me know a big project was starting all sides around me and there's nothing anyone can do to stop it, hotel guests would have direct views into my yard, my privacy fence would not protect me and there would be activity on all sides of me, making the living situation very uncomfortable

I pressed a bit saying...ok? why would they ask you to speak to me then? seems like its happening no matter what and he mentioned they'd be willing to pay to move my home ( its a 98 year old foundation, framed with literal recycled ship lumber from the nearby port in 1926) its not moving, or buy it from me, insinuating this is out of kindness so I wouldn't be annoyed for the rest of my days

I got ahold of the draft of plans and it's clear all of the plans involve the acquisition of my home and demolition thereafter, the story I was told I believe was brief attempt to startle me enough, hope I didn't ask a single question and went and put my house on the market that night. I work in manufacturing/agriculture operations and understood some basic nuances taking place pretty quickly

The Nuances: My property is dead center in the middle of this proposed development.

  • The Land: I have a grass city owned lot on one side, a city lot/garage across the alley on the other side, and a large city lot with a recently renovated building on the far side, slated for an event center behind me. All these city lots (which are owned by the DDA) are in the plans for this development. My property takes up the footprint of about 4 of the proposed townhouses and prevents them from eliminating the alleyway, i think?.
  • My Stance: I had no prior intention of selling. I would have to be really impressed to even consider relocating, and the relocation would practically have to be facilitated for me with a significantly better situation, considering my current setup is great. I own a fully remodeled 2,600 sq ft, 98-year-old craftsman with a full perimeter privacy fence, a lofted barn, central AC, whole-home air/water filtration, and a large rear deck. I have Great Lake views from a second-floor bedroom and front porch.
  • The Financial Reality: I bought this house in 2021 for $172k at a 3.5% interest rate. I estimate the current market value at $250k-$300k. But current rates are around 6.7%. Even if they offered me 120% of the market value, it’s not a 1:1 move. I would lose my lake views, incur moving costs, and trade a 3.5% mortgage for a 6.7% mortgage in an increasingly expensive market. Some comps of similar sized homes near the lake for example were going for 325k a year ago and are between 500-600k now (newer homes with some land on the edges of town)

crunching some numbers I came up with this in terms estimated costs of this project

Commercial construction costs in the Midwest for mid-scale to boutique properties currently range from 250-400 sqft, heavily depending on finishes (like a rooftop bar).

  • The Hotel: At 49,000 sq ft, a 3-story hotel with a rooftop restaurant/bar requires heavy structural steel, elevator shafts, and commercial plumbing/HVAC. Estimated cost: $14.5 million to $19.6 million.
  • The Townhouses: At 22,400 sq ft, commercial-grade townhouse construction (often requiring firewalls and premium waterfront finishes) will run roughly $200 to $300 per sq ft. Estimated cost: $4.4 million to $6.7 million.
  • Site Work & Soft Costs: Permitting, architectural fees, tearing up the alleyway, running new municipal utilities, and landscaping will easily add another 15% to 20% to the budget. Estimated cost: $3 million to $5 million.

Total Estimated Project Cost: $22 Million to $31 Million

My Questions:

  1. What kind of power do I actually have here? Can the city force me out to hand my land to a private developer?
  2. with my property sitting on city street and two city alleyways, those two alleyways separate the adjacent lots from my land, if I don't sell, what can they do to eliminate these alleys, if anything?
  3. How do you even determine "comps" for a situation like this where the city is likely transferring their DDA lots for little to nothing, and I am the only private parcel they need?
  4. What kind of attorney should I contact?

Update:

A huge thank you to everyone who commented! I uncovered a piece of the puzzle: the Michigan Economic Development Corporation (MEDC) is the entity pushing the city to talk to me.
To get multi-million dollar state "gap funding" for a project this size, a developer has to prove total "site control"—meaning their plans and property acquisition must be completely locked in before they can even apply. They cannot secure state grant money with a private homeowner sitting dead center in their blueprints.
So far some reason they want me aware of the situation before the developer even reaches out, assuming they want to streamline the funding process and making me get my shit together so there isn’t delays

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u/Fine_Tangelo2985 — 11 days ago

LF: Books About the Process

Hi everyone, I am a 41 year old carpenter/builder who is totally naive about the building process from an executive perspective. I am looking for books about financing, land procurement, grants or partnerships or anything really that will assist me in my own aspirations for my own custom build. I have consulted AI for recommendations and the offers are scant hence why I'm asking here. I don't need literature on the physical part of or designing of the build however if there is something that includes that information that is fine. I understand there are online resources available, I am requesting books because I just prefer the tactility of books.

Thanks.

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u/OverExtension5486 — 10 days ago

Due to Religious reasons i can not assist in interest directly, I dream to be a real estate development director, but i am just wondering if they have to directly assist in interest or is that usually the job of the finance team.

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u/Consistent-Cod254 — 11 days ago

Real estate professionals: how would you approach this market?

I’ve been working in real estate in Quintana Roo, Mexico for about 1.5 years, mainly with high-end residential land.
One thing I’ve noticed is that many potential buyers seem more interested in finished properties than buying land and building a high-end home themselves.

So I’m curious, for those working in other markets, is this something you’ve experienced too?
And for investors: would you consider buying a high value residential lot in a developing area, or would you rather buy a finished property with an existing rental strategy?
🧐🤓

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u/Isab-Cancun — 10 days ago
▲ 4 r/RealEstateDevelopment+1 crossposts

Manufactured homes on land rather than flipping?

Ive been flipping a few houses each year. Obviously good deals are harder to find all the time. Ive been looking into buying lots, overlooked parcels, parcels with worthless structures on them, etc and installing manufactured homes on them to develop the property and sell.

Wonder if anyone is having success with a similar strategy that might share some tips.

Im located in Michigan

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u/reinvestor-roofer — 13 days ago

New to Florida CRE – Looking to Learn

Hi! I’m new to Florida and don’t really use Reddit to post, so sorry if I have this wrong.

I recently moved to Orlando for the Disney College Program and am a business student at the University of New Mexico. This summer, I completed an internship with a commercial real estate investment firm, where I worked on underwriting, market research, and investment analysis.
Long term, I’m interested in commercial real estate, especially multifamily and hospitality.

While I’m here, I’d love to learn more about the Florida market, hear different perspectives, and connect with people in the industry. I’m also happy to share what I’ve learned so far if it’s helpful.

Looking forward to learning from everyone!

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u/NumerousCut2375 — 12 days ago