Affordable Housing In an Unaffordable City
The Wall Street Journal had an interesting graphic earlier this week that looks at an affordable housing project in Ft. Greene, Brooklyn. The $27 million project will have 101 two-bedroom units that will rent for between $600 to $950 a month.
So, the project cost about $270,000 per unit to build these affordable apartments. This makes me wonder, how close is this figure to the cost of construction for market-rate units in Brooklyn? I imagine that low-cost financing from HDC kept costs down, and that the quality of the units is probably slightly lower than that of luxury housing (no granite counter tops in these units, I’m guessing). But I would guess that the cost of constructing market-rate units isn’t that much higher to justify the outrageous prices that consumers have been willing to pay in Brownstone Brooklyn.
The median price of a two-bedroom unit in Ft. Greene, according to StreetEasy.com, is $627,000. I doubt that the cost of construction for market rate units is really almost three times as high as the cost for building affordable units. But apparently, this is what the market can “bear”, at least the luxury market. But as housing becomes unaffordable to all but the wealthiest households, the city needs to examine what can be done to bring housing costs in line with the cost of construction.