As Oak Park trustees consider how best to provide low income/affordable housing, I offer these cautionary observations. I used to manage a portfolio of low/moderate income apartment projects and concluded that new construction is generally not the best way to provide low-income housing. New construction is very expensive. It is generally not economically possible to build high-quality housing for low-income people. Therefore, newly-constructed low-income housing quickly becomes an increasingly expensive maintenance problem. The projects lose more and more money, and so more and more maintenance gets deferred.
In addition, a stigma is generally attached to those living in buildings reserved for low-income tenants. Residents of these buildings experience this stigma. They don’t get a firsthand chance to know more economically successful people and aspire to similar success. Moreover, middle class people generally do not want to live near these buildings, fearing crime and declining property values. This makes it politically much more difficult to construct them.
There are good reasons why the Chicago Housing Authority no longer builds low-income housing and has turned to mixed-income projects. Please don’t repeat their mistakes. Use the developer money to subsidize rents in existing buildings or include affordable units in new construction.