Build expensive new “luxury” apartments, and wait a few decades
One of the most common refrains the the affordable housing discussion is “developers are targeting the high end of the market” and new apartments are just unaffordable.
Although we–and others–have pointed out that building more high end housing keeps those with high incomes from moving down market and out-bidding those with less income for the existing housing stock, we still hear this argument. For remaining doubters, have a look at Noah Smith’s thought experiment, asking what we think would happen to housing prices if we suddenly demolished 10,000 units of expensive housing.
But today, we take a slightly longer perspective. Housing blogger Iain MacKenzie, who runs the definitive Next Portland website, tracking new housing and commercial developments in the Rose City, shared with us a couple of fascinating historical clips from the city’s paper of record, The Oregonian. They show that today’s affordable housing often started life as self-described “luxury” housing when it was originally built.
The first example dates back a half century, to the 1960s, when in the wake of urban renewal the city was building a wave of new apartments. The Oregonian of January 9, 1966 described the city’s booming market for new luxury accomodation:
“Luxury apartments, which start at $135 for a one bedroom unit and rapidly climb out of sight, have been sprouting in Portland at a breathless rate, and more are planned or abuilding. The total investment in such properties is certainly above the $100 million mark here.”
One of these complexes was the Timberlee in suburban Raleigh Hills, a close-in suburban neighborhood. According to the Oregonian, the Timberlee on SW 38th Place was one of the most prosperous of the 13 apartment complexes it examined in its story, with 97 percent of its 214 units rented.
Of course, the Timberlee Apartments are still around. While none of the units are currently for rent, according to Apartments.com, rents in the area run from about $1,000 for studios and one bedroom to $1,300 and more for two bedroom and larger apartments. By today’s standards, the Timberlee seems modest, and a bit dated, rather than luxurious.