CSG in the News: “Program Helps DC Homeowners Provide Low-Cost Housing — and Build Wealth”

by JARED BREY, Next City, FEBRUARY 18, 2020

…With the ADU D.C. program announced last August, UPO [United Planning Organization] is trying to find ways to make ADUs cheaper and easier to build for moderate-income homeowners like [homeowner Lawrence] Foster. The program is starting as a small pilot: just two handpicked homeowners are participating so far, according to Kay Pierson, director of the community reinvestment division at UPO. It was created in partnership with the Coalition for Smarter Growth, and supported with a $180,000 grant from Citi Community Development. (Note: Citi Community Development also provides funding to Next City.) A lot of UPO’s programs are focused on helping people in poverty, with services like emergency rental assistance, Pierson says. But the ADU D.C. program is part of a series of efforts aimed at “asset development” — helping build wealth in lower-income communities — she says. The organization went looking for homeowners who earned up to 80 percent of Area Median Income (AMI is $121,300 for a family of four in Washington), and who had good credit, steady employment history, and equity in their homes. And the partners are hoping that the pilot program demonstrates ways that the city and others can help moderate-income homeowners create more ADUs….

The Coalition for Smarter Growth in Washington had been advocating for those kinds of rule changes for several years. The benefits just pile on top of one another, says Cheryl Cort, the Coalition’s policy director: ADUs can take advantage of partially developed and underused space, provide space for seniors to age in place or for family members with special needs, provide rental income for homeowners, and promote small-scale living, which has a smaller impact on the environment.

“And adding rental housing options can bring new types of housing to established neighborhoods that might have few rental options today, including high-priced neighborhoods close to the Metro or in-demand schools and other amenities,” Cort says. “It’s natural diversification of the housing stock, rather than just being uniform.”

Still, Cort says, it can be expensive to build a new unit, even when taking advantage of existing space. She says she’s talked to a lot of architects who are approached by homeowners to consult about adding an ADU, only to have the homeowners walk away when they hear the cost, which is typically around $150,000, according to Cort. (Other cost estimates for ADUs here.) As part of the ADU D.C. program, the Coalition is producing a manual for homeowners to help navigate the permitting process, and the partners are also working with the Department of Consumer and Regulatory Affairs about ways to make permitting easier and faster for accessory dwelling units. And they’re exploring how financing programs might be scaled up to provide financial help for more moderate-income homeowners.

Last fall, D.C. Mayor Muriel Bowser announced a goal of producing 36,000 new homes in the District by 2025, with at least 12,000 of them being affordable to low-income residents. The city’s Housing Equity Report released at the same time has specific affordable-housing production targets for 11 different areas of the District. Those targets will help focus the city’s efforts, Cort says. And accessory dwelling units can be part of the mix of new housing that helps meet that goal, especially if the city can find ways to help moderate-income homeowners house lower-income tenants. The ADU D.C. program is meant to help show that tailored assistance and financing can produce more units.

“It’s a retail game,” Cort says. “We’ve got to be working individually with homeowners.”

This article is part of Backyard, a newsletter exploring scalable solutions to make housing fairer, more affordable and more environmentally sustainable. Subscribe to our thrice-weekly Backyard newsletter.

View the full story in Next City here.