The key to unlocking more affordable housing options may turn with supply and demand, at least that’s what some Scottsdale City Council leaders think.
A regional problem plaguing people, Scottsdale’s elected leaders recently gave consideration to forming a Housing Affordability Working Group to make efforts toward unlocking an ongoing affordable housing issue.
While opinions on average monthly rental prices differed during the study session, data shows the majority of Scottsdale’s employees drive to the city from other Valley neighborhoods.
Data shows of the 200,059 jobs within Scottsdale, 166,549 of those workers commute to Scottsdale. Also, there are 33,510 people who live and work in Scottsdale; while 76,094 people live in Scottsdale but work elsewhere.
Apartments and its place within Scottsdale’s housing stock was discussed as well, with elected officials doubling-down on increasing supply.
“We get a lot of push-back from people saying ‘Oh my God, why are you building more apartments?’ And, I think it is important for residents to understand that we are trying to provide a continuum of housing. Not everybody can afford the multi-million dollar houses in north Scottsdale, but in order to have a healthy and diverse community, we need housing at different price points and that means increasing supply. As much as people don’t like to admit it that’s kind of what’s going to have to happen,” said Councilwoman Tammy Caputi.
During a recent study session meeting, Irma Hollamby, Scottsdale community assistance manager, presented initial recommendations gathered from the input of several city agencies and departments, including planning development, real estate, economic development, tourism and police.
Officials say some repercussions of a shortage of affordable housing can include:
Displacing community members
Losing current and potential workers
Lowering community spending power
Hindering economic growth
The team was convened as a result of Councilwoman Linda Milhaven’s July motion unanimously supported by the council to explore housing affordability.
“We heard from a previous speaker at a previous meeting a little bit about supply and demand, right,” Milhaven said, explaining she wants to look broader than low-income housing.
“What are the broader market forces that are making housing so expensive in Scottsdale and what more can we do and get into that supply and demand conversation that says ‘where’s the equilibrium, what’s the right number?’ If we can get some sense in where is that equilibrium in supply and demand?”
One perspective
Councilwoman Kathy Littlefield voiced extreme worries about the housing situation in Scottsdale.
“This is the area that has been very concerning to me for quite a while now because I’ve watched this unfold in Scottsdale. It has not gotten better it has gotten worse over time. So, I have been trying to educate myself into some of these issues and what can be done and what can’t be done,” Littlefield said.
She mentioned that Arizona law does not allow local governments to subsidize housing and wanted clarification on that concern.
Joe Padilla, a city attorney, said there are a few statutes in place prohibiting cities from requiring a “project having a certain amount of housing in its affordable housing units makeup,” and hindered the city from telling a developer the amount of affordable housing units allowed; regulations/prohibitions on rent control and more.
Littlefield wanted to know more information about what the rules, laws and options entail.
“The head of the multifamily association stated that none of the projects in Scottsdale, none of them qualify for their definition of a subsidized housing — we just don’t build it because what we have is too expensive so when we don’t have anything coming down the pike then that’s a real problem. We need to look at that too,” Littlefield said.
“Until this market cools down no one is going to bring that kind of housing to us so we’re going to have to try to find some for ourselves or figure out ways to do it if that is what we want to do.”
She said investors create a more unstable housing market when they come in and buy up property in mass to drive up prices.
“So this is the market we are living in right now. It is unstable, it’s artificially inflated and it doesn’t allow for the kind of housing units and housing criteria that we’re looking to provide for people. Will it change? Of course it will. Nothing is forever. Eventually it will burn itself out.
So what are our options and what could a subcommittee do if we establish it? That’s what I would like to make sure we have a very strong focus on where we want to go with this subcommittee and what we want them to look at and what our options are. We cannot subsidize housing nor can we build in competition with private enterprises,” Littlefield said.
Providing quality and quantity of homes in Scottsdale at a reasonable price, Littlefield suggested something like the co-op apartments, which are not expensive, and encouraged more “open minds to alternatives.”
Stock at every price point
Adequate housing supply is crucial for all people, Milhaven explained during the study session discussion.
Meanwhile, Councilwoman Tammy Caputi said she was thankful for the data shared in the presentation because she noticed a lot of misinformation in the community. She noted the importance of housing stock at multiple price points.
“I think that’s the key that we need to focus on here. We don’t have that in Scottsdale,” Caputi said of the variety of price tags.
She added having housing at different pricing points is mentioned in the city’s general plan, and other studies including Downtown 2.0.
However, Scottsdale still struggles with bringing that price variety to fruition, Caputi explained. She noted prices are being driven up by various factors, including land and material that makes it difficult to have housing at different price points.
“We’re going to hire a consultant; I hate to sound trite, but I mean this is market forces right? What’s the consultant going to tell us?” Caputi said. “We have very small supply and very large demand and that’s what keeps driving prices up, and up, and up and I think people really need to understand the economics here.”
‘Why the apartments?’
Appreciating more affordable housing, Councilwoman Solange Whitehead said 83% of workforce comes from outside the city, which contributes to local traffic congestion east and west of the 101. She also addressed people questioning why the interest in developing more apartments when there is no shortage of multi-family dwellings in the area.
Whitehead encouraged getting more creative in attracting long term rentals in the area.
Milhaven addressed the questions about more apartments as well.
“A lot of people have asked me ‘why the apartments?’ We have a lot of apartments. We’ve always had a lot of apartments in Scottsdale and the trends that I have seen that impacted it is that basically around the early 2000s many of those apartment complexes were converted to condominiums. In 2008, 2009, many of the purchasers of those condos were foreclosed upon. And, then in the 2009-10 timeframe, many of the condos were purchased by second homeowners,” Milhaven said.
While she wanted a comparison between then and now regarding the number of second homeowners in the area she was curious whether they comprised the majority of those who have taken many of the multifamily dwellings consisting of condos and apartments. She suggested “incentivising long-term rentals” of those properties.
Inviting more data, Milhaven recognized the complex issue and wanted to delve more into what the “problem” is to help identify a solution. She stated her appreciation in comments noting diversity issues in driving economic disparity.
“One of the reasons our taxes are so low is because we have a vibrant business community making sure that we’ve got housing options for employees makes all the sense in the world,” Milhaven said.
The local impact
Updating the council on the status of recommendations and how to proceed in efforts, Hollamby pointed out the benefits of affordable housing including such things as having more people from the community to live and work in the area; improving economic opportunities at all levels; contributing to “positive health outcomes”; increasing spending power in the community; and supporting economic growth.
“Living in the city where there is a variety of housing options close to work it provides amenities for recreational outlets for eating and entertainment is for many a utopia,” Hollamby said.
Hollamby stated how research showed a correlation between housing and health that overall improved one’s quality of life.
Other issues identified with having a shortage of affordable housing, Hollamby said, are:
Higher land costs/property values and rising cost of capital and construction
Scottsdale historically has expected a high build quality and a high level of amenities, which increase housing costs such as open space requirements, low density development, building setbacks, higher parking ratios, quality of building materials
Neighborhood expectation that nearby development will be of equal or increased value
Lagging wages not comparable with increased housing costs
Hollamby said steps being taken include:
Creating a comprehensive landlord strategy to maximize landlord participation in affordable housing efforts
Updating development forecasts
Completing a housing inventory and affordability analysis
Analysis and projections to provide comprehensive understanding of the situation
Staff preparing to facilitate an impactful Housing Affordability Working Group
City Council directing work to proceed
Delarita Ford Lead Reporter | Surprise @AzNewsmedia
Meet Delarita Delarita Ford originally joined Independent Newspapers Incorporated, now Independent Newsmedia, Inc. USA in 1997, as a general assignment reporter for the Delaware State News daily paper after starting her journalism career in Maryland in 1994, where she honed her skills by writing obituaries, covering community news from births to deaths, education to legislation and more. As a reporter, she has had the opportunity to cover sitting and former U.S. presidential visits in Baltimore, Delaware, and Arizona.
Community: One of the few seasoned journalists who still enjoys covering community events, she can be found with a reporter’s pad taking notes, her phone taking pictures while capturing life’s moments to memorialize them in print for the local newspapers and for the active-adult community where she lives. She maintains a presence with the Black media and the National Association of Black Journalists to encourage peers, socialize, and mentor younger writers.
Education: Life learner who learns from life. Aside from the collegiate education received, she got the best training from on-the-job experience with former editors who went through copy with a red pen and demanded the best writing for hard news and feature stories.
Random Fact: While a Delaware State News reporter, she could call then Sen. Joe Biden and his wife, Dr. Jill Biden, usually late at night if a quote or input was needed for varying topics, including legislation and education.
Hobbies: Adopt rescue dogs and give them a nice home. Continuously read and critique news stories from various platforms.
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