Miami-Dade would increase the cap on prices that affordable-housing developers can charge for homes built using county money or land, with administrators saying current price limits are outdated for the market.
Legislation before county commissioners Tuesday would lift the current cap of $205,000 for homes built on county land, and allow developers to sell them for up to $235,000. Changes to a related program would let projects with low-interest county loans sell for as much as $310,000, more than a 50 percent increase from the existing $205,000 cap.
Miami-Dade’s affordable-housing program provides loans and land for developers who agree to price caps and sales to buyers who earn below a threshold set by the county. The new $310,000 cap would apply to projects built with cash subsidies and would be lower for buyers who earn less.
“It expands opportunity,” said Clarence Brown, director of the county’s Community Development division. “It doesn’t limit opportunity.”
The county’s Housing Department recently backed off higher cap increases after meeting resistance from commissioners leery of raising prices on buyers. Improving access to affordable housing is already a campaign plank for the one commissioner running for mayor, Daniella Levine Cava, and has been a main issue for others planning a run to succeed Carlos Gimenez when he leaves office in 2020.
“We’re concerned about doing it all at once,” Levine Cava said. She said the higher price caps will help open up the program to families who make more than the typical affordable-housing buyer but still struggle in the Miami market. But she said the current proposal includes too many price increases, and that she would propose a longer schedule that would let the county boost caps as real estate prices increase.
She said the county could make it easier for developers by speeding the time it takes to get an affordable-housing project approved. “Time is money,” she said.
In justifying the community development department’s plan in a memo to commissioners, Gimenez cited new tariffs on building materials that are pushing up costs as well as rising real estate prices in Miami. “The housing market has changed significantly,” Gimenez wrote, “and the cost of construction has increased.”
Miami-Dade set the $205,000 caps in 2007 and 2008. The Miami area routinely tops studies showing large gaps between real estate prices and what residents can afford. A 2017 study found that, among all major metropolitan areas, Miami-Dade had the largest portion of renters — nearly two-thirds — paying more than 30 percent of their income on housing costs.
The county’s affordable-housing programs have also been criticized for not doing much to address the problem. The Miami-Dade program offering developers free land to build houses for buyers making up to 140 percent of the area’s median income produced only 27 homes in 2017, according to a report submitted last year.
The Housing Department contends that current price caps are too divorced from land and development costs to encourage developers to participate in the affordable-housing program. That’s particularly true when it comes to property outside of extremely low-income neighborhoods, said Arden Shank, interim director of the South Florida Community Development Foundation.
“They tend to be pretty small houses. And they tend to be in the most problematic neighborhoods where property values are lowest,” Shank said.