Housing in Boulder County — and across Colorado — is expensive. But affordable homes are more than a fantasy.
Even with myriad solutions on the table, and many people eager and able to make change, closing the affordability gap is proving to be a monumental task
Originally published at The Colorado Sun on May 27, 2021.
This story was produced as a result of the TRENDS Reporting Fellowship at Community Foundation Boulder County.
Carly Hillmer purchased her first home in March. Her “gorgeous little house,” as she calls it, has two bedrooms and one and a half bathrooms, plus a small fenced yard for her dog to run around. It cost $225,000.
That’s not a typo.
Hillmer bought her house in Longmont through a community land trust, which separates the plot of land from the house itself. The model is not new, but it’s one of many options communities have been leaning on during the coronavirus pandemic as the housing affordability crisis in Colorado reaches a fever pitch.
Hillmer knows she is one of the lucky few, and that there aren’t nearly enough homes available at a price that many people in her network can afford. While she lives just 10 minutes from Northridge Elementary School, where she teaches 4th grade, some colleagues live as far away as Loveland. Hillmer’s friends who have been renting in Boulder are finding they have to move to nearby towns or further when they decide to buy property. And students at her school, most of whom are from low income families of color, often come and go based on housing costs.
“It’s heartbreaking to watch,” Hillmer said. “And I don’t know if it’s gonna stop.”
The result: people who can’t afford the area are forced to leave. Diversity, character and community ties all weaken.
High housing costs are destabilizing and homogenizing diverse communities in Boulder County and beyond even faster now than before the coronavirus pandemic hit a year and a half ago. Even with myriad solutions on the table, and many people eager and able to make change, closing the affordability gap is proving to be a monumental task.
Not enough supply to meet demand
Since the coronavirus pandemic hit Colorado, many areas of the state have found themselves struggling to maintain a diverse stock of housing that allows people from all socioeconomic levels to live near their jobs. Boulder County has long been attempting to address the affordability of housing for both renters and owners, a situation worsened by low supply and high demand.
Statewide, the average price of a home was $661,551 in April, up 36.4% in the past year. Boulder County is on the expensive end of the spectrum, with the median price of a single-family home in Boulder topping $1.5 million in April and $569,275 in Longmont.
Meanwhile, stagnant wages led more households to spend a higher percentage of their income on housing. Roughly 58% of Boulder County renters are “cost-burdened,” meaning they put more than 30% of their income toward rent, according to a 2018 report from the nonprofit Community Foundation Boulder County. The biennial report, which gets its data from sources like the American Community Survey, found that between 2007 and 2017, just one housing unit was built for every 3.5 jobs added in the county.
How affordability is defined varies from place to place and program to program. The pricing of affordable units often reflects the desired 30% or less of someone’s income put toward housing. But since it’s based on area median income, or AMI, the specific price that makes, say, a 1-bedroom 1-bath apartment affordable will vary by region. A maximum income is set for most units, typically 60% to 80% AMI, though it can be as high as 120% for some home ownership programs.
One person seeking an affordable rental unit in the city of Boulder in 2020, which limits affordable units to 30% to 80% of AMI, could make between $24,180 and $64,480 annually. The area median income for an individual in Boulder County in 2021 is estimated at $80,600, according to the Colorado Housing and Finance Authority.
Lenora Cooper started out living in so-called market rate housing when she moved to Boulder, in 1991. But she became disabled and cannot work a traditional job. She looked into affordable housing options and ended up receiving a housing voucher.
The Housing Choice voucher program from the U.S. Housing and Urban Development, also known as Section 8 vouchers, helps cover the cost of a home for low income, elderly and disabled people so they pay less than 30% of their monthly income toward rent. Some vouchers are designated as “open market,” meaning they can be used for any unit that meets the program requirements, not just subsidized housing projects. Cooper received a voucher in 1998, almost a year after applying.
“Without that I would be on the streets or possibly dead,” Cooper said. “And I don’t say that to be dramatic. I say that because it’s a reality.”
Cooper’s experience is how the system is supposed to work, she says, but it rarely plays out that smoothly. More than 30,000 Colorado households use vouchers, according to HUD, with about 2,500 in the Boulder area. But there are thousands more people on waitlists across the state, according to the Colorado Department of Local Affairs, and many of those lists are backlogged for multiple years and aren’t accepting new applicants. For reference, Colorado is short an estimated 220,000 units for low-income renters, according to DOLA.
Cooper works with local groups, including as a member of the Participant Advisory Committee for the nonprofit Emergency Family Assistance Association. She says the pandemic has further exacerbated the affordability crisis, especially for those trying to afford housing near where they work.
Still, Cooper notes, there are good things happening. Federal support is on its way through the American Rescue Plan, which is sending an additional 1,023 vouchers to Colorado housing authorities. Sixty-nine of those are for Boulder County housing providers specifically, while another 368 will be distributed through the state Division of Housing. And a bipartisan bill to improve incentives for affordable housing development was introduced in the U.S. Senate on May 20.
Even as the divide between the haves and have-nots continues to grow, Cooper says she feels the community is coming to grips with how severe its housing crisis has become. Boulder’s recently adopted Racial Equity Plan explicitly calls out housing strategies and local circumstances that have made it harder for communities of color to thrive in the city. The plan notes multiple interventions are needed — including adding more affordable housing — to encourage racial and socioeconomic diversity.
“I just have faith that with enough drips in the bucket, eventually the bucket will become full and these issues will be addressed and fixed,” Cooper said.
Local affordability efforts feel the crunch
Boulder has added 501 affordable rental units since 2017 and will hit 1,601 units later this summer, according to Boulder Housing Partners, the city’s housing authority and second-largest residential landlord behind the University of Colorado.
But the increase in supply is still far from meeting demand. Executive Director Jeremy Durham points to the rise in work-from-anywhere employment during the pandemic, which is putting significant strain on housing markets nationwide. Though many of the people moving to the area wouldn’t qualify for affordable housing, the high demand for housing in general means availability is dwindling, pushing up prices. Even before the pandemic, Durham estimated that about a third of the city’s workforce could qualify for affordable housing, and BHP is “nowhere near housing a third of the city.”
“That pressure has created just such a tremendous gap between what a lot of the local workforce can afford, and what homes rent for, and certainly what homes sell for,” Durham said. “So we’re certainly losing a diversity of incomes in the community over time. And it appears to be, and it feels like, a dynamic that is escalating in nature.”
Building new homes or renovating existing ones has also gotten more expensive during the pandemic. A national shortage in lumber is adding an average of $35,000 to the cost of a new home. Limits on land use and building height in some cities, including Boulder, can also create a squeeze that raises property costs. More than a fifth of the total acreage of Boulder County is open space protected from development.
The crunch also exists in cities like Longmont, which doesn’t restrict its residential growth to 1% a year like Boulder does, and has long had lower housing prices. The city works with Boulder and other cities, including Louisville and Lafayette, in a regional collaboration to try and mitigate the area’s housing woes. The goal: at least 12% of all housing units in the county — an estimated 18,000 units — will be designated as permanently affordable by 2035. About 4,500 of the 12,000 homes needed to reach that benchmark will be newly built, while the other 7,500 will be existing properties that are acquired.
Even if that goal is met, there will still be many who struggle to pay for what is ultimately a basic need, said Kathy Fedler, manager of Longmont’s Housing and Community Investments Division.
“The bottom line is that you have to have housing, so you pay what you have to pay,” Fedler said. “And then there’s other things that you can’t afford in order to pay for your housing.”
A old housing model gets a new look
The community land trust model is quickly emerging as a potential way to address unaffordable home prices.
Rather than selling a residence with the land it sits upon, as happens with traditional home ownership, a community land trust separates the two. The model emerged in the American South during the civil rights movement. An organization owns the land and sells the residences there, leasing the land to owners for decades at a time. When someone is ready to sell their home, they are required to keep it at an affordable price, but can often still reap a small profit margin based on how well the residence’s value has grown over time.
This arrangement not only makes the house affordable to purchase for the first owner, it passes along that affordability to future owners. It’s also a more affordable system for municipalities, since their investment only happens the first time a residence is purchased, rather than offering recurring subsidies as can happen for other affordable housing programs.
It’s a system that balances the needs of an individual with the needs of a community, according to Elevation Community Land Trust President and CEO Stefka Fanchi, which currently partners with five municipalities, including Boulder County.
“Many people will choose not to be a homeowner and that is fine,” Fanchi said. “What is not fine is to not have the opportunity to stabilize your housing payment, your family situation, your ability to build wealth, to leave something to your children. And that’s really what we’re trying to accomplish, to make sure that no one is shut out from those opportunities and that everyone has a choice.”
The average purchase price of an Elevation trust home in 2020 was $216,000, less than half the average price of $540,000 for market-rate homes in those neighborhoods. Their homeowners are diverse: By the end of 2020, 59% were people of color, and 25% of owners were women who headed up the household, more than twice the national average of 12%.
Hillmer, the first-time Longmont homeowner, bought her house through the trust after realizing that her teacher’s salary could qualify her as a low-income earner, and the monthly mortgage would be significantly less than rent.
Hillmer said she doesn’t think she will stay in the little house forever. But she compares the purchase to putting money in a savings account rather than another person’s pocket.
“I love that I own something,” Hillmer said.
While Colorado has had land trusts for decades, more are starting each year. In north Denver, the community-led GES Coalition sees Tierra Colectiva as one way to keep some of Denver’s oldest neighborhoods, Globeville and Elyria-Swansea, intact. The program is currently incubated within Colorado Community Land Trust.
The project runs counter to what the neighborhoods have undergone in recent years. Infrastructure changes like the I-70 redesign and National Western Center redevelopment are combining with increased gentrification across Denver to push out longtime residents and families.
“Our hope is that the land can play a role in figuring out how to both stabilize and build the health in the community,” said GES Coalition Director Nola Miguel.
Alma Urbano was not planning to buy a home, least of all during the pandemic housing market, until she realized she might qualify for a place through Tierra Colectiva. Urbano’s parents had been renting a place in GES that was slowly deteriorating, and neither of them were able to work much during the pandemic. It made sense for the three of them to move back in together, with Urbano taking the lead to purchase her house in Swansea.
“It’s definitely very magical in some way, I think, miraculous,” Urbano said of both the stability and flexibility that homeownership has given her.
Urbano and her mother have been heavily involved as a community organizer to create Tierra Colectiva.
“It feels very much more grounded and secure than if someone, say another community land trust, wanted to build homes,” Urbano said.
Even though it took four years to get the first five units online through a combination of rehabbing old properties and building new ones, director Miguel says she feels like the coalition is on a roll. But the current housing market conditions aren’t making things easier. It cost the coalition about $200,000 each for the first few homes, but Miguel says now it’s difficult to find anything cheaper than about $350,000. That means there needs to be more outside government and philanthropic funding, Miguel said, to bridge the gap between what the organization paid for the home and the price at which they sell it.
Eventually Tierra Colectiva would like to offer 300 homes, Miguel says, perhaps to a wider income range as well. She said community land trusts are not the only solution for the housing crisis, but they are just as important as affordable housing authorities, especially for their community-led approach. Two-thirds of Tierra Colectiva’s 19-member board members own land trust homes or are their neighbors, and the other third are experts chosen by the rest of the board.
“Our bottom line is what’s the best for the community,” Miguel said. “The history of Globeville Elyria-Swansea, it’s just been one thing after another in different forms. And we’re sick of the crumbs.”
Affordable housing as key to a “well rounded community”
When Eliberto and Abbey Mendoza moved to Longmont in 2007, they knew they wanted to buy a place, but they couldn’t afford a market-rate home. They applied to Habitat For Humanity and got to help build a three bed, one-and-a-half bath home, where they moved in 2011. Had they not gotten the Habitat home, Eliberto says his family would probably still be renting.
“It just provided a lot more opportunity and options for us,” said Eliberto Mendoza, who now works as project coordinator for the city of Longmont’s Community Services department. “And it provided a place for the kids to grow up and that’s their house. And that’s important as well.”
Habitat makes units affordable for purchase through a number of means, including no-interest mortgages. Each residence has deed restrictions that keep it permanently affordable while still allowing owners to make some profit if they decide to sell. Owners contribute “sweat equity” to their homes, working alongside volunteers to build the dwelling. Most Habitat mortgages in the area are under $1,000 a month, far lower than the average monthly rent for a two-bedroom apartment of $1,852 in Boulder or $1,411 in Longmont.
Habitat For Humanity of the St. Vrain Valley has built over 100 homes in the area in the 30 years since it was started. Executive Director Dave Emerson said in a county with about 300,000 people, it will take more than a couple hundred houses to ease the affordability crisis, but he says it’s one of many necessary pieces of the puzzle.
“I think people are realizing there’s a lot of problems that we have to get really creative on really quickly,” Emerson said. “I’m not going to say that I know what the right answer is. I don’t think most people know. And there’s probably not one right answer.”
As someone whose day job focuses on finding housing solutions, Mendoza sees the crisis both on a personal scale as well as the larger regional landscape. Now with three kids who are all growing up quickly, the house is getting a bit cramped, so they’re renovating to make it work. And as chaotic as the current housing market is, it may help the family get a higher return on their investment when they decide it’s time to move.
Whether they would be able to stay local is unclear. Mendoza says prices in Longmont, which has long been Boulder’s more affordable neighbor, are now starting to edge out middle income people, and he’s worried about how that will change the area’s character.
“How can we not afford to help invest in housing for everyone so that we can be a well-rounded community?” he said.
That’s the question many regions across Colorado are asking. Mobile home parks in Boulder and beyond have been considering communal ownership models to counteract predatory landlords. The mountain town of Frisco may declare a formal state of emergency to navigate its housing crisis.
Some rent and mortgage assistance funds have emerged to address short term needs. About 525,000 Colorado households are low- or moderate-income renters, according to 2015 data from DOLA. Roughly 60% of those households spend more than 30% of their income on rent. And almost one-third are severely cost burdened, putting more than half of their income toward housing. Many are concerned what will happen after June 30 when the federal eviction ban expires.
Some bills in the legislature this year may help improve the situation in the long term. Gov. Jared Polis signed House Bill 1019 into law on May 10, opening new avenues for factory-built homes to proliferate, and House Bill 1117, which gives local governments more authority to increase affordable housing stock, is awaiting his signature. Another measure, House Bill 1271, would offer grants to local communities seeking “innovative solutions” to address the dearth of affordable housing.
But the coronavirus pandemic and its many ripple effects have amplified issues in Colorado’s housing market that have been simmering for a long time, says Alison George, Division of Housing director at DOLA. And it will take a mighty effort to change the tide.
“We’ve been in a reactive mode for so long, and the pandemic has really shown us that we need to be proactive and thoughtful about how we think about the growth of Colorado in the future,” George said. “It’s going to happen one way or another.”