30% of Income Cohousing [was Unit price and budget questions
From: Sharon Villines (sharonsharonvillines.com)
Date: Thu, 19 Nov 2020 14:00:55 -0800 (PST)
On Nov 18, 2020, at 8:35 PM, Toni Elliott <tonialiani [at] gmail.com> wrote:

> I'm involved in a very young, just-trying-to-get-off-the-ground community
> in Washington State, Puyallup CoHousing.

Congratulations on getting as far as this and for finding Cohousing-L so you 
can get information from a lot of experienced cohousers, including other 

> The first set of data we are looking for are regarding new or
> in-construction communities. We are trying to get some sort of idea on how
> affordable we can make our community (we want to make it available for as
> many people as possible).

Affordable is what I’ve been thinking about lately. I started a website where I 
am collecting information, just renamed: https://affordablecohousing.org

The About page has an explanation of why I changed from “sustainable” to 
“affordable” and took on the war to make “affordable” mean something. 


“Affordable" is applied to housing at all market prices. A $1 million house is 
affordable in a neighborhood of $10 million houses. In an area with an average 
home price of $400,000, affordable using HUD standards is $320,000.

This is not what most people think of when they think “affordable.” The 
standard that financial managers use for affordable is 30% of income for all 
housing costs, whether it is mortgage payments or rent. I’ve posted 
calculations of income to housing in the past but you can figure it out 
yourself. 30% of income for everything housing related, including utilities and 
maintenance. If a household can pay that, they are considered housing-stable. 
Lower income households often pay more but over 50% of income would be 
bordering on housing-insecure.

So a good guide for your area would be 30% of the median area income as a 
starting point. Then move down to the incomes of the people in your group or in 
the population that you want to target. 

One reason this is not easy is that banks won’t finance housing lower than 
their own standards of what they consider desirable. And town planning boards 
restrict multi-household communities, houses below a minimum size (-1,200 SF), 
and lots smaller than a minimum size. And they enforce them.

This is beginning to change but it is taking lawsuits and community activism to 
change it. It will likely be done one city at a time. So you have to look at 
zoning requirements and construction requirements. 

The things that raise the price of houses are the typical things that middle 
and middle-upper households expect, particularly if they are building the homes 

1. Bathrooms and kitchens are the most expensive per SF initially, but total SF 
will be expensive from day to day for heating and cooling and maintenance. A 
three-bedroom house has more roof than a one-bedroom house. More walls, more  
light fixtures, more sprinkler heads, etc. Down the line the larger total space 
is more expensive.

2. Minimum requirements for a kitchen may be the ability to cook and store 
food, running water, and waste disposal. But dishwashers, large refrigerators, 
stone sinks and countertops, etc., are often considered the minimum in a new or 
rehabbed house. A stainless steel sink can be had for $100 and a quartz, 
marble, granite, or slate kitchen sink for $1000+. Multiply the difference for 
a 30 unit cohousing community and the range might be from $300 to 3,000+. 
Composites are less expensive but have a shorter life.

3. Flooring in bathrooms is usually ceramic tile because it tolerates water 
best. Ceramic tile can be from 20-40 cents a SF for plain white. Traffic master 
tan, 50 cents to $5.00+ for more decorative tiles. A  5 x 10SF floor, just for 
tiles, Might cost $15 to $250. For 30 bathrooms, $450 to $7500. And if larger 
units have 2 baths or 1 1/2 baths, it costs that much more.

4. Wall board, electrical wiring and outlets, duct work, number of windows, 
flooring, sprinkler heads, stairways, closet doors — all these things increase 
with size. And with quality. Small unit may have 5-7 sprinkler heads for a 
2-bedroom and, 21-27 for a 3 bedroom with a den and a basement. Those all have 
to be inspected and replaced from time to time. An ongoing cost that is much 
greater for large units.

It’s very hard to keep costs low enough for a household income of $50,000, 
approx. the median wage in the US. Half earn less than that. A household 
earning $10 an hour will have $6240 for housing costs using the accepted 
formula for being housing-secure.

It’s very hard for people who have higher incomes to hold the line so lower 
income people can afford units. I question how large the range of SF costs can 
be. The average cost per SF is 154 SF but that is an average many parts of the 
US are higher than  that. The average size of newly constructed homes is 2,776 
SF and costs $427,893 to build. Condominiums average 1200 SF, or 20’x30’. 

Homeowners who want the amenities and finishes that are normally expected in 
the $500,000 house market, how can other units be kept to prices that 
low-income households can afford. 

Customization is very expensive. If you have watched a multi-unit residential 
building being built, you see construction workers, electricians, plumbers, 
etc., all running around at the same time trying to remember if this is the 
unit that gets green tile and 2 sinks or the one with a bidet and red tile. The 
building is still a wood plank structure with no numbers when some workers have 
to begin their work. Which space is the kitchen and where is the bathroom?

If all the floor tiles are the same and all the sinks the same size, the job 
can be done much more quickly, with less supervision, and fewer mistakes that 
have to be corrected. I once moved into an apartment in a complex of 7 
buildings. Our building was the only one finished. The other apartments were 
for the construction workers who travelled all over the country to build for 
this contractor. In the evenings they invited us in to hang with them. The 
stories they told were horrendous. Of all the mistakes they had made and why. 
And how many more construction days it took to correct them. That’s why only 
our building had been finished — we had signed a lease a year before. They were 
a bit behind. 

For budget for operating the building, I recommend finding a building manager 
in the area who manages a building the size of yours and ask what maintenance 
costs are. Even if they don’t give you figures, they will be able to advise you 
on which systems are hardest to maintain, etc. There are professional managers 
associations, condo management companies, etc. One may not be willing to talk 
to you but another one will. People who like their work love to talk about it. 
That’s the person you need to find.

Many a day I’ve wished we had had a maintenance person look at our construction 
plans and tell us how much harder this or that would be. Like fixtures on a 2 
story ceiling that need new light bulbs. Interior surfaces that are 
unreachable. They look wonderful unless you are on the maintenance team.

Thinking in terms of 30% of income, might be the best target to ensure building 
income diversity in the community. I think it would be easier to limit the top 
cost to the average income or it will be too hard to keep the costs down. 

Sharon Villines
Takoma Village Cohousing, Washington DC

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