Cohousing-L Mailing List: The cost of housing, and therefore cohousing

[Chris ScottHanson (chris]

Housing costs money.  Cohousing is no different.

I have been an advocate of affordable housing since the late '70s, and 
the issues have not changed, at all.  (in my comments below, co/housing 
= cohousing or housing, either one)

SIZE FACTOR - How much space to you really need?
The largest factor in the cost of housing is the size.  How much house 
to you need?  How much do you want?  And how much can you afford?  
These questions must be answered and then reconciled, honestly, to 
achieve affordable housing.  In the US, the average person lives in 
something like 450 sf of space, per person. (This a an estimate on my 
part from my experience, and subject to verification with broader data. 
 Can anyone contribute an accurate number here.)  In the rest of the 
world, I understand that this average is something like 173 sf per 
person.

Example -  In Vancouver BC, during the mid-90's the hottest housing 
product was the 350 sf one bedroom unit in a downtown high rise.  
Thousands of these units sold to happy customers, normally professional 
couples from HK who where moving to Canada.

HIGH DEMAND LOCATIONS
New construction costs more money in places of high demand for housing, 
place where lots of people would like to live.  Boston, NY and San 
Francisco come to mind.  The RS Means Construction Cost Index indicates 
that the cost of construction in NYC is about 35%  above the national 
average, in Boston costs are about 15% above the national average, in 
Atlanta they are about 10% below the national average, and in Charlotte 
they are about 25%  BELOW the national average.

LAND FACTOR, and LOCATION
The land factor, while not as big a factor as some might think, is a 
factor in the cost of co/housing.  It generally runs about 15% of the 
cost of new co/housing, but can run all the way from less than 10% to 
as much as 40% or more in the bigger, high demand cities.  At WInslow 
it was 11.5% and in Jamaica Plain it will end up being about 26%.

Land that is on the existing utility grid is less expensive to develop 
than land that is not.  Cheaper land in the country can be very costly 
to develop, and operational costs go up as well.  (more cars required, 
etc.)

OPERATIONAL COSTS
The cost of new construction is mitigated to some degree by the 
potential savings in operating costs.  Higher energy efficiency is the 
most obvious factor.  However, one should not overlook the cost of 
owning a car.  I understand that a car costs an average of about $500 
per month to own.  If you live where you need fewer cars, you can 
obviously afford more house.  Transit Oriented Development is an 
important part of the environmental movement for this reason.

RENT OR OWN
Rental co/housing is normally cheaper in the short run than ownership 
co/housing, but this is only true in the very short run.  Taxes and 
interest deductions make it cheaper to own housing than to rent if you 
are going to stay in one place for any length of time.  The hurdle to 
ownership is of course the savings necessary for a down payment.

CUSTOM vs. PRODUCTION CO/HOUSING
Custom, one off, personalized co/housing is more costly than production 
co/housing.  Imagine the cost of a custom car, or a custom made dining 
room table.  Its the same thing with housing.  Let me build you 
production housing and I can build it today at a cost of approximately 
$65 per square foot (building construction only) adjusting that number 
by the Construction Cost Index for location.

SELF HELP and SWEAT EQUITY
Its counter-intuitive, but it actually does cost more to do it 
yourself, 95% of the time.

CHOICE
The solution to the affordable housing issue is about making choices.  
If you want to live in a 1200 sf unit in Boston, it will cost you about 
$350,000 in a not-for-profit cohousing project in the JP neighborhood, 
or about $550,000 in a high demand location like Davis Square. (The 
latter project is being built by a developer who is making a profit.)  
In other parts of the country, I can build you that same 1200 sf unit 
today as production housing for well under $200,000 if you can find a 
job there, and if you are willing to live there.

In Boston, you can live in a new cohousing home today for $200,000 if 
you are willing to limit yourself to 546 sf.  In Charlotte, NC, a small 
production unit in a large (theoretical) project of 350 square feet 
units (large enough for two people for most of the rest of the world) 
will run you about $35,000.

Its about choice, in my opinion.  My first cohousing home cost me 
$58,000 and it was just under 500 sf.

I hope this helps with perspective.

Chris ScottHanson

On Nov 16, 2004, at 8:00 AM, Fred H Olson wrote:

> Stepping our of my list manager role...
>
> While most of his points are way off, one is close enough to warrant
> comment.
>
> > 2) cohousing in america is elitist - originally an idea from denmark,
> > the american version of cohousing is only available to the top 10% of
> > income earners in america - methodically excluding people of color and
> > the homeless.
>
> The cost of cohousing is a problem.  While there are some opportunities
> for people of limited income, I think they are relatively few.  Of 
> course
> the cost of housing in the US is a problem generally. I don't know what
> percentage of the US population could afford to spend 30% of it's 
> income
> to live in the median priced cohousing unit, but I suspect it is higher
> than 10%.  Anyone capable of coming up with this (or similar) 
> statistic?
> Raines, could we come up with the median price of a cohousing unit in
> the US?
>
> I encourage people to keep posting examples of relatively affordable
> cohousing...