The cost of living: At least a third of residents pay more than they can afford for their homes. What next?

Behind older homes in the city’s 10th and Page neighborhood, a new student housing complex is nearing completion. Charlottesville is one of Virginia’s least affordable places to live, but making the market more equitable is a tall task. Photo: John Robinson Behind older homes in the city’s 10th and Page neighborhood, a new student housing complex is nearing completion. Charlottesville is one of Virginia’s least affordable places to live, but making the market more equitable is a tall task. Photo: John Robinson

Most charming. Most walkable. Healthiest. Number one place to retire. Charlottesville loves its accolades. But there’s one distinction it could do without: Least affordable.

The city’s high housing costs are not a new phenomenon, and neither are efforts to correct them. In 2010, the City Council adopted the goal of increasing its proportion of supported affordable housing—rented and owned units paid for with some kind of public support, from federally subsidized housing to homes bought with down payment assistance from the Charlottesville Housing Fund—from about 10 percent to 15 percent by 2025.

A progress check in the form of a federally mandated housing affordability report arrived this month, and the outlook is far from healthy. The Department of Housing and Urban Development requires jurisdictions around the country to assemble what’s called a Consolidated Plan for housing every five years, and the city adopted the most recent version of that plan on May 6. Its 70-plus pages of data and analysis show that Charlottesville has some of the lowest affordability of any Virginia municipality—and that there are no easy ways to change that.

Priced out

How do you know when a house—or a city—is an affordable place to live?

It’s not a simple assessment, because affordability depends not just on a fluid and changing market, but also on the income of the buyer or renter. According to the standard accepted by HUD, the golden number is 30: An affordable home is one that doesn’t require you to spend more than 30 percent of your income on it.

Housing Virginia, a Richmond-based affordable housing advocacy group, uses that standard to keep close tabs on the relative affordability of buying and renting in the Commonwealth’s cities and counties at various income levels. Its analysis, compiled from census data, helped inform the Thomas Jefferson Planning District Commission’s creation of Charlottesville’s FY13-18 Consolidated Plan.

One measure of affordability is housing cost burden—that is, the percentage of the population spending more than that crucial 30 percent of their paychecks on rent or a mortgage. Another is the Housing Affordability Index (HAI), which calculates the percent of household income required to afford the typical home in a given location.

Charlottesville has the unwelcome distinction of ranking near the top in the state on both measures.

In data compiled by Housing Virginia from 2005-2009, the city had a cost burden of 47.6 percent. In other words, nearly half of Charlottesville residents were paying more than they could afford for their homes. It was the second-highest cost burden in the state after Richmond and 38 percent higher than the current state average. More recent HUD data that zooms out to the metropolitan region, which includes Albemarle, Fluvanna, Greene, Louisa, and Nelson counties in addition to the city, puts that number at 33 percent—still among the highest for metro areas in the state.

The HAI numbers are also problematic, especially when adjusted to reflect the pressures on lower-income families. Charlottesville households earning 60 percent of the city median income—those bringing in $27,005, or about the average salary of a local preschool teacher—had to fork out 48.9 percent of their income to afford a median-priced home in 2012. That figure is higher than in any other Virginia municipality, save for two: Fredericksburg and Lexington.

The Consolidated Plan looks beyond raw data, and connects local high housing costs to issues of generational poverty, racial equity, and overall economic health. The city’s poorest residents face the biggest proportional cost burdens when it comes to housing, it shows. The affordability of renting —the default housing choice for lower-income residents who can’t put up the money for down payments—is being eroded. Minorities, especially African-Americans, shoulder significantly greater costs than whites. And as high costs near the metropolitan core persist, the city’s workforce is leaving, compelled to seek cheaper options in the county—even though ultimately, their savings are likely to be negated by higher transportation expenses.

The takeaway: Market forces alone aren’t doing enough to make Charlottesville affordable for the people who live and work here. And the problem could get worse, according to the TJPDC’s analysis, as nearly 1,000 units—almost half the supported affordable housing in the city—could be lost in the next 15 years without significant improvements and outside investment.

Charlottesville has to push back, said City Councilor Dede Smith, who thinks the Consolidated Plan’s time in the Council spotlight was lamentably short. “Substandard housing is creating a multiplier economic burden, because of the health issues and education issues that come with concentrated poverty,” she said.

And when people reach the point where they can’t maintain their homes, sell off, and move on, the neighborhoods they leave behind are stripped of their cultural importance. It might not be as noticeable or as dramatic as the razing of Vinegar Hill in the 1960s, but the result is similar.

“What we’re losing is our history,” she said.