Thursday, May 16, 2019 / by Juan Grimaldo
(Image: X Social Communities)
Groundbreaking is scheduled for May 16 for X Phoenix in downtown Phoenix, one of 235 apartment communities either under construction, planned or in the pipeline around metro Phoenix.
Linda Fritz-Salazar, associate broker and senior partner for Kasten Long Commercial Group, said she uses affordability definitions from Yardi Matrix, a research company she uses for information on multifamily properties with more than 50 units.
Affordable properties have two conditions in common: Some form of government subsidy attached to property tax advantages or favorable financing; and households must meet certain income standards below the area median household income, Fritz-Salazar said.
The term "affordable," as it applies to apartment communities, imposes restrictions that low-income households (below the median metropolitan area household income) must occupy a part or all of a property. The income determining a resident's eligibility for meeting low-income definitions varies by household size and from property to property.
Property-to-property variances reflect guideline variances imposed from program to program or within the same program based on timing of when affordable tax incentives were authorized.
Fully affordable apartment communities typically serve very low income, economically struggling households, with rents subsidized in some form by a governmental agency — either through direct household subsidy or rent-regulated maximums to qualifying households, Fritz-Salazar said.
The subsidized property typically is funded through additional property-related government incentives — tax credit or bond funded — strictly offering rentals to very low-income households. These fully affordable properties typically include all units in the property.
Partially affordable properties are where only a percentage or certain number of units in a property fall under the "affordable" category, Fritz-Salazar said.
Generally, in the U.S., the term "affordable housing" is used to describe housing, rental or owner-occupied, that is affordable no matter what one's income is, she said.
The U.S. government regards housing costs at or below 30% of one's income to be affordable, Fritz-Salazar said.
Kasten Long also included in its list a hybrid single-family rental product being developed by Christopher Todd Communities. It's not a traditional apartment community, which usually has several stories with shared walls between tenants. These properties are detached, single-family homes with their own backyards, but each of which is about the size of apartment units available for rent around the same price as higher-end apartments.