Multifamily Housing: Sustainable Development in Efficient, Walkable Communities

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1 Multifamily Housing: Sustainable Development in Efficient, Walkable Communities by the Greater Charlotte Apartment Association Multifamily rental housing is a critical piece of the housing market in the Charlotte, NC region for reasons of affordability, lifestyle, and sound land use planning. The benefits of multifamily development include: Fewer infrastructure requirements than traditional Charlotte-area low-density suburbs Shorter roads and walkable communities, which decrease vehicle miles traveled, thus reducing carbon emissions Efficient land use Residential populations large enough to support neighborhood retail and public transportation The creation of open, public space Residential options for an increasing number of single-person and empty-nester households

2 Introduction Demographic shifts, high infrastructure and construction costs, population growth, the long-term outlook for energy, environmental/ air quality concerns, and economic challenges make the case for more compact development compelling, despite some lingering public opposition to higher density. The debate in the Charlotte region is no longer whether to build compactly to accommodate more residents, but rather where to increase density and how to best encourage, facilitate, plan, and design new compact development. This brochure has been written for land use professionals in rapidly-growing communities in the Charlotte region. The intended audience includes community leaders, planners, developers, architects, and elected officials who wish to create and enact regulations that will encourage compact development in their communities. Although the arguments for compact mixed-use development are convincing, the reality is that many people oppose almost all new development, and that opposition often increases with the density of the proposal (and the proximity to the opponents property). Support for compact development will only be gained if an educated public fully understands the effect of population growth and the consequences, challenges, and trade-offs inherent in land use decisions. Apartments are often characterized by their efficient locations in well-planned, dense communities that are linked, where possible, to transit. Locating apartments in welldesigned compact communities achieves a number of key objectives which are outlined in the following pages.

3 Importance in the Marketplace Since 2000, the Charlotte metro area has enjoyed strong economic growth fueled by a favorable business climate and by an expanding job base (+10%). Equally critical to the region s appeal during this time has been its stock of affordable housing, which includes both owner-occupied homes and rental units. The importance of this mix is underscored by U.S. census data (2006) which shows that approximately 40% of households rent in Charlotte. While homeownership has long been favored and promoted by national housing policies, the recent mortgage crisis and resulting widespread foreclosure issues have demonstrated that a more balanced approach would better serve the country and our local area. Rental housing fulfils a critical need in the Charlotte community by providing shelter for teachers, firefighters, policemen, retirees and those new to our area. And while affordability is typically a substantial benefit, convenience, mobility and living close to work are very often reasons why people choose to rent. This variety in housing choice - given the high percentage of renters - is an important feature of the greater Charlotte area and plays a key role in keeping our community vibrant and attractive to businesses and to current and future residents. As such, we must ensure that the importance and advantages of rental housing are well understood by community leaders and that this vital resource is valued and protected. The graph below illustrates the actual and projected population growth in the Charlotte region between 2000 and ,200,000 1,000, , , , ,000 0 Source: Charlotte Regional Partnership

4 Efficient Land Use & Smart Growth At a time when local governments are strained to provide community services and infrastructure, apartments and multifamily housing offer a key part of the solution. Higher density development requires fewer miles of roads, curbs, sidewalks, and water and sewer lines. In addition, municipal services such as solid waste collection can be delivered in a tighter area of geography with greater efficiency and lower cost. The Urban Land Institute states that the cost of providing public facilities to single-family development with five units per acre can be almost twice that of multifamily apartments with 30 units per acre. The higher density of multifamily housing encourages adjacent retail opportunities, creating for walkable, service-oriented communities. In Mecklenburg County, Phillips Place and Birkdale Village serve as prime examples where successful multifamily housing is a key ingredient of vibrant mixed-use neighborhoods. As both of the noted developments demonstrate, compact developments with efficient land use create significant community open space and are inherently sustainable Public Capital Costs by Housing Density Source: A Guide to Impact Fees and Housing Affordability, Island Press, Dwelling Units (DU) per Acre

5 Traffic & Transit Benefits Although traffic generation is frequently cited as a reason for opposing apartments, it is clear that the sustainable development initiatives of apartments reduce vehicle miles traveled. According to the Charlotte Department of Transportation (CDOT), apartments create 42% fewer vehicle trips per day per unit than single family homes. The number of vehicle trips and the average length of each trip substantially impact traffic congestion. Multifamily housing density can reduce the distance to work, shopping, and recreation, resulting in shorter average trip lengths, as well as fewer trips per day. Further, denser multifamily development closer to bus and rail public transit can lower carbon emissions. According to a 2008 study by the Clean Air Trust, Public transit (city buses, subways, light rail systems and commuter trains) usually produces fewer emissions per kilometer traveled than cars. Multifamily development is a sound planning practice and vital to the success of our region s investment 10 in mass transit. Urbanologist Hans Blumenfeld maintains that the appropriate 8 residential density for successful transit stations is 12 to 60 units 6 per acre, which corresponds to typical multifamily densities Source: City of Charlotte Department of Transportation No less important is the fact that residents prefer the convenience of transit-station housing. A 20-year study including multifamily development in San Francisco Bay area revealed that roughly five times as many apartments were built near rapid transit stations than freeway interchanges in the same submarket areas. Apartments in such locations are made more affordable by reducing the need for an automobile, the expense of which is a significant portion of a typical homebuyer or renter s income. Since the South Light Rail Transit Line began construction in Charlotte, parcels near its station areas have increasingly drawn interest from multifamily housing developers eager to satisfy consumer interest in vibrant, accessible neighborhoods. By late 2008, over 5,000 multi-housing dwellings were completed, under construction, or announced as planned starts along the Line from Uptown Charlotte to I-485 at South Boulevard. Additional starts are expected as the housing reaches a critical mass, ancillary services are supported, and more consumers choose an urban lifestyle. Both elected officials and city planners can use multifamily development as a valuable tool to combat the growing challenge of suburban sprawl. By encouraging higher levels of density in infill locations and along transit corridors, city leaders and planning staffs can meet our region s growing housing needs while also reducing the environmental impact of excessive sprawl. Multifamily housing is a logical and desirable use of land in proximity to employment centers and in areas of job growth. Providing affordable and convenient entry housing is an absolute necessity to an area s ability to attract employers and ensure the long-term success of our region.

6 Impact on Property Values One of the charges levied against new multifamily development is that it will adversely impact the value of surrounding property. However, according to a study by the National Association of Home Builders, locating apartments adjacent to single-family neighborhoods does not have a negative effect on house appreciation. Between 1997 and 2005, single-family detached homes located within 300 feet of multifamily structures appreciated at a slightly higher rate than homes that were not near multifamily building. (See graph below.) Whether empty nesters or young adults, apartment renters often choose apartment living as a means of evaluating a neighborhood before they make the financial commitment of homeownership. Apartments offer them flexibility in decision making, allowing them to experience such things as the local quality of life, work commute, and neighbor relationships that they may later consider before purchasing a home. Hence, a good mix of rental housing in a neighborhood helps to create a stable market for home sales. Further, academic studies have shown that many of the perceived differences between owners and renters are virtually nonexistent when adjusted for factors such as family size and demographics. In fact, research based on the University of Chicago s General Social Survey demonstrates that apartment residents are more socially engaged than homeowners and equally involved in community and religious organizations. Annual Appreciation Rates 15% 12% 9% 6% 3% all not near apartment buildings near apartment buildings Source: 2005 American Housing Survey, U.S. Census Bureau and HUD

7 Impact on Schools Public schools generally constitute the single largest expense for local governments, so it is important to understand how different housing types contribute to school enrollment in our community. According to a survey by Charlotte Mecklenburg Schools, the average single-family household creates 50% more school-age children (Pre-K/Elementary through High School) than the average apartment unit across Mecklenburg County s planning area. While this number fluctuates within this geography, it is not surprising that the number of children that reside in apartments is low given the historically stable typical resident profile of multifamily dwellers: adult individuals, adult roommates, married couples without children, some single-parent households, and so-called empty nesters. Married couples with young children or who plan to have children quite commonly opt out of their apartment for single family detached housing. Too frequently, multifamily rental housing is viewed as having a similar or even a more dramatic impact on school enrollment in the Charlotte area. As the CMS data supports, the opposite is, in fact, the case. Apartments Student Yield per Household in emerging areas of Mecklenburg County Single Family Homes Source: CMS Planning Services

8 Conclusion With housing as a key component of Charlotte-area communities, the mix of uses requires thoughtful consideration. Finding the right mix is crucial, and needs to include these key principles: The housing mix needs to reflect the entire community. Both proximity and affordability buttress the value of creating a compact community. The mix needs to include housing for all people of all incomes and in all stages of their lives. The forms of housing should be mixed rental and ownership, townhomes, small single-family detached, and multifamily of various sizes. As noted urban author Jane Jacobs wrote: In maintaining a vibrant city, it is especially important to have a great deal of diversity on the district level so that people can remain in their local area even as their housing needs, jobs, and lifestyles may change. Sources: Charlotte Department of Transportation. Land Development Rezoning and Traffic Impact Study Review Process. February, Charlotte-Mecklenburg Schools Planning Services Student Yield Factors. January, Clean Air Trust. Local Travel Emissions Haughey, Richard M. Higher Density Development: Myth and Fact. Urban Land Institute, National Association of Home Builders. Multifamily Market Outlook. October 17, Nelson, Arthur C., et al. A Guide to Impact Fees and Housing Affordability. Island Press, United States Census Bureau and U.S. Department of Housing and Urban Development. American Housing Survey The Greater Charlotte Apartment Association

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