Housing Complex

Inclusionary Zoning Finally Takes Effect

"Inclusionary Zoning" is a terrible bit of government jargon that makes you want to bury your head. But don't think of it like that. Embrace "inclusionary zoning," and remember its name. It could help you—yes you mid-level non-profit worker, DCPS teacher and thrifty secretary—land your first condo in a building full of lawyers, consultants, and lobbyists (sorry for the default stereotypical rich people careers).

After years of discussion, debate, and moaning about missed deadlines, inclusionary zoning went into effect last week. Here's what it is in a nutshell (according to the Washington Examiner)

The law requires housing developments consisting of more than 10 units to set aside between 8 and 10 percent to be affordable to residents with low and moderate incomes.The policy, called "inclusionary zoning," is practiced by hundreds of jurisdictions nationwide, including Montgomery, Fairfax and Arlington counties locally.

"Low to moderate incomes" is not exactly correct though.  As I've written about in the past, the city has long forced developers to sell some condos at affordable prices. One woman who recently purchased a below market rate condo on 14th Street paid $234,000 for a one-bedroom unit. She met the requirement of making between 50 and 80 percent of the area median income.

Before inclusionary zoning, which went into effect on Friday,  there was no clear framework about how to market those "inexpensive" units. Under the new rules, there should be more transparency:*

Under the new rules—which are supposed go into effect by early fall—the Department of Housing and Community Development (DHCD) will review all buyers who register with the agency to see if they meet “certain income and household-size eligibility requirements.”

Then DHCD will notify registered people when lotteries occur. In addition, developers will be required to list their affordable units on a city Web site, dchousingsearch.org. The city will also “contract with a community-based organization to assist with outreach, housing counseling/education,” Madigan writes.

*This is from my article "The City Forces Developers to Sell Cheap Condos. But Can You Find Them?"

  • DC Native

    Inclusionary Zoning is great for the most part, but for residents who "purchase" a unit, they're screwed. 20 year restrictions on resale is absurd. What happens to this low or moderate person when they need to sell their unit? They walk away with nothing and they will be forced to become renters again. Typically of this Administration, all show, no substance. Some plan...

  • Sir Spicious

    I don't understand the idea that everyone deserves to own a home. For decades, only about half the population lived in a home that they owned. The push to increase that number led to the unintended consequences that we are now working through in our economy. There's no shame in renting, and continuing to push the idea that the only way to build wealth is through home ownership is damaging.

  • Mrs. D

    Dear Sir (I just had to start with that), the problem you speak of has created a vicious cycle. Pushing people to buy, buy, buy has reduced the number of units available for rent, making the market a landlord's market. When in a landlord's market, renters have few avenues to remedy problems, lest they find themselves without a place to live and a "black mark" on their rental history as a "problem tenant." Rising rental rates coupled with rent control convince landlords to employ a strategy of high turnover to maximize rent increases. Rising home values further push rents up as the landlord must charge more to break even. Also, it has given rise to the "casual landlord." That person who should NEVER have bought a place, knowing that their stay in a particular area was likely to be short-lived, and is forced to rent it out due to a sudden change of venue/need for major work before resale/lack of equity-to-value/etc. Those are the WORST landlords. So, being a renter is a rather unattractive option these days. The only way that would be remedied is if sellers couldn't move their units and were forced to rent or sell to those who planned to rent, moving the market back to more of an equilibrium.

    But, really, it's not so much that everyone deserves a home, but that the middle class can no longer afford to own one. With the average one-bedroom condo going for over $300,000 in the District, what's someone living at the median (2007, regional) household income of $78,978 to do? Can't fit a family in a one-bedroom (can't fit one person in some of the one-bedrooms I've seen), can't realistically afford much more than that... About half of the population buying sounds about right, but when the median income isn't even close to sufficient to support that, then something needs to be done. It might have been better to let the market take care of it, get housing prices down, and let the chips fall where they may, but that's not what happened...

  • DC Native

    I don't believe the issue is realize the push for homeownership. I fervently believe that homeownership, especially for low and moderate income folks, is necessary to move up the economic ladder. It's just impossible for low and moderate income renters to ever truly build wealth and escape their situation by continuing to rent. The problem specifically with Inclusionary Zoning is that the form of ownership supported by these regulations will never allow a person to accumulate wealth and socio-economic mobility. It requires a person to committ fully to all of the responsibilities with absolutely none of the rewards of homeownership. It is a joke. Make these all affordable rentails, that would help.

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