Despite Charles County's frequent appearance at the top of median income lists at regional, state and national levels, there are still many residents struggling to keep money in their pockets and roofs over their heads.
According to a report from the county's Department of Planning and Growth Management senior staff, Charles County needs to focus on making more homes available for residents who earn between $30,000 and $60,000 per year.
To do that planning administrators suggested expanding rural village boundaries and densities and offering a new incentive-based floating zone called Affordable Housing Planned Development.
The county commissioners reached a consensus at their meeting Nov. 30 to forward the recommendations to the planning commission and housing authority for presentation.
"The recommendations are to consider strengthening the incentives for the [moderately priced dwelling unit] program to make it more attractive for developers but really not to mandate that at this time given the economic conditions," said Steven Ball, the county's planning director. "Also we want to better define the preferred policies for these different areas, whether it's where the MPDU should be focused, whether or not we want to allow them in rural villages and we want to bring forth some of these questions about affordable housing as part of our comprehensive plan update and review these preferred policies with the public over the next year."
According to data compiled from the U.S. Department of Housing and Urban Development and the Maryland State Department of Assessments and Taxation, the average household income for a family of four in Charles County is a little more than $100,000.
"I think the most chilling thing is we still have a serious disparity in our community as it relates to housing affordability for our residents that don't have incomes that exceed $60,000," said Commissioner Reuben B. Collins II (D). "That will continue to be a challenge for our community."
"That absolutely is what we're seeing," said Beth Gilliland, president of the Southern Maryland Association of Realtors. "We're seeing a lot of people who come into their local Realtor, say they'd like to buy a house and the Realtor recommends they speak to a reputable loan officer. That loan officer says they don't qualify after the new stringent banking rules. Mostly these people don't have enough money for a down payment.
"I don't think that means the county needs to build low-income housing. What that means is we have got a lot of low-priced houses in the market right now just with the way the economy has gone. What we, the county and state need to do is help people overcome these problems."
The county's housing authority has accepted affordable housing as household income between 30 and 80 percent of the median family income for Charles County; the most recent figure calculated by the HUD is $102,000. Work force housing is defined as a household income between 60 and 120 percent of the median family income.
"I'm not surprised," Brad Howard, a housing authority board member, said after being asked about the presentation's conclusions. "The economic times make it really tough especially in the income categories they focused on, actually being able to afford to buy houses. The market supply is not in that range of $30,000 to $40,000 or less and those people are feeling the cramp. They can't afford anything over $200,000. The supply of those kinds of houses is not here."
Howard is with Maryland Bank & Trust and backed Gilliland's opinion on down payment assistance, that lack of enough funding makes coming up with a down payment an obstacle to owning a home.
He said the housing authority is looking ahead at opportunities, but it is in preliminary stages. There will be a presentation about the housing supply and demand to the housing authority board in January.
"Community services had two programs; they … utilized all the money that was available and helped 46 homeowners. That doesn't sound like a whole lot, but in those instances either it was loan closing help or down payment [assistance] depending on the income level. [Outgoing Charles County] Commissioner Edith J. Patterson hit it on the head when she asked whether the county was going out and pursuing opportunities to provide that kind of assistance for those kinds of residents," he said.
Howard said he felt the county's community services department had done its job and that there was probably more housing assistance out there to look at in the future that the housing authority board will be looking toward as well.
"Their mission is so the lowest of the low incomes can have reasonable and affordable housing," Howard said. "Obviously, in this county, we should be able to accomplish that."
"The intent is to document available housing based on various income levels especially in regards to affordable and work force housing," Charles County Director of Planning and Growth Management Chuck Beall said. "If we can verify the degree — or the amount of need — the [MPDU] program can be better designed to target specific areas of need."
Using the industry standard of 30 percent of income to pay for monthly housing costs, the county's planning department arrived at the following estimated totals. Gilliland confirmed that 30 percent is the accurate standard.
Ball explained that county staff took the total county supply of homes — per assessment data from 2010 — and calculated that estimated income needed to buy a house of a certain price.
The existing households within those income ranges were compared with the demand that was derived from county data from 2008.
The demand for homes ranging between $100,001 and $200,000 — the affordable housing range — is greater than the supply of homes by 164 households.
For this range there are 8,864 available homes in the county, but there are 9,028 existing households with an income between $30,000 and $60,000 that could afford this price level.
The supply of homes ranging between $275,001 and $425,000 — the work force housing range — is greater than the demand for homes by 6,575 households; there are 18,260 homes available and a potential demand of 11,685 household incomes at that price range.
The supply of homes ranging between $200,001 and $275,000 — the overlap for affordable and work force housing ranges — is greater than the demand for homes by 8,558 households.
The data from the two different years used in the presentation show that only one category, in the least expensive price range, had too few homes for the calculated demand.
Incoming Commissioner Bobby Rucci (D) is also a member of the Southern Maryland Association of Realtors. Though he hadn't seen the supply and demand presentation Rucci said there are quite a few houses on the market in Charles County.
Asked about Gilliland's opinion on down payment assistance, Rucci agreed it was an important factor in putting new homebuyers under a roof.
"For first-time homebuyers, it's huge to get that down payment assistance," Rucci said. "A lot of people are stretching to get into that house and while each individual has their own scenario [down payment assistance] is definitely a big helping hand."
He said the supply of affordable houses is spread out across the county and there are a number of foreclosed homes on the market as well.
Rucci said there are currently 366 homes on the market in the county for less than $200,000. He said a person with a $36,000 annual income could afford a home with roughly a $120,000 price tag. Someone with an income of roughly $60,000 could afford a home for $200,000.
"There is quite a bit of houses under $200,000," Rucci said, but the problem is that once homebuyers get into the house, the debt-to-income ratio is what causes many to struggle to make ends meet.
Prompted by the efforts of the county government to provide more affordable housing for residents, the supply and demand report is a months-long product of data gathering and statistics that point to the sobering fact that changes need to be made when it comes to residential development.
"This is not an exhaustive study. There are other programs and polices and many of those are run from [the department of community services] that assist with housing need," Ball said. "This is just looking at supply and demand and zoning. It has a narrow focus in that respect."
Preferred locations, housing conditions and proximity to work, schools and shopping were not considered either, Ball said.
Gilliland said the issue is not that there aren't enough reasonably priced homes, "there's a lot of stuff out there these people can afford," but the down payment requirements are what get potential homebuyers.
"If someone is going to buy a $300,000 house they need almost [$10,000] in the bank," Gilliland said. "Down payment assistance is really the key. That would be removing one of those huge boulders for a lot of these families."
Gilliland mentioned the Neighborhood Conservation Initiative as an example of this kind of down payment help, but that it had too low an income cap to help as many people as it could have.
The NCI down payment assistance program was made up of roughly $1 million in federal stimulus funds to assist prospective Charles County homebuyers in getting between $14,999 and $39,999 to purchase certain foreclosed properties this year. Nearly 50 homebuyers found local houses to call their own.
"I know that with the stimulus funds we received, that was a very successful program. Having that assistance was extremely useful," Collins said.
Collins will be the lone commissioner from the 2006-10 administration to continue on to the new board.
He said that as for Gilliland's opinion on focusing on foreclosed homes, "I think we're on the same page. But for me the most glaring issue with that report, which I think is extremely important, is showing that we have a tremendous disparity," in homes available for the affordable housing income level.
"It's going to be whether we as a government have the will to really move forward; do we view this as a priority," Collins said. "There's always a feeling that whenever you talk about affordable housing it's palatable to call it work force housing. But we have plenty of work force housing."
Collins pointed out that the MPDU program would create guidelines for affordable housing. One such example would be setting aside a portion of a new development that is proposed for affordable homes that could be sold at less than the market rate.
Ball did acknowledge down payment issues related to housing as well as credit and diversity as problem areas for putting residents in homes.
The latter he said does allow for a greater choice in opportunities for housing at all income levels and he mentioned townhomes as the one area he sees as having a large demand in the housing market at this time.
In a similar vein — in fact the second half of the report — county staff looked at ways to increase density and diversity of residences in the county.
"We looked across the board at density increases and whether or not we should be allowing planned manufactured homes outside our development district and really the need to change village boundaries and increase densities in rural villages as another option," Ball said.
Ball explained that the county has an incentive-based temporary MPDU program in its zoning code, but it's not used very often.
Patterson asked about where planned manufactured homes are permitted in the county.
County Attorney Roger Fink said that when the county first adopted its zoning ordinance the existing mobile homes were inventoried and grandfathered in as allowed nonconforming uses. Any new mobile home parks must be cited as compatible with and meet the purposes of that particular planned manufactured home floating zone.
"It's most everyone's dream to be a homeowner and we don't have an available stock of that priced home for affordable housing," said outgoing Commissioner Sam Graves (D). "So as a government and as a community we need to look at that and how and where we can locate those homes for people who wish to be homeowners in that category."
Graves also asked about linking the transfer of developer's rights program with the recommendations involving the rural villages, which Ball agreed would be "good planning," to have diverse neighborhoods.
TDR programs buy development rights from farmers and sell them to developers in exchange for higher density on projects in urban areas.