When Charleston Housing Authority CEO Don Cameron came to the Holy City in 1975, two-thirds of the roughly 40,000 people living on the peninsula were black and they either rented or were mostly elderly women owners. The rest were mostly affluent whites.
Today, the peninsula’s makeup has flip-flopped. Just 38 percent of the population is African-American, the rental and ownership rates haven’t changed that much for blacks, and wealthy whites and a burgeoning white middle-class are on the rise, he said.
“Obviously, gentrification has taken its toll on the African-American population on the peninsula,” Cameron said. “African-Americans still have a strong home ownership rate, but they are predominantly women. Others are renters, and they are predominantly low-income and most of them live in affordable housing.”
As Charleston’s cache as a bustling tourist town filled with scenic streets and highly rated restaurants blossomed over the past four decades, so did the rise of well-heeled newcomers and investors, all seeking a place on the peninsula to call home or pad their pocketbooks.
When more affluent arrivals buy into a neighborhood, they generally improve the property, increasing its value and that of their neighbors. As more and more people of higher means move in, some longtime homeowners can no longer afford the house they live in and renters are pushed out by the same affordability issue.
It’s happened throughout Charleston, starting on the lower peninsula and spreading northward, threatening to drive out working-class residents in service-sector jobs, such as those who clean hotel rooms, cook restaurant meals and police the streets.
On Monday, a panel of local and national officials will gather at the Charleston Museum auditorium to address the growing housing affordability problem in Charleston.
For Cameron, the problem can be summed up in two phrases.
“We don’t have enough rental stock, and the stock we have is not affordable,” he said. “We have to create more stock if we are going to tackle the problem, and it has to be affordable.”
To emphasize the lack of affordable housing on the peninsula, Cameron said 42 percent of renters who receive Housing Authority help with housing costs live outside the city of Charleston “because they can’t find shelter that’s modest and affordable.”
Adding to the problem is that many apartment complexes on the peninsula or nearby are too expensive or are hemmed in by government restrictions, he said.
“In the Section 8 (government-subsidized housing) program, if you take one Section 8 resident in an apartment complex, you cannot limit the number you take in the future,” Cameron said. “It’s not that they are opposed to the idea, but apartment managers are worried about getting out of balance.”
Some of the newer apartment complexes coming to the peninsula offer a give-and-take with the city, guaranteeing a certain percentage of units for workforce housing in return for denser developments. That will help in the short term, but after 10 years they don’t have to abide by that rule, according to Cameron.
Workforce housing is geared toward helping people with limited incomes to live closer to where they work.
“It’s a loss to the community in stock,” he said. “The city knows if we own it and manage it, it perpetually will be affordable.”
Cameron said it makes more sense for affordable housing to be publicly owned in the long term because the Housing Authority, as a public entity, does not pay property taxes and the state provides property insurance at a much lower rate than the private market.
Those savings often translate into $150 to $200 a month per aid recipient.
The Charleston Housing Authority provides assistance to 4,100 families, with 2,700 of those in public housing. The remainder receive rental assistance through Section 8 housing.
Last year in June, a panel of housing and business experts came together in North Charleston to address housing affordability in the Charleston region.
There was lots of talk about the problem, but little input on a solution and the problem is growing.
“Things have gotten worse,” said Michelle Mapp, CEO of the S.C. Community Loan Fund, which helps with affordable housing.
“It comes down to a supply-and-demand issue,” she said. “When you have low supply and high demand, it causes prices to rise.”
That’s what’s happening in the Charleston region. As more people move to the region — 43 a day, according to the Charleston Metro Chamber of Commerce — in search of jobs and the quality of life the Lowcountry offers, the demand for housing grows. So far this year, homes in the region are selling at a median price of $234,000, up 7.6 percent over the first four months of 2015.
Some areas are already unaffordable for the average family, including Mount Pleasant, where the median price for a home is now $400,000, according to the Charleston Trident Association of Realtors.
Rental rates are on the rise as well. The average cost for a one-bedroom apartment in Charleston is $1,140, a 35.2 percent increase since 2011, according to Rent Jungle.
Added to the rising costs to buy or rent is opposition for denser developments in urban areas by some government leaders and the not-in-my-backyard voices.
“That’s more housing units not coming to the marketplace,” Mapp said.
Inner-city workforce housing allows people with entry-level incomes and service-sector jobs to live closer to where they work so they won’t have to commute from the suburbs.
The more resistance there is to infill housing developments, Mapp said, the more it forces home builders and apartment projects to the suburbs, furthering sprawl and traffic congestion.
During Monday’s forum, panelists will focus on housing affordability on the peninsula, specifically for the area around Hampton Park called North Central, where home prices jumped 30 percent to 75 percent more rapidly than prices on much of the peninsula between 2009 and 2014, according to a study by the Historic Charleston Foundation.
The overall price of homes on the upper peninsula escalated 60 percent from 2011 to 2015 to a median of $341,250, according to Charleston Trident Association of Realtors. As gentrification moves up the peninsula, lower-income residents and home seekers are at risk of being priced out of the market, according to housing officials.
“The rapid escalation in housing prices, if left unchecked, will alter the character of many of the neighborhoods on the peninsula and pose a serious threat to peninsular housing access for residents in the middle- and the lower-middle income categories,” according to the Historic Charleston Foundation.
Among the options being considered to protect neighborhood character and stabilize the workforce housing market on the peninsula are changing city policy to require more workforce housing, establishing a local community land trust and offering low-interest loans to homeowners, Mapp said.
“As long as people move here, there is going to be a demand for housing,” she said. ”We are going to have to realize as a region and a community that we need a significantly larger number of housing units, and we need to come together to see where it is best to put those units.”
A report coming out in June during the next regional affordable housing forum will address that issue, she said.
Generally, about 30 percent of household income should go toward housing to pay for principal, interest, taxes and insurance. For many, especially those on lower incomes, that figure rises well above that amount, Mapp said.
The median household income for the Charleston area is about $54,000. Per capita income is about $29,000. With 30 percent allocated to housing, a single person earning the average per capita income would be left with about $20,000 each year for food, transportation, healthcare, recreation and other services before payroll taxes.
“We need to offer housing to persons at diverse income levels,” said Geona Shaw-Johnson, director of housing and community development for the city of Charleston. “That’s the challenge.”
To help preserve older homes, Charleston offers a first-time homeownership initiative for qualifying applicants and rehabilitation programs ranging from roof replacement to almost an entire house.
Also, the city, during the past 12 years, has built 107 workforce housing units, mainly on the peninsula to help with affordable housing offerings.
They include the Cottages at Longborough north of Hampton Park and Peecksen and Porters courts off Bogard Street near the Septima P. Clark Parkway.
Shaw-Johnson called those programs good, but “we know we have to enhance our efforts. We need to be more strategic on what we build and where we build to help meet the demand of housing in our community.”
Reach Warren L. Wise at 843 937-5524 or twitter.com/warrenlancewise.