Does Creating New Affordable Housing Threaten What Little There is Now?

It’s no secret that a climate of uncertain Florida mortgage rates, higher home prices than ever before, and growing insurance and property tax rates have left many in Southwest Florida concerned for the area’s future.

The latter is moving up that laundry list of problems in a hurry. Thursday, a distraught owner of an affordable housing complex in East Naples told the Affordable Housing Commission that unless property owners like him get some property tax relief, they can’t financially survive.

“We are in a crisis and we have a formula for disaster. Rents have been capped for the past five years and expenses are going up,” said Alexander Nicholson, owner of Wild Pines apartment complex off Shadowlawn Drive.

• Nicholson said his property taxes have increased nearly 40 percent since he built the 200-unit complex six years ago. And his insurance rates have gone up 150 percent.
• Meanwhile, because he used government tax credits to help finance the apartments, his rents are capped by a U.S. Housing and Urban Development (HUD) formula.

Nicholson noted the irony of a county attempting to find ways to get more affordable housing built while doing nothing to see that existing affordable housing remains.

“You people are trying to get more affordable housing and your ships you have at sea are sinking. This is not only us I am looking for your advice to help solve this problem. We’re being taxed out of the ballpark,” he said.

Nicholson said he hears members of other affordable housing owners and organizations in Southwest Florida repeat the same concerns he has.

Cormac Giblin, the housing and grants manager for the county, told the commission that at a recent statewide convention he attended in Orlando, he heard similar stories.

“This is an ongoing theme statewide. It’s a problem all around Florida,” Giblin said.

In the past two years, as the Florida housing market sizzled, taxes on properties that are not protected by the Save Our Homes property tax cap have skyrocketed, too.

To keep from taxing homeowners out of the residences, the Save Our Homes constitutional amendment caps annual property assessment increases at 3 percent or the rate of inflation, whichever is less. That way, people can still afford to pay their Florida mortgages if tax rates rise much faster than incomes, which is all too frequent.

The protection applies only to a property owner’s primary residence, however. Rental properties have no such protection.

“That’s why, when the real estate market booms again, people like him will have to convert to condos,” said Sam Durso, head of the Collier County Habitat for Humanity.

Collier County Commissioner Jim Coletta, who attended the meeting, asked Nicholson to participate in researching solutions to the problem.

Commission members Mary Strutz, Essie Serrata and Chris Straton agreed to form a subcommittee to study the issue with Nicholson.

“We have to shore up what we already have,” Strutz said. Meanwhile, the panel went on to discuss an amendment to Collier County’s growth plan that increases from 500 to 1,000 the number of new affordable housing units that need to be built each year to keep up with demand. County planners had recommended 1,500 units, but the panel thought the goal was unrealistic.

As more citizens continue to worry about home prices and expenses, commissioners are expected to approve the amendments in January. The Collier County Affordable Housing Commission acts in an advisory capacity to the Collier County Commission, which appoints the members.