Longmont Mayor Q & A

What does ‘affordability’ mean to you in the context of housing?  And what do you perceive is the missing middle? How do you propose to address the missing middle housing both for sale and rent?

 

DIANE CRIST: The question of Affordability is an excellent one especially as it relates to housing.  I would like to give you both a detailed and knowledgeable answer.

I have a Professional Accounting Degree and have worked with and adjacent to Financial and Economic strata for over 35 years.  When it comes to mortgages and rent payments the math is finite.  Households can only spend up to 30% of their income to remain financially sound.  The Council has played with stretching that number to 33%, maybe even 36% but has found that many households cannot qualify at those percentages.  What is more, one financial lender at the MISSING MIDDLE presentation on June 24^th made a credible argument that trying to subsidize or “fund the gap” on projects is one of the mechanisms driving up housing prices and keeping families from qualifying!

 

Currently, Longmont Housing Authority in it’s HousePAD presentation to City Council listed rent or mortgage payments of $2712 as 80% of Average Median Income (AMI) for 2 bedrooms.  This means a household needs to make $9064 per month in order to adequately cover that rent or mortgage payment, (30% of income.)  $9064 per month is an annual income of approx. $109,000.  The information published by Longmont Economic Development last year showed the average earning per job at $84,300 (100% AMI).  The HousePAD projections in 2025 use $84.400 for one person,  $96,400 for two.  The gap between having $84,400 or $96,400 in income but needing $109,000 to qualify for an 80% payment of $2712 is a mathematical definition of the missing middle.  Of course, the numbers move around a bit.  Unfortunately, the more attainable and affordable housing the City has built, the more prices have gone up, increasing the gap.  Building more is not the answer.

 

Right project, with the proper mix of attainably priced to higher priced homes, (the market rate build supporting market or below market pricing,) is needed and has the advantage of integrating rather than segregating “affordable” housing.

 

Right time, right place, and right people, meaning know the demographic and their metrics to ensure they can comfortably qualify and that the place and time support their income level rather than burdening them with further expense such as additional transportation needs or lack of core services.

 

More than any time in our history, we need elected officials who understand the economic principals that drive these dynamics.

 

SHAKEEL DALAL: “Affordability” means having homes in the city’s inventory of whatever size, shape and price suits the residents of that home and is financially sustainable for them. The typical benchmark is less than 30% of gross income. The real challenge is that we've made it expensive or illegal to build homes that people of average means can afford. This is where the "missing middle" comes in. True affordability comes from having enough housing supply at all income levels. When we only allow expensive single-family homes or large apartment complexes, we force everyone to compete for limited options, driving up prices.

 

When most people describe “Affordable housing” they mean a subsidized home provided through the Longmont Housing Authority, potentially paired with social services (“supportive housing”) if they need them. As a City, we have a moral obligation to care for those among us who need it, and I will continue to support the City of Longmont’s Affordable housing program. But "Affordable housing" in the programmatic sense can only help a small number of people. According to Longmont's 2023 Housing Needs Assessment, we need 14,000 more affordable homes just for people who already live here. The Housing Authority simply cannot build that many subsidized units.

Using federal LIHTC subsidies, as is our current practice, Longmont would need $3.8 Billion just to backfill our current shortage. This is about 10x Longmont’s annual budget and 36% of the LIHTC program’s 2024 national budget. It. Will. Never. Happen.  See this blog I wrote about exactly this issue: https://shakeelformayor.com/policy/the-federal-government-was-never-going-to-solve-longmonts-housing-crisis/

 

Missing middle housing refers to the types of homes that used to be common in American neighborhoods but have been made broadly illegal by modern zoning: duplexes, triplexes, fourplexes, small apartment buildings, townhouses, and courtyard apartments. You can see missing middle housing throughout Longmont's older neighborhoods - the Historic East and West Side have plenty of duplexes and small apartment buildings that were built before zoning was invented.

 

Missing middle housing creates affordability in several ways:

• Lower per-unit land costs: When you can put two or three families on a lot instead of one, the land cost per family drops significantly
• Smaller units: A duplex unit is smaller than a single-family home, making it more affordable to buy or rent
• Homeownership opportunities: Many missing middle buildings can be owned as condos or purchased by families who live in one unit and rent out the other
• Rental opportunities too: The same zoning changes that enable missing middle for-sale housing also create rental opportunities for people who don’t want to buy or aren’t ready yet
• Market-rate affordability: These units can be affordable without subsidies because they're cheaper to build per unit
• Local wealth creation: Small-scale rental buildings (4-6 units) are often owned by local landlords rather than large corporations, keeping them more affordable and responsive to tenants
• Diversity of construction: Because missing middle projects are typically one lot at a time, these types of construction projects are smaller scale. This naturally results in a greater diversity of sizes, shapes and prices depending on the particulars of the project.

Plan of Action:

• Legalize missing middle housing in every residential neighborhood, starting with townhomes and single family attached
• Allow single-family homes to be converted into missing middle housing types
• Streamline the approval process - it shouldn't be as hard to build a duplex as it is to build 300 apartments

SUSIE HIDALGO-FAHRING: Housing affordability” means that no more than 30% of gross income is going toward rent or mortgage along with utilities. When costs rise above this threshold, households are considered cost-burdened, impacting people’s livelihood and quality of life. 

 

The “missing middle” housing types are ones that fall between single-family homes and large apartment complexes, such as duplexes, triplexes, townhomes, cottage courts, and small multiplexes. Missing middle housing provides moderate density, lower per-unit costs, and walkable neighborhood settings, making it a more attainable option for middle-income households.

 

The 2023 Housing Needs Assessment shows that nearly 7,000 Longmont households are cost-burdened, and another 5,700 are severely cost-burdened, paying more than half of their income on housing. With the median home price being over $560,000, and a typical two-bedroom rental is approximately $2,000 a month, only about 15% of renters can afford to transition into homeownership.

 

Ways to address missing middle housing that I would encourage is to update sections of our zoning to allow small-scale housing types in single family, reduced lot size, and make accessory dwelling units easier to add. We have added some incentives for developers with density bonuses and fee reductions on for-sale affordable and attainable developments. I would like to assess what is working, where the barriers are, and adjust where needed. As well as creating a support mechanism for local small-scale builders who want to produce missing middle housing. We can preserve affordability by funding rehabilitation of older rentals, partnering with community land trusts, and expanding down-payment assistance for moderate-income buyers.

 

Longmont has set a goal of reaching 12% affordable housing stock by 2035. I believe expanding the missing middle is a crucial step toward that goal, and toward keeping teachers, nurses, service workers, and other essential members of our workforce in the community.

SARAH LEVISON:
The standard of “affordability” is defined by the U.S. Census Bureau in two ways: gross rent, the rent as well as the utilities and fuels paid by the tenant or housing costs which includes rent, mortgage, property taxes, utilities, insurance, and condo, HOA or mobile home fees. (source Pew Research Center). When it comes to housing costs.  In Colorado and Longmont close to 50% of renters and 29% homeowners with mortgages are cost burdened.  (Pew Research Center) 

 

For Longmont and Boulder county affordability can be extrapolated from the Boulder Community Foundation 2024 Trends report.  While the median income in Boulder County is $102,772, the median income in Longmont is $89,724. Data from the Trends report is that Boulder County median renters earn $61,453 and median homeowner income is $136,672.  Longmont median earners find it a better place to rent and harder to become a homeowner.

 

The “missing middle” income is defined as those making between 120% and 80% of the area median income, for Longmont this is $107,668 and $71,779. 

 

Addressing the needs of these wage earners, we need to listen to suggestions from our building and development community to work together to supply housing in this price range.  I will do that as mayor.  For both renters and home owners, the city can continue to fund the ‘attainable housing” programs it has in place.  Working with non profit housing developers like Thistle, Habitat for Humanity and Longmont Housing Authority the city could also fund rehabilitation of distressed properties in our older neighborhoods. These properties would be ideal rentals for the “missing middle”.  For purchase, these older homes are less than 2,000 square feet and priced well if not already renovated.  These liveable homes are an opportunity for the “missing middle” earners to get into a home.  Past generations started in a modest home and built equity with incremental improvements.  This model can work again.

https://www.pewresearch.org/short-reads/2024/10/25/a-look-at-the-state-of-affordable-housing-in-the-us/#:~:text=What%20makes%20a%20home%20affordable,of%20Housing%20and%20Urban%20Development

Longmont has seen an increase in new multi-family construction recently, and vacancy rates are rising. How would you approach future growth to ensure we don’t overbuild, while still meeting the community’s long‑term housing needs and keeping homes attainable?

 

DIANE CRIST: First, I think we need to come to the understanding that not everyone can or should live in Longmont.  Longmont does not have the landmass of a city like Houston, nor should we urbanize like Denver.  We need to remember who we are.  People come here for the beauty and stay for the opportunities and community.

 

When I was Vice Chair of the Transportation Board, staff shared a metric showing ~60% of Longmont traveled outside of town for work, while another ~60% drove into Longmont for work.  What a loss of effort for 60% of our population!  We can’t force people to work and live in the same place, but we can build communities that cater to the needs of those who would live closer to their work if they could.

The Ward I currently represent, Ward 1, is home to some of the last Condo’s built in Longmont.  As you may know, construction defect laws have made building Condo’s burdensome for contractors.  New state laws are a step in the right direction but not yet to the point of incentivizing new construction. 

Nevertheless, Ward 1 is also home to for sale, multi-family age 55+ units known as the Village Co-op.  My constituent who gave me a tour of the building and his home, reports it is the most affordable housing for seniors he and his wife could find.  They share a prorated portion of the mortgage interest and property tax payment with the whole building and they are able to sell at a modest increase in price should they need to move on.  Most importantly, they were able to downsize from their family size home, releasing more housing, and find something more appropriate to their needs.  Condos are a great place to start home ownership.  Lacking any new Condo builds, perhaps a co-op for first time buyers as an alternative to multi-family apartments could be popular.

 

Defining who needs housing, what fulfills their needs, as well as the needs of the community to have workforce and support for local business at the ready is step one.  Using the Right Project, right time, and right place approach to mindfully meet those needs is step two.  Longmont is known for creative, innovative solutions and having the right skills and understanding of economic levers on the City Council to create and maintain a low cost of living is vital to meeting our long-term and attainable housing needs.   With the right data, a knowledgeable Council and thoughtful action, we can do this.

 

SHAKEEL DALAL:
This question highlights how our current housing policies create artificial scarcity that paradoxically limits investment opportunities. By adding housing inventory, we can create a more dynamic market that mutually benefits residents and investors of all types.  Longmont's rental vacancy rate of 3.5% remains below the healthy 5-8% range that indicates balanced supply and demand. Our for-sale vacancy rate of 1% demonstrates severe undersupply in the ownership market. This artificial scarcity constrains opportunities for smaller investors while concentrating benefits among large-scale operators.

 

Creating Market Opportunities Through Supply

Our restrictive zoning channels development into large rental projects, limiting participation to investors with significant liquid capital who must compete with stock market returns. This excludes many potential market participants who could add valuable housing inventory.

 

Many longtime Longmont homeowners possess substantial illiquid wealth in their properties but lack smaller, affordable options to downsize to within the city. This prevents them from accessing their investment value for retirement while removing potential housing inventory from the market. These residents often downsize in place - moving out of upper floors as physical mobility decreases - without capturing any financial benefit.

 

Legalizing missing middle housing enables these homeowners to convert properties into duplexes, accessing liquidity while adding for-sale inventory. Unlike large investors seeking competitive returns, these smaller participants prioritize accessing their existing wealth rather than maximizing future gains. This creates a different investment dynamic that's less sensitive to today’s profit margin fluctuations.

 

Market Self-Regulation

A looser housing market naturally regulates investment activity. When profit margins decline due to increased supply, large investors seeking to park cash will redirect their capital elsewhere. Meanwhile, the expanded market creates entry points for smaller investors and owner-occupants who operate under different financial models.

 

Current construction patterns reflect zoning limitations rather than natural market demand. Diversifying allowable housing types will distribute growth across different scales and ownership models, creating the market dynamism necessary for a healthier housing ecosystem while addressing our substantial shortage.

 

SUSIE HIDALGO-FAHRING:
I agree that Longmont has seen a lot of new multi-family construction, and vacancy rates are starting to rise. I think the key is not just how many units we build, but whether we’re building the right types of housing at the right price points. To move forward, I’d focus on three things. First, we should diversify housing types, we need more duplexes, townhomes, and small-scale housing that is attainable for moderate-income families, not just large apartment complexes. Second, we must plan long-term, as we know demand will keep growing, even with the uptick of vacancy rates. And third, track the data closely using vacancy rates and affordability measures to guide when we encourage more building, and when to slow down certain types of development.

 

My goal is to promote a balanced approach, making sure we don’t overbuild in one category, while still meeting Longmont’s long-term housing needs and keeping homes within reach for the community.

SARAH LEVISON:
Supply and demand economics dictate that the market will make corrections on its own. As vacancy rates rise in multifamily buildings, developers will decide if they will go forward with approved projects. I am not in support of any position that has the city implementing protectionist policies to shut out competition. Where and what will be built is a conversation for the community at large when the Comprehensive Plan is updated. Longmont has seen the building boom cycle several times in the last three decades. In the late 1990s until the great recession of 2008-2011, many new single-family homes were built.  Fewer multifamily dwellings were built as the demand for this type of rental housing was not high.  Demand changed for rentals, and we have seen many new large-scale multi-family units built. The next wave I see coming is the smaller, incremental small scale infill developments.  This type of new housing is the most time consuming and difficult for the developer and the community as it means give and take on what works best for existing homes, development patterns, and the architecture in an established neighborhood.

 

I take a very measured and well researched approach to policy decisions. My past service on council, 2007-2015, was built on doing my own reading and research, studying materials sent to me by folks on both sides of an issue as well as staff reports. I look at all sides and can be influenced based on evidence.  As mayor, being open to all views and doing your own homework is what will serve everyone.