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Affordable housing in Denver: Not always as advertised

'Our Colorado' explores new projects coming in
Posted at 9:28 PM, Jun 20, 2018

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DENVER -- It’s a need. It’s a crisis. It’s all over the headlines. But is truly affordable housing being built in Denver? Or is it not as advertised?

“We have essentially created a jargon that is too broad in a way that allows sort of mischaracterization I guess,” Denver City Council member Rafael Espinoza told Denver7 on Wednesday.

Espinoza sees projects come before City Council with the word "affordable" attached all the time. He’s concerned about what the city has done (or not done) to address the issue.

“When I say strongly worded things like what we’ve done is pathetic, I’m trying to address the fact that it has been pathetic,” he said.

Real Definitions

The term “affordable housing” is thrown around a lot, and in some cases can be confusing as to what it actually entails. The term affordable housing has a definition at the federal level.

“Housing that is affordable to households that are below 60% of the area median income,” John Parvensky of the Colorado Coalition for the Homeless said. “Affordability is defined that someone is not paying more than 30% of their income for housing.”

In Denver, that’s a one-bedroom unit for $1,000 a month for a single person making under $38,000 per year. But the greatest need is for the even lower income.

“I think there is a crisis of affordability particularly for households below 30% of area median income,” Parvensky said.

That’s a single person making under $20,000 per year.

“There’s only 26 (affordable) units statewide for every 100 people,” he said, referring to that income level.

“Affordable” as advertised?

Some new projects in Denver like The Coloradan Condos have advertised “affordable” units. Developers tell Denver7 the cheapest comes in at $230,751 for a one-bedroom.

These are aimed at income levels between 50 percent and 95 percent of the area median income, or people making between $35,000 and $60,000 per year. Doing the math, even with $20,000 down and a good interest rate, a mortgage for that condo would be more than $1,000 per month, with an additional $400+ per month for HOA fees.

“It’s not really affordable housing. I think it’s an effort to either appease the city or make a dent in a part of the market that isn’t being met,” Parvensky said.

This is also the case outside of Denver, where “affordable” $300,000 units are being offered in Berthoud and “workforce” housing is being built in Silverthorne at around the same price.

Simply put, it is affordable by one definition to some people but is far from the individuals in most need of truly affordable housing.

What’s being done

Denver has proposed doubling its affordable housing fund from $15 million to $30 million, including an increased 2 percent tax on marijuana sales as well as increased contributions from the city’s general fund.

The Colorado Coalition for the Homeless told Denver7 that “two drops in the bucket are better than one.”

Denver Mayor Michael Hancock has also admitted that they city physically couldn’t build enough housing and do it fast enough to fill the need.