Planning Beyond the Crunch: Funding Affordable Housing – Solutions in Baltimore



Economic expansion is underway in the United States with obvious growth in corporate revenues and personal incomes. That said, there are still some noticeable soft zones in the economy, with housing being the most noteworthy.


There’s a housing crunch in Maryland. In communities like Baltimore and Potomac, the demand for both low-income housing and homes on the high-end of the real estate market continue to create anxiety for buyers, sellers, and renters. Luckily, a growing cadre of professionals like Todd Lubar of Bethesda are rising to meet the housing demand by providing products and services that offer clients common-sense solutions amid an obvious housing crunch. Partnering with Maryland communities and constituencies to replace dilapidated housing with modern and affordable alternatives, Todd Lubar and others understand that access to an assortment of financing options is a “must have” if individuals and families hope to overcome the “crunch.”


Struggling in Baltimore


“Our city is in crisis,” recently noted Jennifer Kunze who lives in the southwest corner of Baltimore. While attending a recent Board of Estimates meeting in Baltimore, Kruze summarized the escalating housing trouble in her city. “We have people sleeping in the streets, including during nights like last night when the temperatures were in the 20s. We have children who don’t have a safe place to lay their heads at night. We have decrepit housing. Just a few months ago, a house fell apart onto the sidewalk a block from my house.”


Baltimore Housing Commissioner Michael Braverman agreed with Kruze’s assessment that the city doesn’t have enough affordable housing, articulating how Baltimore hopes to address the crisis in the near term. “Clearly we aren’t meeting the need,” Braverman said while meeting with a group of concerned citizens, “but, as a city, we’re spending or leveraging close to $40 million a year for affordable housing, broadly defined.” Braverman contends that the solution for Baltimore and other communities facing a housing crunch centers on providing a mixture of new housing options along with a bevy of renovated homes. Further, public entities and private businesses must provide the financial resources to demolish houses that are beyond a reasonable scope of repair. While Baltimore is putting an additional $10 million into the affordable housing basket for the upcoming year, it is clear that the real catalyst for housing expansion resides with the private financing options that fuel private construction and home purchases. For Todd Lubar and other professionals on the financing edge of the real estate market, finding funding resources for constituencies that are often overlooked by traditional institutions is an important step in overcoming the “crunch.” Involved in over 7000 real estate transactions over the years, Todd Lubar works among an expanding segment of real estate professionals specially equipped to find financing products that work for underserved constituencies. For Lubar and his colleagues, the ability to analyze the overall risk of almost any loan scenario and make appropriate decisions based primarily on market conditions, means good outcomes for both individuals and communities.


Other Approaches


Back in Baltimore, councilpersons like Bill Henry believe that a mixture of financing options including city investments and personal loans, must be coupled with additional tax revenue to ensuring a workable solution to mounting housing concerns. In his prosed “20/20” plan, Henry envisions the City of Baltimore raising the recording fee by 20% and transfer taxes by 17% providing a robust, sustainable revenue source for the city’s Affordable Housing Trust Fund. The Affordable Housing Trust Fund is a voter approved measure stifled with many years of “bare cupboards.” Countering Henry’s approach, Baltimore mayor Catherine Pugh hopes to raise the city’s bonding authority by 15 million a year to help create affordable housing for residents.


Potomac and Montgomery Housing


In the affluent communities of Montgomery County, the affordable housing “crunch” resonates with citizens trying to find a realistic entry point into a market stocked with high-end subdivisions and condos. Unlike Baltimore, private investors, not local governments, continue to purchase land parcels and older townhome units with the hope of creating affordable housing options for working class citizens. As Todd Lubar continues to discover in his own real estate practice, refurbished and new housing always benefit communities if constituencies have access to the financing needed to purchase the options “on the market.”


Indeed, we live in interesting economic times. As the US economy and housing markets continue to move into “Bullish Territory” with expansive growth, the constituencies fueling the growth struggle to find appropriate housing at a price point that works for working-class budgets. If Todd Lubar and other real estate gurus have their say, great housing is ahead for those willing to do some research and explore a host of financing options.