Despite flurry of new apartments, experts say Alexandria has a housing shortage

The bottom line at a panel on housing last night: housing is unaffordable in Alexandria and likely won’t get cheaper without more construction.

Last night, the City of Alexandria hosted a panel of experts to discuss the state of housing in the city — from a look back at the evolution of the city’s zoning code to projections and trends in the housing market. The panel is part of the city’s ongoing Zoning for Housing/Housing for All project, which aims to reshape zoning in the city to be more accessible, affordable and available.

Even before the release of official recommendations about the Zoning for Housing/Housing for All plan, it’s already drawn some backlash from local residents. At a rally on Monday night outside of City Hall, residents expressed support for goals of adding more affordable housing, but shared concerns about how density could impact the city’s neighborhoods.

While the plan’s recommendations aren’t public yet, it comes in the wake of the “Missing Middle” zoning changes that stirred up similar contention in Arlington.

The panel on Tuesday night notably didn’t include specifics about the recommendations — that’s scheduled for a work session on Tuesday, Sept. 5 — though some previews of what’s to come did slip in.

Much of the panel focused on examining the present housing market, what role racial discrimination played in the structuring of the city’s neighborhoods, and federal funding opportunities for future housing projects.

Present

Anita Morrison, principal at Partnerships for Economic Solutions, said Alexandria’s housing supply has trended upward.

“In the last five years, the city’s seen 5,898 new units,” Morrison said. “The pipeline includes another 2,000 units under construction and 18,000 in the pipeline, some of which we can expect will not come into fruition.”

Morrison said that project pipeline includes huge redevelopment like that at Landmark Mall and the Potomac GenOn power plant.

Morrison also credited some of that swelling in local units to office conversions to residential buildings, a market in which Alexandria is leading.

“One of the ways to bring that many units to the market has been a change in the nature of the office market, reducing the demand for office space,” Morrison said. “For some older buildings, this has meant their occupancy fell a lot and created a need to do something different.”

Morrison said 1,700 units have been added to the city through office conversions.

Despite the increase in units, Morrison noted that rents have also continued to trend upward.

“In 2020, average rents declined to 2018 levels,” Morrison said, ” but then rebounded in 2021.”

Morrison said the high rents are squeezing out young professionals.

“The fastest growing age category is people ages 65-74 and children under 20, but folks 20-24 dropped in Alexandria and 25-34 did not grow as much as the rest of the market,” Morrison said. “We think that’s a reflection of not being able to buy here.”

An attendee asked if the increase in units not leading to a lower rents punches a hole in the argument that more supply will drive down rents. Morrison replied that the market is more complicated than that.

“The scale of developments haven’t met the need,” Morrison said. “We’re always running a few steps behind the demand. It’s about getting enough supply to increase vacancy rates and create competition, but we’ve never moved the needle enough with supply to see that happen.”

Past

One of the goals of Zoning for Housing/Housing for All has been addressing historic inequality in Alexandria.

Krystyn Moon, a Professor of History and American Studies at the University of Mary Washington, said racial covenants in neighborhoods started later in Alexandria than in other places but segregation in housing endured after the Fair Housing Act of 1968.

Moon said housing started shifting dramatically in the 60s with the passage of the Fair Housing Act and the Housing and Urban Development Act.

“This opens up mortgages to low and moderate-income families,” Moon said. “In Alexandria, it particularly opens them to African American residents. Not only is there an increase in home ownership for African Americans as a result, but an opening up of neighborhoods closed off to them in the past, particularly north of Rosemont.”

But Moon said there were still problems with the neighborhood and de facto segregation was still in place.

“There were still problems with this program: western parts of the city were still closed off to African American families,” Moon said. “And many families moved to northern parts of the city, so much so that we see a white flight and, combined with environmental degradation caused by Four Mile Run, we see re-segregation emerge in that part of the city.”

Future

Marion McFadden, Principal Deputy Assistant Secretary for Community Planning and Development with the U.S. Department of Housing and Urban Development, said the shift happening in Alexandria fits in with national discussions on how housing should change.

“Zoning for Housing elevates the conversation around addressing barriers to housing,” McFadden said. “This is a great example of a community coming together to have the critical discussions about removing those barriers.”

Nationwide, McFadden said there’s a shortage of 1.5 million homes, which she called a conservative estimate.

The upside, she said, is that Congress has allocated $85 million to help localities with projects that address housing affordability. The funds prioritize places with the greatest need of affordable housing — and Alexandria is on that list, she said.

“Congress did not tell us to fund a specific thing, so in doing the application, it’s about giving us a narrative of what your challenges are, what steps you’ve taken, and what steps federal funding of up to $10 million can do to get you the rest of the way,” McFadden said.

She added that municipalities can propose something other than a housing solution.

“If the thing that stops you from creating more affordable housing is schools or something else, come in and tell us,” she said.

Planning Director Karl Moritz said the panel would not address the specifics of the Zoning for Housing/Housing for All plan, but did offer some clues about potential changes.

“What we’re trying to accomplish is something between a single-family detached house and an apartment building,” Moritz said. “That’s something we have a very limited supply of [with just] a few townhouses here and there.”

Moritz also said the zoning recommendations will not impact current historic preservation protections.

Those recommendations will be revealed at a Joint City Council/Planning Commission work session on Tuesday, Sept. 5, from 5-7 p.m. in the City Council workroom at City Hall (301 King Street), followed by months of public hearings and town halls ahead of a final vote on Nov. 28.

The full panel is available to watch at the City’s website.