Housing Types and Housing Choices for a Complete Community

Some insights and updates on the Town's proposed "missing middle" housing strategy

Why is the Council considering these LUMO text amendments? 

The Council has a vision of making Chapel Hill a complete community where people from diverse backgrounds, experiences, and income levels can thrive – that means access to housing, parks, transit, jobs – and we are working on making all of those a reality for everyone. 

It is important to understand that the Housing Choices proposal is ONE of many strategies, policies, and tools the Council has been working on for several years to bring a holistic and strategic, rather than project-by-project and reactive, approach to growth so that it benefits both current and future residents and moves us forward in a more sustainable, equitable way. These include plans for climate action, affordable housing, parks and greenways, economic development, multimodal transit, and more. Taken on its own, Housing Choices will not achieve all of those aims. But as one of many strategies encompassed by our new Complete Community Framework, it will help us to meet this shared vision. 

What is the Council hoping to achieve with the Housing Choices proposal? 

• More diverse housing choices for a more diverse community

Allowing a range of housing types means that we’ll have more modest, more affordable choices — whether for a homeowner who wants to make sure their parents can age in place in an adjoining duplex, or for a young family hoping to live closer to work. Right now, many of our neighborhoods only allow the most expensive type of housing — single-family homes. These homes are expensive in part because land in Chapel Hill is so expensive, about $250,000 per acre, and that cost is borne by just one family. When we allow a wider range of choices — duplexes, triplexes, collections of small cottages — we create relatively affordable choices for families of all income levels and help seniors, young couples, and working people live in Chapel Hill. 

Additionally, as we grow, we want diverse housing types, rather than having growth concentrated only in high-density apartment buildings. The proposed changes would allow growth to occur, in part, by adding low levels of density scattered around town. As the name of the proposed changes suggests – Housing Choices – we want to create more choices. Two, three, and four family residences, accessory dwelling units, town homes, and cottages that could supplement the types of housing we already have. These are the so-called missing middle types of housing, named such because they effectively represent a middle ground between apartment building and single-family homes. Another benefit of the proposal is that homes would be built at a scale consistent with existing neighborhood homes – a new triplex won’t look that different from surrounding single-family homes, and it won’t look like a large apartment building. 

• Improving Affordability not creating “Affordable Housing”

This is not an affordable housing strategy. It never has been. It is a housing strategy. This is about having MORE — and different — housing. Chapel Hill, like most of the U.S., has restricted housing production for years and is now experiencing a serious housing shortage, which is inflating both rent and purchase prices. Because Chapel Hill will continue to be a highly sought-after place to live, we need to add more housing if we have any hope of avoiding becoming an exclusive walled-off enclave. 

The Town has many explicit affordable housing strategies and invests significantly in the production of new and preservation of existing affordable housing (for example, in FY22 the Council approved 123 new homes and funded preservation of 509 homes). These efforts also contribute to our Complete Community vision.

That being said, Housing Choices will contribute to some degree to improving overall town affordability.  The proposed changes include caps on the size of units that can be built, for example cottages can be no more than 1,600 square feet. There are similar limits on the other forms of housing. And if a builder can build four homes on a lot instead of one, the cost of the land baked into the sales prices of a new home would be ~$63,000 instead of $250,000. As a result, we expect that this will moderate the prices of new housing.

To be sure, there are limits to what this policy can achieve. Any new housing developed following this change will be subject to the housing market. This means new homes will be priced relative to the cost of existing ones. So, let’s be clear — the Oaks is not going to suddenly be affordable for a teacher or a police officer. But, instead of one expensive home, up to four could be built, which over time, will ease our housing shortage and help to moderate housing prices in town overall. So even the higher priced new homes built under this policy will help that teacher and police officer afford to live in town. 

• Prioritizing climate action and alternatives to cars

Any new housing built in Chapel Hill should be designed to get cars off our roads. Much of our town’s traffic is due to commuters — every day over 40,000 drive into Chapel Hill, 15,000 leave Chapel Hill and only about 7,000 live and work here. Enabling more people to live and work here will mean fewer commuters filling our roads and will also have significant climate-related benefits. By re-legalizing a range of housing options, we are reversing the rules that have created longer commutes and pushed people farther and farther away from their jobs. 

This is why the Housing Choice approach is supported by the Sierra Club as a strategy for minimizing sprawl and vehicle miles traveled by reducing the need for people to drive - one of the largest contributors to greenhouse gas emissions. These are important Sierra Club priorities to advance climate action, public health, and environmental justice, per their Urban Infill Guidance.

Chapel Hill is in good company!

• Addressing equity and exclusionary zoning (despite homeowners associations and restrictive covenants)

This proposed policy will be the most effective and equitable if it applies to as many neighborhoods in town as possible. However, some neighborhoods have homeowners associations (HOAs) and/or restrictive covenants that govern their neighborhoods. State law dictates that Town zoning regulations cannot supersede either of those. While HOAs mostly play practical purposes today such as governing shared spaces, those structures were once the primary vehicle to maintain segregation and prevent people of color from moving into those neighborhoods, following enactment of federal Fair Housing laws in the 1960’s. Even covenants with regulations that appear to be race neutral, such as minimum lot or home sizes, were historically used to maintain the racial status quo and are still likely to be more harmful to lower-income and families of color than white families because they make land and housing more expensive.

There are still many neighborhoods in Chapel Hill where the Housing Choices policy would apply (including mine, for those who have asked) and that makes it worth doing. This is an opportunity not only to make our town even better, it is also an opportunity to redress a historical wrong — and how often does that opportunity present itself? Regardless of what your neighborhood looks like today, single-family only zoning has roots in racism and segregation and those impacts are being felt today by Black families in our community. Homeownership is a key to multi-generational wealth-building. When that opportunity is systematically taken away, the repercussions are immense.

This is why the Biden White House also supports revising housing practices that have discriminatory effects: “Because disparities in wealth compound like an interest rate, the disinvestment in Black families across the country throughout our history is still felt sharply today. The median Black American family has thirteen cents for every one dollar in wealth held by White families.” The administration is even offering substantial grant funding to support local communities in reforming their exclusionary zoning.

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Since this is my blog, I’ll also quote my father, Dr. Michael Stegman, from his paper for the Harvard Joint Center for Housing Studies, Eliminating Exclusionary Land Use Regulations Should be the Civil Rights Issue of our Time:

Evidence is accumulating that the multiple layers of exclusionary zoning and land use controls are a powerful contributor not just to higher housing costs, but also to declining rates of economic mobility and productivity growth, and to widening disparities in the wealth of white and black Americans. 

 What happens next?

Town Planning staff are continuing to meet with neighborhoods on request. The Council will receive an update in April on what staff have heard and will discuss what revisions to the draft we might consider in response. Council members are listening to input and encourage questions and constructive suggestions.

Maintaining the status quo will not create our vision of Chapel Hill as a complete community. To ensure that people from diverse backgrounds, experiences, and income levels can thrive in Chapel Hill, we must start with increased access to housing.