By Tim Farley, For the City Sentinel
Renters in Oklahoma City continue to confront limited housing options which are largely unaffordable, and in some cases, in poor condition, according to a study presented to the city council earlier this week.
Oklahoma City Planner Kim Cooper-Hart said the presentation allowed city staff members and the council to gain an understanding of the “housing landscape and how it affects the people and their need to keep shelter in place. We also learned how much (of the housing market) is not affordable. It helped us recognize the scale of the problem.”
The study was conducted by Economic & Planning Systems of Denver, Colorado.
The housing study provided information to city officials that would allow them to mitigate the unaffordable rental market, while also understanding that “it’s not a one-size-fits-all” solution when comparing Oklahoma City to peer cities.
Although Oklahoma City’s housing market has remained steady during recessions for many residents, not everyone has shared in that experience. According to the study, more than 68,000 households spend more than 30% of their gross income on housing, which impacts their financial stability. The study also determined that for a variety of market and income factors, the portions of neighborhoods in the city affordable to black households has declined over the last decade, “impeding their pursuit of economic opportunity and access to quality schools.”
In addition, the amount of the city’s rental supply and demand pose tough challenges with renters accounting for a larger portion of all households than they did 10 years ago, the study found. Housing stability is largely a problem for Oklahoma City’s low-income, minority and elderly renter households, according to the study’s authors. The study also found that renters earning less than $50,000 are more likely to be living in housing with serious need of rehabilitation, struggling with a life event compromising their ability to earn a living or hold a job, trying to remedy a bad credit history, having difficulty finding accessible housing or experiencing discrimination.
At the same time, the study discovered that home ownership in Oklahoma City is losing ground. Although mortgage interest rates have been at historic lows, only 30% of the city’s new households were owners. The study also revealed there were 5,500 fewer owner households in the city with a mortgage in 2019 than there had been in 2010.
The study found that housing being built in Oklahoma City may not be meeting the needs for more diverse housing types, including minorities. Authors of the study also wrote that the housing system, which includes regulators, partnerships, the development industry and lenders, struggle to meet changing housing needs.
Part of the solution, the study suggests, is to increase the amount and diversity of affordable rentals while also keeping existing rental units in good condition.
Cooper-Hart is hopeful city officials can encourage a variety of partners to become engaged in the housing market with everything from financial literacy, counseling and improved tenant rights, which would require state legislative approval. At the same time, the study promoted the idea of encouraging and expanding incentives for developers and builders who would construct new and improved housing projects that would assist low-income residents.
Oklahoma City continues to have a “horribly abusive rental environment” where renters may be evicted and then wind up in a revolving-door scenario requiring social service assistance, the Oklahoma City planner said. As a result, the study’s authors recommended early settlement mediation for renters and landlords, the preservation of affordable housing through major and minor rehabilitation programs, enhanced financial literacy among renters and increased access to small-scale funding for developers.
“Because there are so few protections for renters in the state, the cycle of eviction for the city’s renters can easily repeat itself, which is why Oklahoma City has one of the highest eviction rates in the U.S. Moreover, bad credit history, which can be linked to a household’s rental history, is the primary reason for mortgage loan denial in the city,” the study’s authors wrote.
The study found that rentals in the core center of Oklahoma City are affordable, but rentals elsewhere in the city are not affordable, which is a trend that has continued for the past several decades. Within the last decade, three of every four housing units were built on the city’s periphery. The market has also continued a pattern of delivering little variety of housing product, in which three of every four new units was a three or four-bedroom single-family home.
“We need diverse housing and rentals that are affordable,” Cooper-Hart said. “There are actions that can be taken to keep things from getting worse. People need to pick their passion, pick their partners and their funding. We need to make this less severe. Ten years from now, we’ll ask ‘did we move the needle.’ We have our work cut out for us.”
Meanwhile, an economic and resiliency study conducted by Ernst & Young shows ways Oklahoma City can enhance its economy and build the number of minority-based businesses with financing methods.
The study showed Blacks comprise 13% of the city’s population but own only 2% of the businesses. Latinos also are under-represented in business ownership with 21% of the population and 5% of business ownership.
As a result, the Ernst & Young analysis suggested using a variety of financing schemes to overcome the racial barriers including the use of the Grow America Fund Program, revolving loan funds, subcontractor’s fund and flexible financing fund for developers. Other financing could include the community development venture capital fund, leveraged debt pool for local businesses and entrepreneurs of color and a small business lending fund.
Oklahoma City’s efforts should be directed toward programs and initiatives designed to provide direct support to aspiring entrepreneurs, small business owners and real estate developers with a focus on providing service to historically disadvantaged population, the study asserts.
Note: Independent Tim Farley is an award-winning reporter whose career includes a stint at The Oklahoman. He now writes often for The City Sentinel newspaper, both in print and online.