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Closer Look: Private sector helps with boom of affordable housing

By  Naomi Creason

This article was published on Cumberlink.com on April 17, 2016.

There may be no new developments in public housing, but Cumberland County has seen a number of developers submit plans for affordable housing in the last few years.

While public housing shelters those who are considered to have extremely low incomes—about 30 percent of the annual median income in the county—affordable housing tends to house tenants who have 50 percent or above of the median income.

With the Low-Income Housing Tax Credit program from the Internal Revenue Service, private developers can develop affordable housing properties.

And there are quite a few developers who specialize in just that type of property.


The Woda Group of Ohio recently finished construction on the Dawn Ridge development behind Giant Food Stores in Carlisle after a few years in development. Ohio-based PIRHL likewise specializes in affordable housing and is eyeing the former Carlisle Tire & Wheel site for a new development.

Monarch Development is based locally in Lower Allen Township and like the other two firms, specializes in affordable housing development. Among its portfolio of all Pennsylvania locations is the affordable housing townhouse development, Shepherd’s Crossing, located off the Carlisle Pike and Lambs Gap Road in Hampden Township.

Development Director Brandon Johnson explained that there are methods for choosing these sites for affordable housing.

“There are a variety of methods (for site selection). We look to see if there is great access to amenities, employment and transportation,” he said, noting that, like any developer, it will also consider topographical and environmental issues.

Shepherd’s Crossing fit the ideal location with its position off Lambs Gap Road and the Carlisle Pike in Hampden. The site gives residents access to what is available on the pike, and also provides housing for workers at some of the nearby businesses who only make minimum wage.

“When employers look at site selection for their businesses, they concentrate their workforce within a 10-mile radius of the site,” explained Jonathan Bowser, CEO of the Cumberland Area Economic Development Corporation. “With increased demand in sectors such as food processing, transportation and logistics, health care and financial services, there is a demand for more market rate rental units and townhouses, in addition, first-time homebuyers seeking affordable housing options.”

Because of the relatively low prices for the rental units, Johnson said Monarch tends to fill its developments quickly.

“We fill our units very, very quickly,” he said. “That deal (at Shepherd’s Crossing) got our last certificate of occupancy in October … and we completed (wrap-up) in November. We were fully filled by the end of December. We had hundreds of phone calls, about 200 applications. In January, we had a wait list of 75 to 90 people. It’ll be quite a while to get through that.”

Real estate market

Given the wait list for affordable housing units, developers and property managers have almost an insured income stream from its tenants and partially from federal government subsidies since qualified tenants can use housing choice vouchers on these rentals.

Because of that, some argue that the real estate market suffers with the addition of affordable housing, with other property owners unable to compete with the same rental rates.

Though public and affordable housing is meant as a first step to offer stability to a household that could lead to the purchase of a home and a better paying job, Johnson noted that turnover is not especially high with Monarch’s units because they are so affordable compared to the area.

“Because rents are capped, we almost always have the rental advantage against the market,” he said. “It’s a great place to live compared to what else is out there. It’s the best option if they were able to qualify.”

Johnson noted that the tax credit program provides rental affordable housing for those with up to 60 percent of the annual median income at move-in, so a person can stay even after their wage increases passes the limit.

Cindy Daley, policy director for the Housing Alliance of Pennsylvania, said public and affordable housing does not decrease property value and, for the most part, doesn’t affect the rental rates, especially in urban areas.

However, she noted that there are some circumstances in rural areas that could lead to higher than usual rental prices. She explained that the U.S. Department of Housing and Urban Development sections off the country into geographic areas for its determination of standard prices and median income.

“If HUD gets too wide of a geographic area, (the more affordable housing) can be higher than the rental rates around it in rural areas,” Daley said, adding that this can be fixed by making the fair market area smaller and taking out the rural community. “I can’t say it never happens, but it doesn’t happen very much. I can certainly understand the frustration for subsidized housing for people who are just above the line. But it’s good for all of us.”

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