Developers want to build new housing near Dix Park. Who’ll get to live there?
Developers will add thousands of new places to live around Dorothea Dix Park, but it’s likely that few of the people who live there now will be able to afford them.
As development begins at Dix Park, Raleigh is studying the southern edge of the 306-acre park — one of the few parts of the city left with naturally occurring affordable housing.
City staff talked about the study during a virtual summit Thursday for affordable housing developers and people who live in the surrounding neighborhoods.
Dieneaker Shaw, one of the study’s two neighborhood ambassadors, said when investors and developers start buying property in the neighborhood, rents go up, people are displaced and families feel “they are not welcome.”
“Low-income families (making) under $30,000 yearly in annual income have lived in the community for several years,” she said. “These families have built a culture and stability for their families. .... Middle-class income residents should not be forced to move to rural areas outside of the beltline.”
Raleigh has struggled with preservation
The Dix Park edge is bordered by Lake Wheeler Road, South Wilmington Street, Western Boulevard, Carolina Pines Avenue and Pecan Road, and includes the Fuller Heights and Caraleigh neighborhoods.
The median household income in the study area, which is racially diverse with a growing Hispanic population, is $39,863
About half of the homes in the area have a tax value under $200,000 making it one of the places in Raleigh where affordable housing occurs without subsidies. The typical home value in the city is $321,559, according to Zillow.
The two ways to address what local leaders call an affordable housing crisis are preservation and new construction, said Gregg Warren, former executive director of DHIC, an affordable housing developer that has built nearly 40 rental communities.
“We need to have both strategies in play here in Raleigh,” he said. “To be honest with you, we are not doing really well on the preservation side of things.”
Affordable and older market-rate apartments are being torn down for more expensive or modern market-rate apartments.
There are 13 new developments planned along or near the park edge that could bring over 5,200 new residential units. A majority will be added as part of the Downtown South development, a planned sports and entertainment district south of downtown and Dix Park.
“New residential development at Park City South and Downtown South will add 4,350 new units to the Dix Edge Study Area,” the presentation stated. “These two projects, and others, will reset the rental housing market in Dix Edge at a much higher level — well beyond the incomes of study area residents.”
‘There is no one solution’
Much of that property in the study area has been bought within the last 10 years — after the 2008 Great Recession and housing crisis and after Raleigh bought the Dix Park land.
Homes have shifted from owner-occupied to renter housing, and some landlords have dozens of properties., the study found.
“What the city has tried to do is track owners with multiple properties,” said Russell Archambault, of RKG Associates. “We have to assume these are investor owners who are either positioning their properties for something larger in the future or they are sort of assembling properties to have an investment portfolio.”
Raleigh and any city’s response to the affordable housing crisis must be multifaceted, said Mark Shelburne, a housing consultant with Novogradac.
“There is no one solution, no one answer to what is truly a market failure,” he said. “The market does not respond to the housing needs of the lowest incomes with anything but substandard structures. That is what we have learned throughout history. ... Subsidies are necessary. Government intervention is necessary.”
Market-rate developers have a role in alleviating housing demand, but they are not the sole solution.
Raleigh could build affordable housing on land it owns or buy land for affordable housing or create a public-private partnership to help create affordable housing, some attendees of the summit said.
The Dix Edge Area Study plans more workshops this summer to understand the needs and wants of the community and to identify strategies, policy changes and funding sources to implement that change. The Raleigh City Council could approve the plan in 2022.
To learn more about the study go to raleighnc.gov/dix-edge. The city is also seeking feedback about transportation, affordable housing and stormwater in the area. Take a survey at https://publicinput.com/Y5054.
This story was originally published March 19, 2021 at 5:40 AM with the headline "Developers want to build new housing near Dix Park. Who’ll get to live there?."
