Blog

Zillow study shows growing support for ‘middle housing’

A Zillow survey found growing support for “middle housing” like duplexes and small apartments, especially accessory dwelling units. Despite a housing shortage, modest densification could increase supply and slow price growth. Support for more home types remains high among renters and is steadily growing for homeowners since 2019. Renters consistently support allowing multifamily housing, while homeowner support has increased from 57% in 2019 to 73% in 2024. LBMJournal.

County developer modifies previous plan to add new apartments on contentious Lutherville land

A developer in Lutherville, Maryland has modified a plan to add 560 new apartments near a light rail station, taking advantage of a new state law. The plan faces opposition from some residents concerned about increased traffic and overcrowding, but the developer argues it would create a vibrant, walkable community. The county is balancing housing needs with community concerns, and the project still requires approval. TheBaltimoreBanner.

Age Waves: How Demographic Shifts Are Reshaping Housing Demand

Demographic shifts are transforming U.S. housing demand, with the market projected to reach $5.85 trillion by 2030, largely due to a 47% increase in the senior population by 2050. Rising living costs are extending rental periods for young adults and increasing single-person households. Demand for single-family rentals (SFRs) and manufactured housing is growing, while student housing may struggle with a shrinking college-age demographic. BisNow.

Maryland Department of Housing and Community Development Prepares Partners for Implementation of New Laws that Address Housing Affordability

The Maryland Department of Housing and Community Development has launched the Turning the Key campaign to provide guidance and resources on new housing laws signed by Governor Wes Moore. The department has developed webinars, FAQs, and materials to ensure smooth implementation of laws addressing affordability, renter protection, and community development. News.Maryland.

Investor Share of Home Purchases Close to Record

Investors are purchasing a larger share of U.S. homes, with 16.8% of homes bought by investors in the second quarter, the highest second-quarter share on record aside from 2022. While overall home purchases fell 1.9% due to high mortgage rates and prices, investor home purchases rose 3.4%. Investors purchased $43 billion worth of homes in the second quarter, a two-year high, indicating a market stabilization following dramatic fluctuations during the pandemic. Globest.

Inflation Falls Below 3% Amid Persistent Housing Costs

Inflation has fallen below 3% annualized growth, but housing costs continue to rise, contributing significantly to overall inflation. The Federal Reserve is likely to consider rate cuts to ease pressure on the housing market, but its ability to address rising housing costs is limited due to supply and development issues. The NAHB forecast expects to see shelter costs decline in the coming months. NAHB.

NAHB Commends Vice President Harris’s Focus on Boosting Housing Production

NAHB commends VP Harris’s housing plan to boost production, but is concerned it lacks solutions for regulations and the built-for-rent market. NAHB’s 10-point plan aims to remove supply barriers, and the organization looks forward to working with lawmakers on policies to increase housing. NAHB.

Thrive Senior Living Breaks Ground on 75-Unit Encore at Heritage-Glen in Fort Worth, Texas

Thrive Senior Living and Orison Holdings have officially started construction on Encore at Heritage-Glen in Fort Worth, Texas. This new development, designed by Arrive Architecture Group, will comprise 50 assisted living units and 25 memory care units. The project is situated in the Alliance area of North Fort Worth. This groundbreaking event comes shortly after the announcement of Thrive Senior Living’s latest venture, the International at Aventura, located in Florida. SeniorsHousingBusiness.

Biden Investing $100M to Spur Housing Construction

The Biden administration announced a $100 million investment to combat barriers to affordable housing construction through a new grant program. The program will provide funding to state and local governments and other entities to develop and implement plans to facilitate affordable housing production.

This funding was made possible by a bipartisan government package, and the administration has prioritized increasing the nation’s housing supply. The second round of the program will target communities with acute affordable housing needs that have already shown a commitment to overcoming local barriers. Housing affordability has emerged as a key issue for voters, especially younger generations, ahead of the upcoming elections. TheHill.

Maryland Housing Market 2024: Trends & House Prices

The Maryland housing market continues to see rising home prices, with prices up 2.5% per quarter on average, despite a slight slowdown in the market. Inventory is declining, and homes are selling quickly, often within a week, driven by steady demand from government workers and military personnel. While some homes are still selling above list price, the state is working to make homeownership more affordable through various assistance programs. Analysts predict the Maryland housing market will remain strong, with low inventory and stable or rising prices, though potential buyers may face affordability challenges. Overall, the Maryland housing market favors sellers, but buyers have options to help offset the impact of high interest rates. Forbes.

An Unexpected Barrier to Affordable Housing

The affordable housing crisis in the nation is well-known, and real estate developers and planners are eager to address the issue. However, one of the main challenges they face is not financing or construction but gaining community support for their projects. According to a survey conducted by coUrbanize, two-thirds of developers and planners stated that their most active projects in the next six months will be building affordable and supportive housing. Despite 94% of respondents attempting to gain community input and support through public meetings, many were frustrated by low attendance and lack of productivity. The greatest barrier to engagement, as identified by 60% of respondents, was the lack of staff time. Globest.

Renting Now Beats Buying in All Major US Cities

The latest Realtor.com Rental Report reveals that renting a starter home has become more financially advantageous than buying in all 50 largest metropolitan areas in the United States, driven by elevated mortgage rates, high home prices, and a decline in rents. On average, renting a starter home is $1,067 per month, less expensive than buying, with cities like Austin, Texas, Seattle, Los Angeles, San Francisco, and New York seeing the most significant savings for renters. While renting remains more economical overall, the advantage is beginning to diminish in some areas as home prices and affordability improve, but certain markets like Memphis and Birmingham have become more rent-favoring due to increased investor activity. Globest.

Carroll County Continues Efforts for Job Creation, with $150,000 Allocated

Carroll County’s unemployment rate is currently at a low of 2.7%, but officials are still working to attract new businesses and create more jobs for its residents. The Board of Carroll County Commissioners recently approved the allocation of $150,000 toward business expansion and new job creation. Denise Beaver, the director of the county’s Department of Economic Development, commented on the funding, indicating that the county is committed to ongoing efforts to support economic growth and job opportunities. This initiative reflects the county’s proactive approach to maintaining a thriving local economy and providing employment options for its community. TheBaltimoreSun.

Bipartisan Bills Recently Introduced in Congress Would Turn Distressed and Vacant Commercial Real Estate into Affordable Housing

Bipartisan bills in Congress would create a federal tax credit to convert underused commercial properties into affordable housing, addressing vacant spaces and the housing crisis. The $15 billion program would cover up to 20% of conversion costs, with extra incentives for economically distressed areas. The credit is designed to work with existing affordable and historic tax credits to make conversions viable. While the bill has broad support, historic tax credit stakeholders have some concerns. The legislation is unlikely to pass this year but has a good chance in 2025. Novogradac.

How Much Are Rents Going Up? See How Prices Have Changed In Your Area.

Rental prices nationwide have cooled off, with smaller year-over-year increases, as new housing construction finally hits the market.
However, costs remain high in many areas, straining renters’ budgets, especially in the Sun Belt and Northeast regions. The Biden administration has proposed capping rent increases, but the broader market slowdown’s longevity is uncertain. Read Full Article

The Share Of Young Adults Living At Home Continues To Rise

More young adults are finding themselves nestled back in the family home, with a whopping 17% of 25-35-year-olds now living with their parents – a drastic increase from just 7% in 1970. This phenomenon is driven by the skyrocketing costs of housing, forcing many to roost at home well into their thirties, despite stories of children eager to flee the nest.
The trend is widespread across the country and impacts both college-educated and non-college individuals. As the financial challenges of adulthood mount, the traditional path of independence is becoming increasingly elusive for this generation. Read Full Article.

The Cities Where 20-Somethings Are Still Getting Hired

Southern cities like Raleigh, Austin, and Atlanta are emerging as top destinations for 20-somethings seeking entry-level jobs with good salaries and affordable living, offering a combination of brisk hiring, cost-of-living-adjusted wages, and a concentration of industries like technology, healthcare, and finance.
In contrast, cities like Salt Lake City, Seattle, and Portland are lagging behind due to slower hiring rates and lower wages when factoring in the cost of living, as employers scale back white-collar hiring and invest more in artificial intelligence.
Young professionals are drawn to the energy, social offerings, and more affordable cost of living in these Southern cities, with hubs like Charlotte and Austin becoming magnets for recent graduates looking to thrive rather than just survive. Read Full Article.

Lenders Turn Up The Foreclosure Heat On CRE

Despite warnings of a looming commercial real estate (CRE) crisis, smaller banks have largely avoided major issues. They tend to focus on suburban office and local business properties that have held up better than the troubled big-city office market. While some banks are reducing CRE exposure, they are not lending as much, creating an opportunity for private credit providers to step in with more expensive financing. Read Full Article.

Lenders Turn Up The Foreclosure Heat On CRE

Lenders are tightening their grip on the commercial real estate (CRE) market as borrowers struggle to meet their obligations, leading to a surge in foreclosure activity. Analysts have been closely monitoring the status of CRE loans, including CMBS, bank loans, and properties in special servicing, revealing a concerning trend of delinquencies.
Banks have been accused of “extend and pretend” practices, with estimates suggesting that 40% of CRE loans maturing this year are actually from 2023, and banks are reserving five times more than normal for their CRE portfolios.

The real impact is being felt on the ground, as lenders are increasingly taking back properties, either due to borrowers walking away or through the foreclosure process. This escalating foreclosure activity in the CRE market is a clear sign of the financial strain faced by both borrowers and lenders, with potential ripple effects across the broader economy. Read Full Article.

Four Decades to Build 70,000 Affordable Homes? Count That as a Success.

In 1975, New Jersey’s Supreme Court ordered every town in the state to make way for multifamily housing. It’s been a long journey. Read the full article here.

Silver Spring’s Once-Vibrant Downtown Is Stuck In The Past

In late October, Denizens Brewing in Silver Spring poured its last beer of the night for the final time. The suburban Maryland staple had served craft brews for a decade, but when its lease came due, founder Julie Verratti decided she wasn’t willing to commit to another 10 years.
She says her decision to close was fueled by uncertainty — about the neighborhood, about the economy and about consumer behavior. Her uncertainty is a symptom of a larger plague spreading across Silver Spring, where a once-vibrant downtown commercial district is now lined with vacant storefronts and half-empty office buildings. (Full Article).

Gen Z Is Staying In Apartments Longer. Young Developers Might Have A Leg Up In Catering To Their Peers

Jamauri Bogan, a 28-year-old developer in Kalamazoo, Michigan, has a pretty simple strategy for finding out what young apartment tenants want. He calls his friends.
Although the college running back-turned-multifamily developer hopes to avoid calls from his friends about broken sinks and other snafus at his properties, Bogan welcomes feedback about the next steps for his business. Read here.

Lowe’s Foundation Makes Another Big Investment in Skilled Trades Training

The Lowe’s Foundation recently announced nearly $8 million in Gable Grants to a second cohort of community and technical colleges. Since awarding its first grants one year ago, the foundation has assisted in expanding skilled trades career pathways through its growing network of 35 community colleges and nonprofits in rural and urban communities across 27 states. Read Full Article.

Developers break ground on affordable housing project on East Patrick Street

A developer has broken ground on a new affordable-housing development on East Patrick Street. The development, called Overlook East, will include 85 units across three buildings and have capacity for more than 300 people. Scheduled to open in late 2025, it is meant to serve people and families making up to 60% of the area median income. Read more.

The Next Real Estate Trend: ‘Silver Squatters’?

Middle-aged Americans, part of Generation X, say they will need to rely on family for housing help in retirement (but they haven’t told them yet!). Young adult children have spent years relying on funding from the Bank of Mom and Dad, and now their parents say they may soon need to mooch off of them. Read the full article here.

Election-Year Uncertainty Slowing Affordable Housing’s Progress, Advocates Say

Although affordable housing has gained a previously unheard-of amount of visibility at the federal level over the last few years, the realities of Washington, D.C., are tossing cold water on activists’ hopes for quicker change.
The increased attention has not yet translated into action on the bold changes to the funding, creation and preservation of affordable housing nationwide that the sector needs. And with a looming election taking up all the air in most rooms, the wait is likely to stretch even longer. Read more.

Billions In New Investment Could Put Baltimore Back On The Map

Baltimore is undergoing a significant transformation with billions in investments aimed at revitalizing the city. Key projects include a $500 million redevelopment of the Inner Harbor, major stadium renovations, and the $5.5 billion Baltimore Peninsula project. These developments are expected to attract investors, residents, and tourists, but also bring challenges such as housing affordability and congestion. City leaders emphasize the need for new housing and improved public transit to sustain growth and maintain Baltimore’s unique identity (Bisnow).

Housing starts fall to a four-year low

U.S. housing starts have plummeted to a four-year low, signaling potential trouble ahead for the real estate market. The sharp decline in new construction is attributed to rising interest rates, economic uncertainty, and higher material costs. This downturn could impact home affordability and availability, making it a critical moment for prospective buyers and investors to stay informed. (Bisnow).

Input wanted from Carroll residents on affordable and safe housing

Carroll County officials are seeking resident input to improve affordable and safe housing in the area. They are conducting a survey to gather community feedback on housing needs and challenges, aiming to develop better policies. Residents are encouraged to share their experiences and suggestions to help shape future housing strategies.
For more details and to participate in the survey, read the full article on the Baltimore Sun’s website here.

BoA Has Grim News for Homebuyers

Bank of America warns that the U.S. housing market faces prolonged challenges, predicting high prices, limited inventory, and persistently high mortgage rates until at least 2026. Despite slight recent declines in mortgage rates, economists see no immediate solutions, emphasizing that these issues will take years to resolve. Prospective homebuyers should brace for continued market difficulties and limited affordability. Read more about the implications for the housing market and potential strategies for buyers in the full article (Globest).

Four Key Findings From the 2024 State of the Nation’s Housing Report

The 2024 State of the Nation’s Housing report reveals persistent and widespread cost burdens, with 50% of renters spending over 30% of their income on housing. The U.S. faces a significant housing shortage, with rising costs and limited inventory hindering both rentals and homeownership. Federal rental assistance is lagging, covering only 25% of eligible households. Additionally, the nation’s housing stock is increasingly vulnerable to climate risks. Addressing these issues requires substantial public and private sector investment and innovative solutions. Read the full article here.

Dear Friends of Warfield:

On March 26, 2024, the five entities owning the various properties comprising Warfield at Historic Sykesville filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court. Under Chapter 11 protection, Warfield Companies will continue normal operations, which consists mainly of pursuing the development of Warfield’s vacant parcels and, most importantly, the rehabilitation of the project’s vacant buildings. Vendors and contractors will continue to be paid for work performed post-petition in connection with the project.  
 
The Chapter 11 filing was a direct response to the Town of Sykesville’s actions to take back ownership of the property after selling it to the developer in 2018. These actions most recently included an attempt to foreclose on the property and began in earnest last spring when the town filed lawsuits against Warfield entities in state court to wrest control of the project’s historic buildings from the owner. The town left the developer no other option but to file for Chapter 11 to protect its substantial investment in the Warfield project.
 
The developer currently has over $6 million invested in the project and has cumulatively invested over $14 million, and, subject to court approval, it will continue to fund the project while in Chapter 11 and beyond. In addition to making major capital investments, the developer has worked tirelessly to pursue the state’s original vision for the Warfield property when it was transferred to the town in 2002. This includes taking steps to make the project financially viable and attractive for both private and public investment, which is essential to preserving and putting back into service Warfield’s historic buildings, not to mention achieving the “smart growth” goals set forth in the Town of Sykesville’s original agreement with the state. 
 
It is important to distinguish between Chapter 7 and Chapter 11 bankruptcy. Chapter 7 is a liquidation, which is different from what the developer is pursuing here. Chapter 11 bankruptcy protection will allow Warfield to defend itself from the town’s continued attacks and reorganize while continuing to operate. We expect to file a timely reorganization plan with the court that will enable us to continue pursuing our vision for the project and pay all creditors in full.
 
Please contact Steve McCleaf at 571-215-0000 or send an email to smccleaf@langleyrealtypartners.com should you have any questions or concerns. 
 
Regards, 

WARFIELD COMPANIES

Steven D. McCleaf
Senior Vice President

Gov. Wes Moore and housing secretary Jake Day: Maryland is facing a crisis; now is the time to take action | COMMENTARY

By WES MOORE and JAKE DAY – PUBLISHED: January 9, 2024 at 12:00 p.m. | UPDATED: January 9, 2024 at 12:02 p.m.

Originally published in by Sherry Greenfield Carroll County Times • Last Updated: Sep 04, 2023 at 12:27 pm

The Town of Sykesville and Warfield Historic Properties LLC continue to be embroiled in legal disputes, the first of which was filed in December 2021, and the most recent on Aug. 18.

Warfield, developer of Warfield at Historic Sykesville, a mixed-use housing and commercial development on Route 32, filed a counterclaim in the Circuit Court of Carroll County on Aug. 18, in response to the town’s June lawsuit, alleging that Warfield has made little or no progress in preserving and reusing nine historic buildings at the site for affordable housing, which it agreed to do when the property was purchased in 2018.

The town is asking the court to enter a judgment in its favor and against Warfield Historic Properties LLC and Warfield Historic Quad LLC for breach of contract, according to court documents. The town is also asking to be awarded $3 million in damages.

Warfield’s counterclaim states that the town violated its duty of good faith and fair dealing to cooperate with the developers, according to court papers.

“We have not abandoned a workforce housing project for the historic buildings at Warfield, but the town’s lawsuit and its subversion of our efforts in the past have put this part of the project — admittedly the most important part — on hold,” Steven McCleaf, president of Langley Realty Partners, LLC, which oversees the day-to-day operations of Warfield at Historic Sykesville, said in an email on Friday.

McCleaf said the company spent $8.2 million to purchase the property, helping to resolve more than $5 million in town debt related to Sykesville’s “failed effort” at Warfield, and has invested “millions” since closing on the property in 2018.

“Town leadership has actively disrupted millions in additional investment by disparaging the developer both publicly and in private with capital partners, contractors, and consultants,” he said. “In addition, town leadership has consistently refused to meet with the developer to discuss commercially reasonable proposals for the future of Warfield and has rejected mediation.”

McCleaf said the town’s denial of due process, and the lawsuits, indicated Mayor Stacy Link’s sole intent is to seize control of the property, and put at risk more than $30 million in state and federal incentives needed to make Warfield viable.

“The town owned the property for 16 years and failed in its efforts to rescue Warfield’s historic buildings or to create an economically viable project — going millions into debt in the process,” he said. “The town’s lawsuit is misguided. It is a recipe for disaster.”

Link issued her own statement Friday in response to Warfield’s countersuit.

“A party may assert as a counterclaim any claim that party has against any opposing party, whether or not arising out of the transaction or occurrence that is the subject matter of the opposing party’s claim,” Link said. “That’s exactly what they’ve done here. Besides its contents having nothing to do with the town’s original filing, which is merely an exercise in accountability to the preservation agreement, the counter claim lacks merit.”

Link is out of the country and issued her statement through email.

Click here to read the article.

Staff Commentary

Originally published in the Baltimore Sun by Dan Rodricks • Aug 25, 2023 at 12:50 pm 

If he can find time, Gov. Wes Moore might want to take a ride to Sykesville to deploy his big smile, positive nature and power of persuasion to resolve a bitter dispute between the Carroll County town and a developer. I mean, why not? There’s a legitimate place for the Maryland governor or his housing secretary in the Sykesville mess.

The state still has an interest in what happens on the grounds of the old Springfield Hospital Center, a Maryland institution that once housed and treated people with mental disorders.

Under a previous governor, Parris Glendening, the state conveyed a large parcel of Springfield, known as the Warfield complex, to the town. That happened in 2002, with a disposition agreement that emphasized the Smart Growth ideals Glendening championed during his two terms in Annapolis.

The agreement noted Sykesville’s desire to redevelop Warfield as “principally an employment center/office park,” but it allowed for other uses as well, including residential development that would accommodate people of different income levels.

I mention that because housing is central to the dispute between Sykesville and Warfield Historic Properties LLC, the group that paid the town $8.2 million for the parcel in 2018.
The development, Warfield at Historic Sykesville, prioritized the restoration of 19th-century buildings on the property and the development of office and retail space and townhomes.

But then came the COVID-19 pandemic.

The market for new office buildings and retail space dried up while the need for affordable housing, or workforce housing, grew.

In December 2021, the Warfield group requested permission to build less commercial space and more affordable workforce housing. That’s where things got messy.

A hearing in May 2022 on the developer’s request produced the tired, coded claims that workforce housing would change the “character of the community” and lead to more crime. A former Sykesville mayor warned that outsiders with federal housing vouchers — he actually referred to them as “those people” — would be “coming to our schools and our towns.”

For Timothy Maloney, the attorney representing the developer, that sentiment reflects the reason the town wants to now reclaim the historic Warfield properties from his client.
“‘Those people’ are precisely who the town leadership seeks to exclude from living at Warfield,” he says. “It’s why they are willing to walk away from $30 million in federal and state tax credits for housing and revitalization. And it’s why they are trying to take the property back — to keep ‘those people’ out of Sykesville. Sad to say, it’s the driving force behind all of this.” Mayor Stacy Link disagrees. “The Town would welcome affordable housing if it were proposed in a thoughtful, well-planned development,” she wrote in an email. “The plan the developers showed creates pockets of different housing types with the affordable component pushed to the back of the property instead of being incorporated throughout an accessible and inclusive mixed-use development. Our main issue was with the design of the project and its purely residential concept.”
Link said the town plans to address affordable housing in other ways, through “inclusionary zoning practices and relaxed regulations on accessory dwelling units,” the latter the subject of my Aug. 25 column.

But Steven McCleaf, a principal in the Warfield group, is not convinced. “Affordable housing of any kind was certainly not a pillar of the platform of either Mayor Link or her predecessor,” he says. “Despite a well- demonstrated shortage of affordable housing, the town has failed for decades to address the issue.”

On June 9, 2022, Ken Holt, in his final year as Secretary of Housing and Community Development, convened a meeting at Sykesville Town Hall to try and get local officials and the developers to work toward a resolution. It failed.

“The town never would even discuss a different range of housing mixes,” McCleaf says. “They essentially shut down communication with us.” Two weeks later, the Sykesville Town Council rejected the developer’s request for more affordable housing. Then, in May of this year, the town took steps to reclaim property from the Warfield group, charging that
the developer had failed to pay for the agreed-upon stabilization and preservation of nine historic buildings.

“This inaction,” said Sykesville Town Manager Joe Cosentini, “leaves the Town with two options: continue watching the buildings be demolished by neglect until they can no longer be saved or exercise the remedies available to the Town from the original sales contract, including reversion of the historic buildings to theTown’s ownership. The Town has chosen the latter.” Maloney filed a counterclaim, charging that Sykesville officials acted in bad faith with his client, and seeking damages. His filing says the town’s motivation for taking the property back is “opposition to affordable housing and animus toward residents of affordable housing.”

More than 140 houses, priced between $300,000 and more than $500,000, are mostly completed and already sold, and McCleaf vows to continue working on some elements of the project.
But litigation over the historic buildings has scuttled the partnership’s plan for workforce housing. Maloney says no other developer or lender would touch a project focused on office, commercial and retail space. “And residential development,” he says, “requires the kind of substantial support that the state was willing to provide.”

The relationship between the town and the Warfield group might have become too bitter to be saved. But, given the state’s historic interest in the place and the need for affordable housing, the governor might want to offer personal mediation. I mean, why not?

Click here to read the article