A few days ago, Sacramento city officials announced that they will float a $25 million bond and loan the proceeds to the 55-year-old complex’s owner, Bayside Communities of Walnut Creek, to finance a $28 million rehabilitation project.
“It’s very important we preserve our affordable housing stock, or we could lose it,” Christine Weichert, the assistant director of Sacramento’s Housing and Redevelopment Agency, told the Sacramento Bee.
Residents of Cascade Village, whose rent payments are subsidized by the federal government, will be moved into temporary quarters while their apartments, about 750 square feet each, are spiffed up with remodeled kitchens and bathrooms and new appliances, plus handicapped access.
That’s good news for them, certainly, but it raises a serious issue: Why is it costing so bloody much?
That $28 million works out to $378,000 per unit, which happens to be somewhat higher than the median price of a single-family home in the Sacramento area that would be much larger than a Cascade Village unit, plus have a garage and a yard.
Other comparisons only deepen the mystery. A quick check of real estate listings reveals many refurbished, ready-to-occupy single-family homes in Cascade Village’s Avondale neighborhood, each well over 1,000 square feet, for about $250,000.
To put that in another context, Sacramento’s $25 million bond would fully purchase homes for 100 families — a third more than the 74 families now living in Cascade Village. Or one could compare the price of rehabbing Cascade to other apartment complexes now for sale in Sacramento. Many are under $200,000 a unit and very nice ones in very nice neighborhoods can be had for about $250,000 a unit.
Still another comparison: The $378,000 per unit price tag for rehabbing Cascade Village is more than the state’s estimate of the average cost of building “affordable” housing from scratch.
This is not a new issue. Yours truly raised the same point several decades ago when the same agency spent more than $80,000 per room to convert two dilapidated downtown hotels into a “single room occupancy” complex for low-income adults. At the time, that was more than the average price of multi-room apartments for sale in Sacramento.