Kyle Isacksen has many irons in the fire. Driven by a direct action philosophy, his work throughout the community has blossomed in many directions. Together with his wife, he runs the nonprofit Be The Change Reno , an urban learning space dedicated to service, sustainability, and uplifting the community. One of the projects Isacksen is responsible for is addressing the affordable housing crisis in Reno.

“People aren’t connected to a place where they have less skin in the game,” explained Isacksen.

He feels the recent population flux has created a footloose community. With Panasonic and Tesla opening jobs in the region, more people are moving from out of state to the region.

“All that stuff just ripples through the community and leads to a weaker kind of social fabric,” Isacksen said.

So, a few years ago, Isacksen built a sustainable home on a plot of land he owned in the heart of town. This two-bedroom home is part of Reno’s second community land trust project, a model to make affordable housing and home ownership a reality for low-income families.

The cost of the land is taken out of the home price and put into a trust, which ensures the land will remain affordable indefinitely. This gives people a stronger chance at owning a home, and Isacksen believes it’s part of a broader solution.

Isacksen and his wife, Katie Isacksen-Chandler, acquired the property in 2015. Kyle used locally sourced and milled lumber as the home siding, giving it a unique log cabin feel, while Katie established a large, productive organic garden just steps from the spacious front porch. The garden is now operated by Soil Solidarity , a collection of people creating a sustainable and equitable world through direct action centered on food and housing justice. This type of interconnectedness is something large housing development projects lack.

“I really think the federal government needs to take a big role in promoting and encouraging affordable housing on a huge scale,” said Kyle Isacksen-Chandler.

The Housing Problem

The U.S. Department of Housing and Urban Development (HUD) considers any household that spends more than 30% of its income on housing to be “cost-burdened.” According to the Pew Research Center , nearly half of renters across the country are cost-burdened based on this metric.

In Reno, about half of the housing inventory is occupied by renters, leaving many in the Truckee Meadows at the whim of the rental market, which has seen dramatic increases in costs over the past several years. That same Pew Research study shows that in Nevada, more than half of renters are cost-burdened.

“Unaffordability used to be a largely coastal phenomena, now it is spread across the U.S.,” said Edward Glacier, a professor of economics at Stanford University.

Glacier said the driving force is a lack of supply. His research has found that permits to build new housing are lower than in the 1980s and 1990s and far below the level of new home construction before the Great Recession. According to the U.S. Census Bureau’s Survey of Construction , housing units “start” for homes under 1,400 square feet fell from 2.07 million in 2005 to 1.35 million in September of this year.

“[Low supply makes] it much too difficult to add density, much too difficult to build up,” said Glacier.

Glacier argues that extensive regulations are one reason for the decline in new home construction. Reno Mayor Hillary Schieve agrees with that sentiment. She recently told Business Insider that loosening regulations on new home construction could spur increased supply. Building up is often the best-case solution for urban areas with little land left to sprawl.

Yet, home prices are still climbing as the city and county rush to permit new construction and bring the supply back up. The median price for a home has steadily remained over half a million dollars for several months. For a $500,000 home, a family with a 20% down payment ($100,000) would owe around $2,800 a month on a mortgage, meaning they would need to make a gross household income of $11,000 a month ($9,333 net), or $132,000 a year ($112,000 net) not to be considered cost-burdened.

Editor’s Note: These numbers are estimates based on an effective tax rate of 15.2%. These numbers would vary among people and households.

The affordable housing crisis is worsening. This price tag has kept many families from purchasing that starter home to begin building wealth and a semblance of financial security. Business Insider recently reported that nationwide, home prices have nearly doubled over the past seven years and rents have increased more than 50%.

Greenstreet Development is a multifamily developer in Reno building both market rate and affordable apartments. They have built over 2,500 affordable units in Washoe County including Reno and Sparks. Dane Hillyard is the co-founder of the company.

“There are federal tax credits created based on the eligible basis cost of the project,” Hillyard said. “This generates equity for the project only available to affordable projects.”

These incentives are bound to maintain 30-year affordability and provide rent based on renters earning no more than 60% of the median income. But there are hurdles for developers. For one, land. Reno and Sparks have limited land for new development. As supply shrinks, land costs begin to climb, making affordable housing projects cost more.

“Impact fees, neighborhood opposition, high construction costs, often lengthy and difficult approval processes at the local level,” Hillyard said are also challenges for developers to build affordable housing.

Yet, affordable housing projects can be financially viable for developers across the country. If a proposed project is in a location that HUD determines as a qualified census tract, developers can tap into a world of incentives to make the project viable, as long as market rents are higher than what is deemed affordable.

However, it’s not as simple as just building more houses. It is more affordable for a construction company to build a single-family home than a multi-family unit several stories tall. As more single homes are built, there becomes a bottleneck in supply, the land is not being used efficiently, and affordable housing becomes harder to attain. However, multi-family units can pass the elevated construction costs onto the renter.

Reno is looking toward partnerships with land developers to build its affordable housing fund. Essentially, the city is agreeing to reduce certain barriers to development in exchange for “affordable housing contribution agreements that will provide monetary contributions on a per-door basis as projects develop,” explained the Director of Housing and Neighborhood Development for Reno, Monica Kirch.

The city has codified standards to reduce or waive building permits and sewer hookup fees for affordable housing projects as long as developers agree to add funds to an affordable housing fund. Kirch said that so far, six development projects have included this affordable housing contribution agreement, including those to support homeless residents, seniors, and people with disabilities.

“The connection fees are around $10,000 per door and so in those developments, it was about 2,100 new units that came on,” she said.

Additionally, the city has created a fund that is managed by the Community Foundation. The six affordable housing development projects that have included the affordable housing contribution agreement have produced $4 million in additional funds from developers to support affordable housing projects. Developers can opt into this fund if they want to when filing for permits with the city.

“Say they agreed to pay a certain amount per door to go into an affordable housing fund that would help with affordable housing initiatives, once we reach a benchmark there, then the City Council will decide in what way they want to utilize those funds for that initiative,” Kirch explained.

No developments or decisions have been made at this time on what to do with the current funds raised.

These projects are helping with supply; however, the pace has not kept up with the surge in population.

Dr. Anthony Orlando is an assistant professor in the finance, real estate, and law department at California State Polytechnic University, Pomona. His research revolves around housing finance and supply, and he found that more people are falling into the cost-burdened category.

“Research has shown that when people spend more than 30% of their income on housing, they have to cut back on basic necessities,” said Orlando. “A record number of renters, literally half of them throughout the country, are spending that, and relatedly, a record number of Americans are experiencing homelessness.”

While addressing the affordable housing crisis in today’s economy is no easy feat, there are things beyond deregulation and incentives for developers that could go a long way. Land is an expensive part of the overall cost of a home. What if the land cost was removed from the home-buying equation?

The Land Trust Solution

Kyle Isacksen knows his land trust housing idea is a tough sell in today’s political climate, but he believes its effects would be far-reaching and impact the affordable housing crisis. When housing is a commodity, home prices will remain above profitable margins.

“When you make it a for profit thing and everything goes towards making money off of it, then that’s gonna make it hard for a lot of people,” explained Isacksen. Instead, he suggests, “Let’s make it a public works project [and] get people engaged.”

Isacken said this alternative makes home ownership more possible for people and believes the government should play a more direct role in the crisis and help promote this program.

“You can have high schoolers doing this for part of their skill sets,” he said.

This idea, he said, could easily be a national program that involves local communities and provides quality, low cost housing and starter homes.

When land costs are separated from the cost of a home and put into a nonprofit, it lowers the overall cost of the house, which is why he was drawn to a community housing land trust to begin with. It also gives communities another tool in the toolbox. A city or county mandate to require developers to build so many affordable housing units could also help change the development mindset.

The city has a few land trust housing projects in place and currently is developing a model in Golden Valley. There is a parcel of land that has been moved to a land trust but developing it has been a challenge. Kirch said the city is looking at a prefab (prefabricated home) model and has applied for a grant to spur development on that parcel.

“A very large percentage of homeowners that start with their first house in that model move on to buy a house where they own the land,” Kirch said.

The land trust model for home ownership is a successful option and it is recyclable.

“The house gets sold again, because they’re sold again to another qualified buyer, because there’s a certain amount of equity that they can take out. And then, it needs to qualify again,” Kirch said.

For Kyle Isacksen, he believes this more public-private partnership approach is a more holistic strategy toward dignified housing.

“Housing would be more of a human right that also greatly includes how it impacts the environment,” he said. “It’s just better for people.”

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