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The uptick in property values, increase in population, and subsequent lack of available rental units has conspired to create a perfect storm in DeLand that is mirrored not only in nearby cities but across the United States.
The situation has priced even working professionals out of the housing market. Some officials are discussing solutions to the affordability crunch.
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An increase in property values is good for some property owners, but not necessarily for landlords with rental properties. As property taxes rise, without a raise in rents, revenue from rental property decreases.
Combine that with a rise in population — DeLand has added 6,600 residents in the past nine years, according to the latest census data — and finding housing that is affordable, even with a full-time job, can be a challenge.
Many solutions focus on increasing the available housing stock, but the financial numbers might not make sense for a property owner, as construction costs skyrocket and property values increase.
The solution to West Volusia’s housing woes is unlikely to be one magic bullet, local experts, Realtors, and city officials said. Instead, a collection of different private and public mechanisms are needed.
One such mechanism to prompt new investment is a complicated federal tax incentive created by the 2017 tax-cut law, known as “Opportunity Zones.”
Opportunity zones are designed to incentivize development by giving investors breaks on capital-gains tax.
Investors can defer tax owed on other assets they may own, reduce their taxes owed on money invested in the opportunity zone, and avoid capital gains taxes altogether on properties within the zone if they hold their investments for more than 10 years.
The program is supposed to help bridge the gap between the decreasing return on investment that many property owners see over time.
The zones were created through a process of nominations from local officials. In West Volusia, the only existing opportunity zone is in DeLand.
The area, a polygon that roughly encompasses the space between Michigan, Rich and Beresford Avenues from north to south and from Hill to Boundary avenues east to west, is in the heart of the city.
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Government officials aren’t the only ones working on the problem.
One community group active in coming up with solutions is Fighting Against Injustice Towards Harmony (FAITH), a nonprofit that holds an annual community meeting to solicit ideas, traditionally in April.
Among their causes is the lack of affordable housing, and to address it, they’ve settled on a solution: affordable-housing trust funds.
The trust fund would allocate money from the government — most likely county general-fund revenue, FAITH members said — and dedicate it to the preservation and production of affordable housing.
The money put into the fund is designed to be leveraged — to be used to earn other grants and incentives, to ultimately create jobs and economic development.
According to the Sadowski Coalition, a nonpartisan group of statewide organizations focusing on affordable housing, an investment of $1 roughly returns between $6 and $8, depending on whether the fund monies come from the state, county or city.
Florida actually has one existing statewide affordable-housing fund, created by the William E. Sadowski Act, which was passed in 1992.
Commonly referred to as the Sadowski fund, the account has often been drained by state lawmakers seeking monies to shift to balance the budget, according to the group.
More than $2.3 billion has been moved from the fund since the early 2000s, according to estimates from Habitat for Humanity, a nonprofit that constructs and rehabilitates homes.
To fill the gap, FAITH proposes the creation of a localized fund, through Volusia County, that can be tailored to the needs of the community.
There are more than 700 city and county affordable-housing trust funds throughout the United States, but only five in Florida, according to the Housing Trust Fund Project, an advocate group that tracks information on housing trust funds.
But no housing solution locally would be complete without the backing of the City of DeLand.
Since DeLand has committed to The Bridge, a transitional facility now under construction that’s aimed at getting homeless people off the street, they have tied themselves to the need for affordable housing in ways that city governments rarely do.
If successful, between 120 and 360 people a year will graduate from The Bridge and require affordable housing, according to data from The Neighborhood Center of West Volusia.
“It’s usually not a local issue,” DeLand City Manager Michael Pleus said. “[But] if we don’t try to lead on this, I don’t know if anything will be done.”
As the state and the federal government have taken a step back from addressing affordable housing, Pleus said, the city must step up.
“What we can do is incentivize [construction], through development incentives and changes in code,” Pleus said.
Possibilities being considered by the city staff include faster permitting and easing the process for building accessory dwelling units — sometimes known as mother-in-law suites.
For whatever reason, in the early 2000s, DeLand highly regulated construction of such units.
These smaller buildings are often cheaper to live in and maintain than a traditional single-family home. They can also help the owner of the property afford his or her house on the same lot.
To ease the process of building and owning such a unit, the city is contemplating amendments to its land-development regulations.
Among requirements that could be changed is the requirement that the property owner must live on the same property as the accessory dwelling unit being rented out.
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To local contractor Ken Goldberg, there is a greater problem — how the City of DeLand defines a family.
In city code, a family is defined as one of three things: “A natural family of one or more persons who are all related to each other by law, blood, marriage or adoption;” “Six or fewer persons living together in a facility which is licensed by the Department of Children and Family Services;” or “A maximum of two unrelated persons, together with their natural family who are related to each other by law, blood, marriage or adoption.”
“In this day and age, it is not the function of any government, especially the city, to define what a family is,” Goldberg said.
Under the current land-development regulation, the Golden Girls — of the famed sitcom about four women living together — would not be able to rent a single-family home in DeLand, he pointed out.
“As a local contractor, I just think we could provide a lot more housing opportunities,” Goldberg said. “There are hundreds of housing opportunities we could create if it was much easier to build ADUs [accessory dwelling units].”
A modification of the City of DeLand’s current land-development code could go far in the way of easing the burden on contractors and homeowners, Goldberg said.
“The focus should be wholesale reform of our zoning regulations, which could provide most of the solution, [and] certainly would be part of any solution,” he added.
