And What to do About It
Xavier Suarez is the former County Commissioner for District 7. He wrote this opinion article for the Spotlight.
In his recent article for the Spotlight on why Miami’s housing costs are soaring, Andy Parrish makes points based strictly on free-market forces and other “natural causes” such as our luck in escaping major hurricanes.
Here are other factors that can play into housing costs.
- The Cost of Commuting
As the urban core enjoys a residential renaissance, and continues being the preferred workplace for banking, legal activities (because of our main courthouse), government, and health care, housing close by becomes more desirable. The only way to combat the effect on working-class commuters is to reduce sharply or eliminate the cost of commuting. Miami has done that with free trolley service, but connections to Coral Gables, Miami Beach, Doral, and the North end are either nonexistent or expensive. We need to build the four remaining rapid transit branches and to make the existing ones free for commuters, as other cities are doing. It’s about a $75-$100 million annual hit, which is less than 1% of the county’s combined operating and capital budget of $12 billion. - Poor Public Transit
Where mass transit already exists, e.g. Metrorail from downtown to Dadeland, we have facilitated/incentivized development with reduced parking requirements and ground floor retail. Five projects in my county commission district were built, totaling over a billion dollars. All required a percentage of workforce housing, with the highest being Cornerstone on U.S. 1 and 37th Ave, at 40%. The county’s effort to change zoning along the projected rapid-transit arteries is foolish, because it puts the cart before the horse. First, you have to build the rail system. It can be very light rail, also referred to as personal rapid transit, which has the added advantage of using small pods that can be then downloaded to use as neighborhood circulators. - Burdensome Taxes
Real estate taxes are regressive. The homestead exemption was set in 1979, when the average value of a home was $25,000. Workforce housing should be exempt from real estate taxes, and taxes on the homestead should not increase until the property is sold. Right now, they’re limited to 3% for existing homesteaders, but not for new homebuyers. It is criminal to tax people more for their property because somebody wants to buy it. Like stocks, a homeowner should not pay an additional amount until the actual valuation increase is realized with a sale. - Casualty Insurance Costs and the Need for Reform
All catastrophic insurance for workforce housing should be insured by the government. When a one-in-a hundred-year hurricane hits, the insurance companies go belly-up and the state has to step in anyhow. For multifamily housing, such as condos and high-rise apartment buildings, the deductibles go up with the value of the properties. In Brickell, we have not collected on a single claim in at least a decade. In the meantime, casualty insurance is more than half of our budget. - User Fees
For homeowners who do additions, there are fees for everything, including for having a waste container on site. Fire-rescue fees, garbage fees, and other such costs for classic municipal services should be prohibited—without having to go to court, as we have had to do in Miami. - Tolls on Roadways
A lot of working-class commuters will never be able to use mass transportation because they need their vehicle at the worksite. They and others who need to drop off kids at school, carpool with spouses, etc., should not pay a penny for using highways that don’t wear out and clean themselves with rainwater. - Energy Costs
Government should fund solar energy for all new workforce housing. This doesn’t necessarily involve raising taxes, since we already have incentives for existing homeowners.
Xavier Suarez was the mayor of Miami between 1985 and 1993. He served as county commissioner for District 7, which includes Coconut Grove, between 2011 and 2019.
To read Anthony Parrish’s article on the rocketing costs of Miami housing, click here.
