Community Questions & Answers: Missing Middle Housing

Below are questions, recently posed by the Decatur community, regarding housing affordability and policy proposals to re-allow missing middle housing in Decatur's neighborhoods, and answers to these questions.

Where can I view the latest updates on the Missing Middle zoning progress?

An update was provided to the Decatur City Commission at the June 21, 2022 work session. The work session recording can be viewed here, and the slides can be viewed here. 

Why was "missing middle" housing (duplexes, triplexes, quads and smaller apartments) disallowed in single family districts in 1988?

New "missing middle" housing construction has not been allowed in Decatur's neighborhoods since 1988. The older "missing middle" housing types still prevalent in Decatur's neighborhoods were all built prior to this time. Decatur was not the only city in the U.S. to disallow these housing types in the late 1980s, which may have been related to larger macro-economic issues occurring throughout the country. During this time period (in the early 1980s), rental housing had become a lucrative investment, utilized as a tax shelter, which may have led to overbuilding of rental housing stock. The Tax Reform Act of 1986 reduced "depreciation acceleration" of these rental units and may have helped lead to the real estate crash during this time period. It is reported that investors abandoned multifamily investments, which led to increased vacancy and neglect. Another change during this time period was a decrease in the number of new construction federal housing units nationwide. The construction of new federal housing units was reduced dramatically, with zero new low-income, federally subsidized units built nationwide in the year 1984 (Cato Institute). Instead, low-income renters were encouraged to utilize vouchers, which enabled them to rent apartments in a wider area including neighborhoods. These converging themes, among others, may have been the catalyst for disallowing "missing middle" housing types in neighborhoods and instead mandating only the construction of single-family homes.

How might this change impact property values?

Most studies show that affordable housing and/or smaller housing units have no effect or positive effect on nearby property values. In a 2016 article posed on Trulia entitled "There Doesn't Go the Neighborhood: Low-Income Housing Has No Impact on Nearby Home Values," concluded that in the nation's 20 least affordable housing markets, low income housing built during a 10-year span shows no effect on nearby home values. These results have been replicated in other studies.

How might this policy affect school enrollment?

Per a recent discussion with the City Schools of Decatur, the class size for younger grades is smaller than the class size of middle and high-school students. The City Schools of Decatur seeks to maintain class size, as both over-enrollment and under-enrollment can trigger changes within the schools. 

Studies show that traditional single-family homes have 2 to 3 times the number of school-aged children than those residing in apartments. A 2020 Student Yield Analysis created by Cooperative Strategies for the City Schools of Decatur found in the 2019-2020 school year that 3.69 times as many students resided in single-family homes than in townhomes, condos and apartments combined (K-12 student counts, 2019-2020 by housing unit type).

CSD estimates the number of students in large, new construction apartment buildings at 0.5 students per the number of 2-3 bedroom units, with the actual number falling below this predication. For example, for one new development with 329 units, CSD initially projected 129 new students. The current number is 29.  This number typically grows slightly over several years and across all grade levels, a change that the schools are able to absorb.

Housing types such as duplexes, triplexes and quadplexes are typically smaller and have fewer bedrooms than new construction, single-family homes. These housing types tend to attract a more diverse array of owners including young couples and single people, and older “empty-nesters” resulting in a lower burden for the school system with equivalent property taxes values compared to new single-family homes. In addition, increasing the number of homes affordable to local workforce limits sprawl, creates shorter commutes and increases opportunity for health outcomes and walkability in our cities.

What is the current home price in Decatur?

The IntownMarket Report show the average home price in 2021 at over $700,000. 

What are population projections for the City of Decatur?

The Atlanta Regional Commission projects that the City of Decatur will add almost 10,500 people by 2050.

Does the "missing middle" zoning policy address wealth creation?

This policy will allow both market-rate and non-profit developers to participate in creating new housing.  For example, the newly formed Decatur Land Trust could have flexibility to create four affordable homes instead of one. This could be in the form of affordable home ownership or rentals, which would provide more of an opportunity to build wealth and save up. In new, market rate missing middle development, first-time home buyers would have the opportunity to purchase homes well below what is currently available in Decatur's housing market. As these new home increase in value, the homeowners will build wealth through the price appreciation. Existing homeowners who decide to partition their house up can live in one side and have an opportunity to supplement their mortgage payment with the rent generated from the additional units. This would allow residents who are on a fixed income to generate additional income each month.

Is this zoning change finalized? Will the community have an opportunity for input?

The recommendation for this policy to move forward has been seen in several past community reports including the 2010 Strategic Plan, the 2018 Housing Summit and the 2020 Affordable Housing Task Force report, as well as the 2020 Strategic Plan. Community input sessions were held in 2021, and you can view the session recaps here. For history, please read the storymap, watch the video, and read the Task Force Report at www.decaturga.com/affordablehousing. Additional methods to provide input including a Questionnaire (Pre-Forum Interview) for comments and questions are located at www.decaturga.com/affordablehousing. 

If the zoning code is modified to re-allow duplex, triplex, and quadplexes in single-family zoning districts, what limits the new housing from being constructed as side-by-side townhomes?

The policy is for the new duplex, triplex, and quadplex units to fit into the same footprint of a new single-family home as described in Decatur's Unified Development Ordinance. This means any new structure must comply with Floor Area Ratio, setbacks, height, and other requirements as a new single family home.

Will this new housing be required to meet ADA regulations?
A market rate, privately owned quadplex (4 units) will be required to have one accessible unit. 

Can Decatur require new developers to provide a percentage of units as affordable units?

This is the Mandatory Inclusionary Housing Ordinance, which Decatur adopted in 2020.  Developers are required to add 10% affordable units at 80% AMI if the new development has 5 or more units, or if redevelopment of an existing property adds more than 5 units. The Mandatory Inclusionary Housing policy does not currently impact duplexes, triplexes and quadplexes due to their number of units.

What is the process of making new affordable housing (for example, as created by the new Mandatory Inclusionary Housing Ordinance) available once identified, and the follow up with builders and management companies to make sure these initiatives are carried out and that builders comply with income requirements?

Although Mandatory Inclusionary Housing Ordinance was passed by the Decatur City Commission in 2020 to mandate 10% of units in new developments be affordable at 80% AMI, Decatur has not yet had a new development (permitted after the approval of this Ordinance) built. There is one pending development that would be the first development to comply with the new Ordinance. If built, the developer / property manager would be responsible to provide proof of income verification and rent prices annually to the City of Decatur.

I am concerned about investors purchasing homes or multi-units.

From the Washington Post: in 2021 Metro Atlanta had 25% investor home purchases, compared to 12% in 2015. In 2021, Decatur (including all of the 30030 zip code both inside and outside of Decatur City Limits) had 10% investor home purchases. Although this should continue to be monitored, the City of Decatur does not appear to have the impact of investor home purchases that has been seen in other parts of metro Atlanta.

Can Decatur join other cities to set the amount that landlords can raise the rent based on inflation so that residents won't be forced to move due to unfair rent hikes.

Unfortunately, this is considered rent control and is illegal in the State of Georgia. Decatur is not allowed by law to put this into place unless the State law is changed.

I am concerned that many of the new multi-units will become Airbnb rentals. Can a city regulate Airbnb rentals?

Cities seem to fall into three categories: 1) ban short-term rentals outright or in specific areas, 2) regulate short-term rentals, or 3) allow short-term rentals without restrictions (where short term is typically defined as 30 days or less). Atlanta's city council recently voted to allow homeowners to rent rooms or entire houses to guests for up to 30 days, as long as the owners apply for an annual license, pay a $150 license fee, and collect city hotel-motel taxes from guests (Atlanta Journal-Constitution).  In 2021, San Diego passed The Short-Term Residential Occupancy (STRO) ordinance which limits whole-home, short-term vacation rentals to 1% of the city's overall housing stock. It also requires property owners to obtain a license for vacation rentals and limits them to one rental property within the city of San Diego. Some cities, such as Nashville, ban short term rentals in residential areas or in the city as a whole. Nashville specifically bans investor-owned short term rentals while allowing owners to apply for a license to rent a room in their (owner-occupied) house as a short term rental. With regulation often comes a fine (typically $500 - $1500) for homeowners who are cited for renting to loud our disruptive renters. City of Decatur Staff are currently working on a proposed short-term rental policy for Decatur.

Would this policy allow the purchase of units within a "missing middle" development?

Yes, a duplex, triplex, or quadplex can be "condoized" and sold.

Would ADUs be allowed with multi-units?

A detached ADU would be allowed on the parcel with a missing middle development if the lot size and setback meet current standards of Decatur's Unified Development Ordinance. 

What is the impact on City services, including trash and recycling, water pressure, and sewer capacity?

Because the City of Decatur trash bags and recycling bins for a duplex/triplex/quadplex would still be located together on the single property, the impact to the City workers will be minimal. Each household will purchase Pay As You Throw bags for trash, and each household will receive a recycle bin. The fees collected by the City for these services will be higher for multi-unit homes as fees are collected for each household. New construction will need to comply with DeKalb Water and Sewer regulations. For water connections, there are typically more than one water pipe running under each street, and the builder may submit a request to connect to the larger of the water pipes to minimize impact. The City of Decatur has the oldest water pipes in the county, and many of these pipes will be slated for replacement by DeKalb County in the coming years.  Sewer capacity depends on the location of the new property. If sufficient capacity does not exist, the County will require the builder to utilize stormwater "credits" for construction.  

I worry about on-street parking and the safety of pedestrians and cyclists. 

Data shows that streets in neighborhoods with on-street parking are safer for both cyclists and pedestrians than those without on-street parking. A map referencing accident locations can be found on page 24 and 25 of the City of Decatur Community Transportation Plan Update (August 2018). On-street parking is one method that helps to reduce vehicle speeds, which in turn helps to reduce vehicle accidents. 

Can we eliminate parking on-site?

Many cities are looking to eliminate parking minimums, thereby allowing each builder or developer to determine if and how much parking they will build on the site. This is not currently part of the recommended policy for the City of Decatur, and the "missing middle" policy recommendations strike a middle-ground by allowing up to 50% of the parking to be on street for a duplex, triplex, or quadplex. If this is something you feel is important for the City of Decatur to consider, you can provide that information in the Pre Forum Interview here or you can relay this to your Commissioner. 

Can the city regulate the number of cars per home?

Regulations are possible through resident-only parking, which exists in several neighborhoods in Decatur. Additional regulations would need further study, and would need to apply to all homeowners including single-family homeowners. This is not a regulation that the City of Decatur is currently considering.

I do not think that apartment dwellers pay taxes.

This is false. Apartments are subject to City of Decatur and Decatur City School taxes at the same millage rate as is applied for single-family homes. This tax is passed along from the property owner to the renters as a portion of the rent payment.

I am concerned that rental properties are more likely to be in disrepair.

The City of Decatur tracks and monitors code violations related to property conditions. The majority of properties currently being monitored are vacant, single-family homes. The City of Decatur's code-enforcement data does not corroborate the opinion that rental properties in Decatur are more likely than single-family homes to be in disrepair.