Affordable: the Framework

Intro

Let’s take what we’ve learned so far and create a framework of affordable housing typology.

Affordable = revenue-generating

Many falsely believe that asset stripping is the key to affordability. Slums of Mumbai showed that the opposite is true. Even communities below the international poverty level can acquire high-value assets. However, there is an important caveat:

Low-income communities can possess a high-value asset only if it generates revenue.

The one thing low-income communities can’t afford is an underutilized asset. I will demonstrate it by showing how a low-income person can afford a mansion.

Mansion

We can encounter the following assets in a mansion, depending on income:

• Sitting room. The living room is for living, the sitting room is for sitting. Sitting in a living room is impossible, as sitting is too docile for living.

• Great room. Sometimes you want a room that’s just great. Greatness and clutter don’t mix, so the room is empty. Only greatness-boosting assets, such as a Christmas tree, are allowed.

• Dining room. Carrying plates to and from the kitchen is a hassle, so most dining happens in the kitchen or a breakfast nook. The dining room is reserved for great occasions that are not great enough for the great room: birthdays, Christmas, or Thanksgiving dinners.

• Kitchens. Indeed, we have multiple kitchens. One is a staged kitchen straight from Best Kitchens magazine, fully functional but hardly ever used for cooking. Another is a crammed kitchen in the back, filled with unsightly equipment and designed to tuck away catering staff during parties.

• Ten Bedrooms. Three bedrooms are used every day by residents; the rest are for in-laws and estranged children who stay over twice a year, for Christmas and Thanksgiving. Year-round, the bedrooms are used for bragging rights, allowing the owner to state that they live in a ten-bedroom house.

• Privatized Public Domain. At high incomes, residents start to take certain functions from the public domain and create smaller, inferior copies at home. The cinema at home will always be smaller, have worse AV, and lack the newest movies. The bar at home won’t allow us to meet any new people and will lack the social buzz. The gym at home will lack equipment and will be depressing overall. All such functions will be underutilized or abandoned entirely.

• The Great Lawn. A killer of human anthill typology, the great lawn is at home here. It is just as useless as its low-income counterpart, but at a high income, high-value assets can exist purely for aesthetic purposes.

Despite what my cheekiness might indicate, I’m not judging mansions. The number of underutilized assets naturally increases with income because convenience starts to trample efficiency. As I went from low income in Russia to high income in the US (being low-income in the US for some time, too), I also collected a bunch of assets, mostly electronics, that I hardly ever use. During cleaning, I rediscover some of the assets that I forgot I own, something that would be inconceivable at times when I had low income.

So, how can low-income residents afford a mansion with the aforementioned spaces? It's easy. It just wouldn’t be called a mansion. It would be called a Bed and Breakfast (B&B).

The sitting room will become the reception, the grand room will become the lobby, the dining room will serve breakfast, the stage kitchen will be heavily used for cooking, the second kitchen will serve as the back of the house kitchen for staff, many guest bedrooms will become hotel rooms, and the Great Lawn will grow crops or serve as an outdoor wedding venue. The privatized public domain will turn into amenities, lacking in quality nonetheless, but at least utilized through high foot traffic.

You may point out that it hardly sounds like a low-income business. You’d be surprised. A substantial number of small businesses are yielding low income for many reasons, such as being situated in a low-income area or their business being disrupted by a larger player. Owning a B&B is tough since Airbnb became a thing. Also, the farmers are well-known to be “broke millionaires”, as they have millions of dollars in assets, land, and equipment, yet the results of their hard work are often cancelled by weather and high maintenance and operation fees, which puts some of them at a low-income level.

Why bother, then? Some quit and become employees, as they realize that they make more money working less for someone else. However, many persist despite the setbacks. Working for yourself doing (hopefully) what you love is fulfilling, even if you earn less money. Also, you have endless upside for social mobility. While business owners' income starts at around minimum wage, it ends well in the upper-middle class and beyond. At the same time, low-income wage work will likely remain low-income wage work.

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Any assets we propose to a low-income community must generate revenue for residents (not an outside third party) or be capable of doing so.

Can they afford a winter garden that just looks nice? No. Can they afford a greenhouse that looks nice and grows food for sale? Possibly. Can they have a gym? Maybe. What if the gym permits dance classes run by residents? Then definitely. Garage? Probably not, indoor parking is a privilege. What if the garage is also a small mechanics or customization shop (vinyl wrap is fashionable at the time of writing)? Perhaps.

In other words, the lower the income, the more pressure the program is under to generate revenue. If there are design obstructions to revenue generation or the cost is too high to get it going, the whole program will likely fail, as human anthills have demonstrated many times over.

The key to affordability is not asset-stripping but strategically providing assets that the residents can use to generate revenue for themselves—or, at a minimum, not obstructing residents' attempts to generate revenue with our design moves.