Los Angeles is spending up to $837k to house a single homeless person

In the last 50 years, cities across the country closed down over 1 million SROs (<a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Single_room_occupancy" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Single_room_occupancy</a>) in an effort to remove slums or just neglect at increasing property value. There are now over half of a million homeless. It&#x27;s honestly impressive the number is not more.<p>For the 1.2 billion dollars they are spending, if all of the apartments were built to the spec of a roadside motel room (~350 sq ft - or more than double the average SRO), they should realistically be able to build over 10,000 units for that kind of money (that&#x27;s including California&#x27;s exorbitant cost per square foot).<p>It would be like if the government banned motorcycles, and then said &quot;okay, instead we&#x27;ll make you a nice, compact crossover&quot;, and then handed over design and construction of the crossovers to a company that builds snowplows.<p>What&#x27;s frustrating is that SROs used to be provided by the private market, largely free to taxpayers! How much better a use of government money it would have been to just improve the situation in SROs than to quietly let them shutter and hope the poverty they represented just disappeared with them.

&gt;The audit found 14% of the units build exceeded $700,000 each, and one project in pre-development is estimated to cost almost $837,000 per unit.<p>It sounds like that &quot;up to&quot; in the title is doing a lot of work if 86% are below $700k. I would also like to throw in the added context that the median home price is roughly $915k[1]. Also be mindful whether we are discussing LA county or LA city. The article is about an LA city program. Housing in LA county will be cheaper and the median there is just under $800k[2]. So all of these projects are under the median cost of housing and the overwhelming majority are at least 25% below median.<p>This doesn&#x27;t seem like much of a controversy once you know that context. Housing in LA is simply expensive.<p>[1] - <a href="https:&#x2F;&#x2F;www.redfin.com&#x2F;city&#x2F;11203&#x2F;CA&#x2F;Los-Angeles&#x2F;housing-market" rel="nofollow">https:&#x2F;&#x2F;www.redfin.com&#x2F;city&#x2F;11203&#x2F;CA&#x2F;Los-Angeles&#x2F;housing-mar...</a><p>[2] - <a href="https:&#x2F;&#x2F;www.latimes.com&#x2F;business&#x2F;story&#x2F;2021-11-04&#x2F;what-l-a-countys-median-home-price-795-000-buys-in-six-areas" rel="nofollow">https:&#x2F;&#x2F;www.latimes.com&#x2F;business&#x2F;story&#x2F;2021-11-04&#x2F;what-l-a-c...</a>

the fact that <i>any</i> housing is getting built is frankly a refreshing turn of events.<p>for people unfamiliar with los angeles, is very much a city of landed gentry. republican legislation designed to curtail rising taxes for elderly residents 40 years ago wound up creating a cloistered elite of land-owners that pay nearly nothing in tax and resist any attempt to create additional housing. They coast on a bubble of six-figure increases in equity <i>per year</i> with little to prevent a ramshackle bungalow in inglewood from fetching a cash-only two million dollar price.<p>when legislators typically try to address the very same landed gentry&#x27;s cries for relief from the homeless, they wind up collecting windfall bond measure revenue. as they gain momentum and start striking ground, most communities put up fierce NIMBY opposition and mire whatever initiatives that are approved in court. the city in turn eventually gives up, settles, and uses the remaining funds to quietly continue sanitation and cleanup efforts of camps, occasionally running the homeless away for a day or two.<p>for the city to bemoan rising costs and slow pace is a bit ironic as well. when LA decided to give up on property taxes it had to find a way to make up the difference. hence a league of esoteric inspections and byzantine permitting started popping up for new homes. it means contractors sit idle and watch the price of lumber skyrocket while your self-licking ice cream cone melts in the sun.

I&#x27;m finishing construction next month an 1,100 sq&#x2F;ft single family home in the north bay area; a very high cost-of-living region. We started construction in Sept 2021, after an intentional delay of a couple months to let lumber prices drop after peaking in May-June. My home will be built for about $350k (less land acquisition). I&#x27;m acting as contractor and have connections in the industry so very few can build at my cost. BUT, When I see numbers in articles like this ($837k ea), after dealing with pandemic construction pricing myself, it&#x27;s painfully obvious there is a terrible lack of cost-control. This is not a sustainable solution. And scapegoating on the pandemic is not helpful.<p>I&#x27;m convinced most government agencies cannot manage this type construction in an affordable way, including my home county of Sonoma where we are spending $250k - $350k per homeless person to house them in refurbished hotel rooms (remodeling, not new construction).<p>I don&#x27;t know <i>what</i> the solution is, but I have become convinced that local governments cannot build their way out of this. We have to come up with something better.

L.A. is fighting against CEQA, Prop 13, and its own bureaucracy and process: <a href="https:&#x2F;&#x2F;seliger.com&#x2F;2017&#x2F;08&#x2F;30&#x2F;l-digs-hole-slowly-economics-fills-back-proposition-hhh-facilities-program&#x2F;" rel="nofollow">https:&#x2F;&#x2F;seliger.com&#x2F;2017&#x2F;08&#x2F;30&#x2F;l-digs-hole-slowly-economics-...</a>.<p>If we&#x27;re actually going to do something substantial about homelessness, we need to focus on abundance, not scarcity, and supply-side progressivism: <a href="https:&#x2F;&#x2F;www.nytimes.com&#x2F;2021&#x2F;09&#x2F;19&#x2F;opinion&#x2F;supply-side-progressivism.html" rel="nofollow">https:&#x2F;&#x2F;www.nytimes.com&#x2F;2021&#x2F;09&#x2F;19&#x2F;opinion&#x2F;supply-side-progr...</a>

$837,000 is just the cost of the unit.<p>If you are housing actual homeless, you MUST offer supportive services on-site or have some other types of supervision or these units are going to be trashed.<p>You MUST budget for a lot of ongoing costs.<p>I&#x27;d say $800K+ per unit + maybe $100K+&#x2F;year for supportive services &#x2F; maintenance etc?<p>One question is, would that 800K + $100K&#x2F;year go further somewhere else?

They&#x27;re spending money to build housing, which will be used to house people without homes. The headline makes it sound like they&#x27;re paying a million dollars in rent, but in fact this is real estate development.

Oh yes, my home city.<p>I left LA for numerous reasons, absolutely unaffordable housing was one of them. Most people are doing extremely poorly in Los Angeles.<p>It&#x27;s the only city where you both have to pay an insane amount of rent, and own a car. The bare minimum survive in LA is probably around 80 k. But the median income there is only around 70k.<p>Of the people I was meeting, almost no one had a job or any real interest in working. Very bad things tend to happen if you&#x27;re around people like that.<p>I moved to Chicago after being disenchanted with LA, and I met an amazing partner with a great career . I only meet people in real life after a particularly scary app experience. Like I said, bad things happen if you&#x27;re around people who don&#x27;t work. Not that you need to make too much in Chicago to live.<p>A two bedroom in Chicago will run you from 1300 to 1600. You don&#x27;t need a car since it has one of the best public transit systems in America, and a monthly Metro passes about a hundred bucks.<p>So let&#x27;s say you want to split a two-bedroom with a friend, for your transportation and housing. Housing you&#x27;re only spending about $1,000 a month.<p>Compared to LA where that same two bedroom cost $2,600, and you need to own a car. Most people just run out and finance something. So once you make your payments and your insurance, and your maintenance and your gas, you&#x27;re easily spending between $700 to $900 on transportation alone.<p>Base cost of living in Chicago, 1k + a few hundred for food , utilities and fun. In LA your taking 2100$ + that same few hundred.<p>Plus I got a pretty significant raise when I moved to Chicago! No rational person should stay in Los Angeles !<p>&#x27;But my family&#x27;s here.&#x27; Most of my family ended up leaving because they just can&#x27;t afford to it anymore. Why be the last person off of a sinking ship.<p>The time to fix California&#x27;s affordable housing crisis was decades ago before Prop 13 was passed. Too late now

This is such sloppy journalism: &gt; one project under development expected to hit as much as $837,000 for each housing unit,<p>How typical is that? where is it? how long is it expected to last? what other features does it have? Does that include one-time architecting costs that make future developments cheaper?<p>&gt; HHH project includes 8,091 housing units — most with connected services for mental health and substance abuse treatment<p>so how much of the $800k goes to the mental health etc services? the paper apparently read the audit, but doesn&#x27;t bother going into any detail about this.

Do you realize that you could give that homeless person a first class ticket to Detroit? Put them up in a hotel until an abandoned house could be totally rebuilt for them. Pay their electricity, water, heating costs and taxes for the next ten years and still save California taxpayers $600,000!

Is there any way to fix incentives with government contracts, so that the product that is purchased is the lowest price for the highest quality? In the free market, there are generally incentives for that because companies have a brand, and if you deliver poor quality, consumers eventually catch on, your brand suffers, and you lose business to your competitors. How does this work in the government? Where is the disincentive to keep contractors from delivering the shoddiest product for the government check? This mechanism seems totally absent.

The primary measure of success in the last two generations in the United States has been an ability to combine plausible incompetence and graft, while remaining protected under a banner of nouveau political theory. Los Angeles has a tremendous pool of talent in this regard, perhaps some of the best in the world. Areas which are very obviously less afflicted include areas of &#x27;Los Angeles County&#x27; outside of --and quite distinct from--the very broken &quot;City of Los Angeles,&quot; and adjacent counties, such as Orange, Ventura, and Kern, all of which are wildly superior in the physical realization of governance.

A conservation think tank issued a report saying Denver spends about $400,000 per year per unhoused person.<p><a href="https:&#x2F;&#x2F;commonsenseinstituteco.org&#x2F;the-economic-footprint-of-homelessness-in-metro-denver&#x2F;" rel="nofollow">https:&#x2F;&#x2F;commonsenseinstituteco.org&#x2F;the-economic-footprint-of...</a><p>But drilling down finds 10% of that is direct budgeted other other 90% indirect like the cost of police sweeps, mental health, etc.

I&#x27;ll cut them a deal. LA can send me a check for merely $500,000; and I&#x27;ll agree to never camp out on their streets. I also expect some sort of formal recognition for helping them meet their targets of reducing homelessness.

This article is a perfect example of how word tenses can be used to manipulate and misrepresent information.<p>The title says that the city &quot;is spending&quot; an amount, which suggests that this is a routine cost, leaving the reader of the headline to fill in the blanks &#x27;oh, is spending annually?&#x27;.<p>But the tense in the article itself is different:<p>&gt; Most of the units are studios or one-bedroom apartments. The audit found 14% of the units build exceeded $700,000 each, and one project in pre-development is estimated to cost almost $837,000 per unit.<p>&quot;Is spending&quot; != &#x27;expected to spend&#x27;.<p>The former has the unstated implication that this is a recurring cost, or at least that this is a cost the city is in the process of spending, whereas the article explains that this is only a projected cost.

My ex used to do some auditing at LA city. Usually these contractors are vehicles to give tons of money to well connected friends of the city council or mayor for services like “consulting” and “management”. They also have large amounts of middle management. In one case social workers couldn’t handle the number of required visits per week (I think they each had 30 clients or more). The solution was to hire more consultants and project managers to analyze the situation instead of hiring people to reduce the workload to reasonable levels.

Like all government housing projects, they&#x27;ll turn into slums within a decade, and then be razed as urban blight.

It never says how many people are housed in a single &quot;unit.&quot; The number could be very misleading.

Australia has that beat.<p>We&#x27;re spending around $4m (USD 2.87m) per person to house refugees in Nauru offshore detention. Because reasons.<p>Persionally, I&#x27;d rather let the formally recognised refugees come to Australia and pay them each $100k a year for a savings of 3.9m&#x2F;year&#x2F;person. Bargain!

<i>The scope of the expanding problem can be seen in the city budget: When Garcetti took office in 2013, the city was spending about $10 million treating homelessness. The budget he signed last year included about $1 billion.</i><p>Someone is making a lot of money...

Haha, this is normal among so-called progressive circles. They subscribe universally to the &quot;if it&#x27;s not good enough, it&#x27;s better to have nothing&quot;. So you can&#x27;t provide crappy housing, it&#x27;s better for people to be on the street. You can&#x27;t provide crappy jobs, it&#x27;s better for people to have no jobs. You can&#x27;t provide crappy healthcare, it&#x27;s better for people to die.<p>The secondary aspect of this is that these people will fight tooth and nail to ensure that crappy things don&#x27;t exist but will put up some token &quot;We should have X&quot; to get the good thing built. Progressives...

This headline seems misleading. First, these are one-time costs, but most reporting on programs like these are annual costs. Second, this conflates a lot of numbers. <i>Most</i> are one bedroom (which could house a small family, as sleeping on a couch is more comfortable than a car), but the <i>most expensive</i> is $837,000. There&#x27;s nothing even stated that the most expensive one-bedroom is $837,000). In fact, 86% are under $700,000 to build. In fact, they plan to hit 10,000 units in the next 5 years, with it seems about half of those coming from the first $1.2 billion allocation.

Homeless-care services like this are the equivalent of dealing with tech debt. Every homeless person incurs gigantic recurring costs, and to make them no longer homeless requires even larger temporary costs. All of this could have been avoided by solving for the tech debt that leads to homelessness, but there&#x27;s apparently no real appetite for investing resources into that.<p>So now we have to pay down our tech debt. As you can see from the reaction to programs like this, we&#x27;re more likely to simply sink escalating maintenance costs into the existing system instead.

The sad part is how long such spending has gone on across the state.<p>They&#x27;re homeless because they&#x27;re mentally ill, not because of the tautological nonsense of &quot;they&#x27;re homeless because they haven&#x27;t a home&quot;. The mental illness is exceeded only by the stupidity of the policies.<p>Instead of the singular focus on establishing state-paid housing, _requiring_ treatment for the chronically homeless is far overdue. The option of shooting-up and camping on the streets clearly has not worked in any way -- show me the data for how that helps anybody.

This is not a story about government waste, it&#x27;s a story about the high cost of building housing. If you want this price to be lower, lower the general cost of housing. The median sale price in Los Angeles is about 1 million dollars, and new construction sells for more. New construction at $837k is a comparative deal. Also, if you read the report, a significant part of the cost is intragovernmental transfers, i.e. they are charging themselves all the usual impact fees for water and sewer and whatnot.

This pisses me off a LOT.<p>I&#x27;m currently owner building a house. It&#x27;s going to end up costing 100k and I&#x27;m doing this paycheck to paycheck.<p>Doing it because I can&#x27;t afford a house. I&#x27;m too old to have a 30 year mortgage.<p>Is LA willing to send me 1&#x2F;8 of that cost to house my wife and I? And we&#x27;ll do it ourselves.<p>Can the homeless build their own houses? Are these people just going to be getting hand-outs forever?<p>Why don&#x27;t they just give Habitat money? This is insanity. I hope the LA administrators that started this mess are fired beyond fired.

This is what I see: <a href="https:&#x2F;&#x2F;i.stack.imgur.com&#x2F;Sl9RD.png" rel="nofollow">https:&#x2F;&#x2F;i.stack.imgur.com&#x2F;Sl9RD.png</a> (&#x2F;s)

How many years will the houses last? Is this land cost+improvements?<p>What is the average cost? 800,000 per unit is high. But that appears to be the upper end of the bell curve.

Please understand the connection between anti discrimination policy and expensive housing. It is illegal to discriminate in housing <i>except</i> via higher prices. So that&#x27;s where all the pressure winds up for people to avoid the externalities of poor neighborhoods. I grew up on welfare and then became middle class via STEM and got to see both sides of it.

The title (which comes directly from the article) is surely clickbaity at best. It is not the case that there is one homeless person, whom LA is spending $837k to house; it is the case (so says the article, anyway) that LA has a massively overspending project whose amortised cost works out to &quot;up to&quot; (what a weasel word) $837k&#x2F;person.

For the european fellows: <a href="https:&#x2F;&#x2F;12ft.io&#x2F;proxy?q=https:&#x2F;&#x2F;ktla.com&#x2F;news&#x2F;los-angeles-is-spending-up-to-837000-to-house-a-single-homeless-person" rel="nofollow">https:&#x2F;&#x2F;12ft.io&#x2F;proxy?q=https:&#x2F;&#x2F;ktla.com&#x2F;news&#x2F;los-angeles-is...</a>

Homelessness, like healthcare reaches a point of diminishing marginal returns where the problem just gets worse when more money is spent on it. If there was a hard upper limit on spending and then the government just had to get creative on doing things efficiently, things would work out better.

:( this link is not available in Europe

Reminds me of this video: <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;watch?v=CWU6dJ8tub4" rel="nofollow">https:&#x2F;&#x2F;www.youtube.com&#x2F;watch?v=CWU6dJ8tub4</a> (Milton Friedman&#x27;s 4 Ways to Spend Money)

&gt; Our European visitors are important to us.<p>&gt; This site is currently unavailable to visitors from the European Economic Area while we work to ensure your data is protected in accordance with applicable EU laws.<p>Thanks, I guess?

I appreciate the need to help homeless folks, but I don&#x27;t understand why they need to be housed in California. Why can&#x27;t we build housing for them somewhere else, where it&#x27;s cheaper?

The rust belt has spare houses and apartments. Why the hell can&#x27;t we allocate better? We can&#x27;t stuff <i>everybody</i> into CA, dammit!

I can&#x27;t understand why California politicians aspire to spread their ideas nationally. There is so much grift and lack of results.

(I apologise in advance for my apparent ignorance on this) but are we sure we properly actually understand <i>why</i> people are homeless?<p>Is there a proportion of homelessness that is to some extent - although I hesitate to use this word - &quot;voluntary&quot;? Is there really nowhere else to go other than to sleep on the streets?

Smells like a payola to a certain people in trusted position.

CA tax money is the biggest racket in the world.

I do not understand the cost breakdown.<p>So a developer wants to build a hundred basic units (350 square feet&#x2F;30 square metres) in a block and the cost is costing eighty million dollars?<p>We can do much better. Where are the factories building the prefabricated units to build apartments from?<p>I have a friend from East Germany who&#x27;s parents grew up in the Stalinist apartments. They solved this exact problem in the early 1950s. What is wrong with LA?<p>And not to pick on LA. This is a problem throughout the West as far as I can tell. What is wrong with us? Why can we not efficiently build housing?

Sustainable!

Part of the problem is that due to the mild climate, LA inherits a large part of the homeless population of the whole country. They come from all 50 states to the west coast. So this isn&#x27;t entirely a problem of LA&#x27;s making, even though they have to bear the costs.

Where&#x27;s the link to sign up? I&#x27;m ready to check out of the rat race.

ICON’s 15.5-foot-tall 3D printers can build the exterior and interior wall system for a single-story house in a week. The method cuts 30% off traditional construction costs and has been proven to produce homes for as little as $10,000. Compare that to a recent effort in Los Angeles to build 117 pre-fab tiny homes for the unhoused for $5.1 million. Compared to the LA efforts’ approximate cost of $43,590 per home, ICON could print homes at a 4x cheaper rate. - we wrote this for a story back in October. ( <a href="https:&#x2F;&#x2F;news.youexec.com&#x2F;briefs&#x2F;texas-startup-will-build-100-3d-printed-home-in-first-of-its-kind-development" rel="nofollow">https:&#x2F;&#x2F;news.youexec.com&#x2F;briefs&#x2F;texas-startup-will-build-100...</a> ) The fact that it costs them $800,000 in some cases is just ridiculous.