Last night, members of Asheville City Council acted as if they were hearing about the law of supply and demand for the first time. Before them was a proposal to develop a 192-unit apartment complex. The developer, Triangle Realty, has built so many projects in five states, I question the number presented in the staff report. Triangle does not build to flip, but it manages properties and sets its rates at market values.
Vice President William Ratchford explained how his company had launched two projects at the same time so they could work together to bring down rents. He explained there is a scarcity of apartments in Asheville. Vacancies for the area run around 4%, and Asheville is the second-highest-priced market in which Ratchford has worked. He argued that by creating more rental units, landlords will have an incentive to lower prices to lure tenants from one another. With high prices, landlords can raise prices until the last shopper squeals.
After members of council thanked Ratchford for the education, Councilman Gordon Smith asked if he still wouldn’t offer some units at “affordable prices.” Ratchford explained again how increasing the supply of housing lowers prices for everybody. Making some people pay extra to cover the costs of letting others pay less, in modern parlance, gentrifies by creating a gap. Ratchford repeatedly used the term “mess with” to denote going through a design review process.
The development was approved by a 5-2 vote. Smith and Chris Pelly had wanted the developer to do more not to create affordable housing, but to support city council’s policy that is supposed to create it through subsidy.
