Microsoft Will Spend $500M To Address Affordable Housing and Homelessness in the Seattle Region (geekwire.com)

Microsoft is dedicating $500 million to fund construction of affordable homes and homeless services in the Seattle region in an effort to alleviate a growing housing crisis driven by the city's tech boom. From a report: The Redmond, Wash.-based tech giant will commit $475 million for loans to affordable housing developers over three years and another $25 million to services for low-income and homeless residents. It's the largest philanthropic pledge in Microsoft's history. "This is a big problem," Microsoft President Brad Smith and Chief Financial Officer Amy Hood wrote in a blog post Wednesday. "And it's a problem that is continuing to get worse. It requires a multifaceted and sustained effort by the entire region to solve. At Microsoft, we're committed to doing our part to help kick-start new solutions to this crisis." Microsoft's announcement comes amid growing pressure on tech companies to mitigate the consequences of growth. Over the past decade, big tech companies have drawn thousands of newcomers to the Seattle tech region with lucrative tech jobs, bidding up housing costs and often squeezing out low-income neighbors.

Comments

Will Those Homes Update At Random Times?

[dryriver]

Like most Windows 10 installs=

Re: Shareholder interests

[backslashdot]

Not all shareholders have a goal of making maximal profit. Why is it assumed that the sole reason for owning shares in a company is to see financial returns. For example, I invest in Tesla not wanting much of it back but rather to see people get affordable electric cars and to dramatically reduce the 40,000 people killed in traffic accidents by enabling autonomous vehicles. Making a difference like that to me is more important than making money.

Re:Loans get repaid; how is this an expenditure?

[known_coward_69]

it's an expense when you loan the money and then you put the amount owed as receivables onto your balance sheet and recognize the repayments as revenue

Investment not charity.

[Martin S.]

This is not a charitable donation, it is an investment, a loan for affordable housing. Smart investment considers intangible benefits from the obvious 'good publicity' from corporate responsibility to increasing their own value by increasing the value of the environs. It is not a bad thing, but let's see this for what it is, a smart business move.

Re:Investment not charity.

[fermion]

MS and very rich people do not do charity. They do philanthropy. They invest thier money to create the world they want, or to promote their right to extreme wealth.

Charity is when you give someone some money on the street or the Red Cross some money to deal with future disasters. Philanthropy is when you demand the guy on the street goes to homeless shelter or complain because the Red Cross does not spend money on the disaster you want

The reason home prices are so high is that certain groups of people like to live together and they like to have high home values so undesirables don’t go there. To see these groups of people just check the demographics of Seattle, San Francisco, and houston, each with very high densities of very well paid engineers.

Affordable housing can temper the tragedy of gentrification by providing resources to displaced people who can no longer afford to inhabit the area. More than likely it will just excaberate the problem by causing more to want to live there, encourage even higher prices to keep the undesirables out, and promote the myth that certain groups of people have the right to live wherever they wish, even if they. cannot afford it,

it is like socialism for the entitled.

Rates

[JBMcB]

1. The interest rates on the loans are below market, to the point that they will probably just barely make their money back if the loans are paid, depending on inflation
2. They are making loans to begin with - sometimes banks won't give out loans to develop low income housing as it's risky

Re:Have to fix the root cause

[WoodstockJeff]

There are other "root causes". Let's just say "poor life choices" is one of them, because it incorporates quite a few variations.

Around here, those without shelter primarily consist of people who have rejected shelter being offered to them, because there are too many "restrictions" attached... Like giving up drugs (including alcohol) while in the shelter. There are multiple unfilled, low-skill jobs available... but all of them require that you show up regularly for them, and many require drug testing.

Counseling is available for those who need it... but many refuse it.

These issues won't be dealt with by building more buildings.

Re:Have to fix the root cause

[Ichijo]

If the city stopped transferring wealth from poor, dense neighborhoods to affluent, sprawling ones, I think you would see middle-class neighborhoods asking for more density and more retail so they can get their potholes fixed.

Microsoft is the perfect company to solve this

[tbuddy]

They are experts if you need a place to crash.

Re:Have to fix the root cause

[WolfgangVL]

It's not JUST homelessness. That's a problem, and it's one of the worst in the country, but poor life choices do not drive the price of a 400 sq ft studio up past 1k/month.

Building more housing most definitely WILL help the root issue, providing the rich don't just buy them all up and rent them back to us at todays cost.

If the affluent want to enjoy living like royalty, then they need to ensure the servantry can afford the servants quarters.

I've been trying to buy a home in the Seattle suburbs for 2 years. Every time I find something I want and get to making an offer, I am outbid by 100k, sight unseen, with no strings attached. These are not families bidding me out, its wealthy investors.

Do people not understand how housing prices work?

[Solandri]

If the housing prices in your area ranges from $x00,000 to $y,000,000, then there are z people who can afford to live in the area.

• If you construct n new homes in the $x00,000 to $y,000,000 price range, then the number of homes those z people can afford increases. Supply exceeds demand, and the average price decreases. And now (z+n) people can afford afford to live in the area. The n who were added all bought in the below-$x00,000 price range. But the average price decrease is because all homes in the $x000,000 to $y,000,000 price range decrease in price. Basically, the n people bought homes which used to cost more than $x00,000, but dropped in price below $x00,000 so they could afford them.
• If you construct n new homes but restrict them to people who can afford less-than-$x00,000 price range, then the number of people who can afford to live in the area is now (z+n). The n additional people bought the sub-$x00,000 homes like above. But the reservation of those homes for lower income people means less land is available for regular new home construction. Meaning the average price for $x00,000 to $y,000,000 homes increases. Exacerbating the very problem you're trying to solve (unaffordable housing).

It's the same problem that's plaguing student loans. When you subsidize demand, the average price goes up. That's led to school tuitions spiraling up out of control. If you want to lower prices, you need to subsidize supply. Instead of building additional homes and giving them to people at below-market prices (which has the same effect on market prices as handing those people money), build additional homes and just flood the market with them.

Mental illness is rife among the homeless

[rsilvergun]

and they use drugs and alcohol to cope. There's been several long term successes with halfway houses that allow drugs and alcohol while constantly offering mental health services, but teetotalers and religious zealots often want nothing of it.

And besides, it's not hard to run a shelter for the occasional poor person kicked out of their apartment. The real challenge for a just society are those people who aren't just a bit down on their luck but who never had any luck to begin with. But it's just as easy to blame them for their illnesses. A hundred years ago I might have given you a pass on that, but it's 2019. Sure, we can't cure their illnesses, but we at least know it's not demons and we know the solution to their problems isn't to ignore them and hope they just go away and stop begging for change...

Re:Have to fix the root cause

[Anonymous Coward]

This post is great in that it illustrates the very worst approach to solving homelessness. One that's been proven to fail over and over and over and over again, with almost a century worth of data to back up that notion.

You must treat homelessness first, then drug addiction next. Having warmth, shelter, food, and security is essential to building a foundation to which one can then deal with addiction.

If you're going to help people, help them. Put away your paternalistic moralizing. Tying benefits to purity tests is a recipe for failure.