Determining how to increase Reno’s stock of housing while lowering housing costs is going to take a long time, Reno Mayor Hillary Schieve said Wednesday during a Reno City Council workshop. 

Schieve cut off discussion after two extended comment periods where council members lobbed questions at University of California, Los Angeles urban planner and policy expert Shane Phillips. Phillips presented ideas about how Reno can move forward to alleviate the high cost of living, particularly housing.

He produced a 73-page report on strategies for improving housing affordability in Reno and provided recommendations to council members. His presentation was preceded by an overview of the current housing landscape by the city’s Director of Housing and Neighborhood Development, Monica Cochran Kirch.

Kirch said housing prices have risen faster than income in the Reno area, leading to the housing challenges that many residents face. Over the past six years, the percentage of cost-burdened renters—paying more than 30% of their income for housing—has grown from 46% to 60%, she said. 

While a smaller percentage of mortgage holders are cost-burdened versus six years ago, down from 30% to about 25%, fewer than 20% of those earning the area’s median income can afford to purchase a home, Kirch added.

“At the end of the day, it’s really just about ensuring that short-term rentals aren’t more lucrative than renting a unit for a long-term occupant.”

She pointed to several factors contributing to the current situation, including unemployment, an increase in investment properties and inflation. The cost of building affordable housing units has gone up about 42% “per door,” she said, making such projects more challenging to support.

Despite what housing advocates say are grim numbers, Kirch said Reno is considered a leader in the state with the most significant number of housing units in the pipeline. In the past six years, she said, the city council has taken action on nearly 3,000 affordable housing units, and in 2022 alone, the city issued certificates of occupancy for 2,605 units of all housing types. 

“That’s because you’re awesome,” she told council members. “This is super exciting. All of the efforts I previously discussed show that we are a leader in this space.” 

Needs remain greater than the supply

Reno may be a state leader, but it still has a huge housing gap. Nevada’s 2022 Housing Progress Report found Reno needs 21,220 affordable housing units based on current needs. At the current rate, the city would meet the current demand for affordable housing in 2066. 

Phillips started his presentation by summarizing Kirch’s data: “Housing is never affordable in places where it is in short supply.” 

Reno is a victim of its own success, he said, with jobs increasing by 13.3% over the past six years and housing only increasing by 10.6%. That 3% amounts to thousands of units, he said. 

Phillips’ top recommendation was for the city to focus on infill projects, which he said are more affordable due to lower land costs and smaller units. Directing growth inward also gives the city more control over what it looks like in existing neighborhoods. 

Bringing together local agencies involved in housing development is also near the top of Phillips’ list of recommendations. He said getting a shared understanding of the overall goals, processes and standards will help streamline the process for developers. Without getting buy-in on the urgency of housing developments, non-city agencies may create bottlenecks.

“Nothing alone is going to get you where you want to be,” Phillips said. “It is going to have to be a combination of things.”

He also suggested developing neighborhood plans, including the types of housing desired, housing densities and parking requirements. Even architectural styles can help the city to streamline its codes and permitting processes. 

Some residents providing public comment said they didn’t want to see the city legalize accessory dwelling units (ADUs), also known as “granny flats.” Still, Phillips said ADUs can help to increase density and allow homeowners to adapt their property to expand their own living space or create room for adult children or elderly parents. The city in 2018 voted down ADUs, which would have, at the time, allowed as many as 12,000 homeowners to build additional units on their properties.

Phillips also suggested increasing the density of some multi-family housing zones from 14 or 21 units per acre up to 30 units per acre. Densities currently zoned for 30 units per acre could be rezoned for 45 or 60 units per acre. 

Council member Naomi Duerr scoffed at the idea of densities in the 45-60 range. She said in her ward, some areas had some of the highest densities in the city—up to 40 units per acre—and they were facing issues with crime, inadequate parking and a lack of open space. 

“It seems like the living pressure of living so close in an environment like Reno…is at odds with our culture and our expectations of living,” she said. “What I’ve heard our actual planner say is we’re never gonna go there again. They said we will never do this level of dense development in Reno…because the results, the impact on people are not good.” 

No single approach will solve the problem

Phillips said there were tradeoffs to any approach.

“Some of this can be resolved by planning,” he said. “Density with the right planning can actually increase shared open space because you can build up taller over here, and you can clear space over here.

“These costs are absolutely real. But from the perspective of the tenants living in those apartments, I could say they are living there instead of elsewhere… If that housing development was not there, where would they be living instead?”

Other recommendations in Phillips’ report include a city review of infrastructure and a plan for end-of-life replacement and repair costs. That process, he said, would allow builders to have a better idea of infrastructure costs for their project. The current process is unpredictable and potentially risky in terms of cost. 

Protecting existing housing stock and adequately regulating short-term rentals should also be a priority. The mostly unregulated STR market in Reno, Phillips said, takes a meaningful amount of housing off the market for long-term occupants.  

“At the end of the day, it’s really just about ensuring that short-term rentals aren’t more lucrative than renting a unit for a long-term occupant,” he said. 

Council members were curious as to how Reno stacks up as compared to the several hundred other cities Phillips has assessed. Schieve wanted to know what grade Phillips would give the city based on other cities he’s reviewed. It’s a C, he said. No city has gotten an A.

Council member Meghan Ebert asked how Reno compares to others in developer impact fees. 

“Reno’s fees are not really its problem,” he said, adding that the fees aren’t too great. “The bigger problem with fees is when they’re unpredictable and when they come early. The amount is important, of course, but when they could be $100,000 or $10,000 per unit, and you don’t know—that’s really where it can get you in trouble.”

Other council members probed Phillips for details on what other cities have done, how Reno compares and how he would implement certain policies. He said it’s never a one-size-fits-all approach, and cities often need to figure out their own mix of policies and processes to solve their housing problems.  

“Nothing alone is going to get you where you want to be,” Phillips said. “It is going to have to be a combination of things.”