The expensive affordable housing solution the city council looks at Tuesday

The economics of paying $350,000 to sell a house for $140,000

A benign-looking item on last week’s Economic Development committee meeting ended up being surprisingly explosive.

A contractor bidding on an empty lot the city owns and would like to see developed seems like a short news brief at best.

But the details are far more interesting - and they garnered a strong response by some of the city’s Economic Development Committee members.

Those details? The city under the plan would pay developer Brian Luedtke Design Group $350,000 to build a modular home on the site. It would then sell that home to someone who is income-qualified as an affordable house.

It would sell that house for $140,000.

ED members said they understood that the point here wasn’t to make money, of course, but for some of them that seemed like a hard pill to swallow.

And that’s the first time the city received a bid at all on the lot after several attempts to get developers interested in it.

Here are the economics of the decision and what it says about realities of building affordable housing.