Affordable workforce housing is a topic that is gaining ample attention amongst government officials. Even the real estate community takes an interest on it along with housing affordability and policy. It is a complicated issue as it’s a housing supply concern and an affordability problem. It stems from the fact that earnings of the middle- and moderate-income households have stayed stagnant for the last two decades.
The concept of affordable workforce housing
According to Maxwell Drever, workforce housing usually caters to households and families that earn over 60% of the AMI (area median income) and to about 120 to 150% of the AMI in the highest-cost metropolitan zones of the country, for instance, New York City and San Francisco. And while you have the subsidies accessible for the households generating an income less than 60% of the AMI, there are lesser subsidies accessible for those generating a payment more than this. Hence, the mix of the standing wages and increased rent developed issues in the affordable workforce community for many people.
The latest reports highlight that about 25% of the renter households spend almost half of their earnings on their rent. And this percentage can maximize the number of renter households to an increased number, that it’s estimated to rise quicker than most of the new families buying houses.
The essential things
It is essential for most people to stay at a place close to their workplace, especially for those workers who impact the local economy. The vital employees here are the emergency service workers, teachers, retail clerks, and nurses. Maxwell Drever says that most of these employees find that the new houses are overpriced and not within their reach. In the urban areas and close to the employment zones, the development and land expenses are high. It compels people to stay at a place that is far away from their workplace and increases the commute cost and time. When these employees can live closer to their workplace, the total community can leverage the benefits. There is traffic congestion ease and better commute times, a diverse neighborhood, and scope for families to stay and grow at one place. It helps the economy to strengthen as well as the essential workers and employees can get better retained.
However, one can’t say for certain that any new construction will resolve the issue of workforce housing. Hence, rehabilitating and preserving old rental housing is one of the affordable options to start with. It is necessary to address all the requirements of the affordable workforce housing community. It is essential for the operators, lenders, and municipalities to work together and arrives at ways to preserve and maintain the workforce housing. With its annual Scorecard, the Federal Housing Finance Authority (FHFA) played an influential role in maximizing the focus on the affordable workforce housing needs. Furthermore, they implemented the “Duty to Serve” regulation that works in a way to garner more emphasis in preserving the affordable workforce housing communities.