A Holistic Perspective by
Steve Schappert
The term “workforce housing” has long been used to describe affordable housing for individuals earning between 60% and 120% of the area’s median income. However, this phrase is now being reconsidered due to its exclusive connotations. Some argue that it implies that those earning less than 60% of the area median income are not part of the workforce. In an effort to shift the narrative, alternative terms like “essential housing” or “attainable housing” are gaining traction, emphasizing the importance of providing affordable homes for those who play essential roles in our communities.
The Missing Middle:
Essential housing serves a crucial demographic often referred to as the “missing middle.” These individuals earn slightly too much to qualify for investor-financed tax-credit properties but fall short of affording market-rate housing. They include essential workers such as nurses, firefighters, police officers, sanitation workers, and teachers. Recognizing the significance of this demographic is vital for building inclusive communities.
Challenges and Solutions:
Creating housing solutions for essential workers can be a complex task, and challenges vary by region. In states like California, where high land and construction costs persist, providing affordable housing is particularly challenging. Additionally, restrictive zoning ordinances can impede efforts to create affordable shelter for the workforce.
Communities must gather the necessary resources to offer alternatives, whether through new construction or retrofitting existing properties. Despite resistance from “Not In My Backyard” (NIMBY) proponents, many communities are beginning to take action. They acknowledge the importance of providing housing for all, even if it means stepping out of their comfort zones.
Mixed-Income Developments:
One approach gaining popularity is mixing affordable units with market-rate units in the same development. This strategy promotes inclusivity and helps reduce the stigma sometimes associated with affordable housing. Developers, municipalities, and financing tools all play roles in determining the success of mixed-income developments.
For example, Good Works’ Ashburn Chase development in Ashburn, VA, features a mix of affordable and market-rate units. This collaboration with home builder Toll Brothers and TM Associates includes units for people with developmental disabilities and various amenities. During the pandemic, resident service managers worked to secure federal rent subsidies, preventing evictions for unemployed residents.
Creating Walkable, Bikeable Communities:
Advocates for smarter growth, like the Coalition for Smarter Growth in the Washington, D.C. metro area, emphasize the importance of creating walkable, bikeable, and transit-oriented communities. This approach aims to bring multifamily housing closer to job centers and essential services, reducing the burden on essential workers.
Investment Potential:
From a real estate perspective, the affordable and workforce housing category continues to offer good investment potential. Low inventory and high for-sale prices make this sector attractive to investors.
Educating the Community:
One challenge in promoting denser multifamily housing is addressing concerns that it may negatively impact property values. Studies have shown that this is not necessarily the case. In fact, prices in mixed-income developments often continue to appreciate.
Getting Involved:
For REALTORS® and associations interested in addressing housing challenges in their communities, the National Association of REALTORS® offers a toolkit called “Expanding Housing Opportunity.” This resource provides guides, resources, and success stories to help individuals and organizations make a positive impact in their communities.
In conclusion, providing affordable and essential housing is not only a financial opportunity but also a moral and social responsibility. Shifting the narrative away from exclusive terminology and embracing inclusive approaches can lead to more equitable communities where essential workers have access to safe and affordable homes.
