Homes matter.
Having a secure, comfortable, and predictable living situation is crucial for overall well being, allowing individuals to thrive in their everyday lives and engage more fully with their communities.
When housing is out of reach, it doesn’t just affect individuals; it disrupts the entire flow and dynamic of our communities. Teachers, nurses,mechanics, firefighters and those who comprise a community run are being priced out. The shortage creates scarcity and drives prices up. Housing is an inelastic good. This means that everyone needs housing and has to pay for it regardless of the cost. It is difficult to quickly increase the supply of housing.
We need to build enough supply to keep pace with the growth in new households, new jobs being created, seasonal visitors and our long-term residents, the fuel of our communities. When we talk about building enough housing, it is not just about putting up more boxes or contributing to sprawl. We want to build neighborhoods– complete communities where people can go to work, have a social life and age in place if they choose. We also want to care for our environment, and protect our natural resources. How do we build housing that creates a strong sense of community for everyone with infrastructure that we can afford to sustain over time?
First, let’s prioritize places that already have infrastructure if possible. If we are extending infrastructure, ensure we are not doing it in ecologically sensitive areas.
Secondly, focus on creating communities that promote opportunity, ensuring a high quality of life for everyone This is really what makes a community thrive. We need to create opportunities for all income levels and we need more supply at affordable price points to support our workforce.
Our region is changing. We no longer see the typical nuclear family the current housing framework is set up to serve. A majority of households are made up of single adults or two adults with no kids or “empty nests” at home. We need housing solutions for all types of households. What we have today are single family homes that are not affordable to many residents.
To respond to these changes, we need housing solutions that reflect the full range of household types and income levels. For those making less than $25K/year or less (rents at $600/month or less), there will be a gap between what it costs to build and what they can actually afford. A subsidy will be required. For those making $50K/year or less (rent at $1250/month or less), these folks will need some incentives to bring the cost of rent to an affordable price point. For households earning between $50,000 and $75,000 an attached townhouse or condo could be in the realm of possibility. However, we still need flexible density and some sort of incentive such as a Payment in Lieu of Taxes (PILOT) or Neighborhood Enterprise Zone (NEZ) to achieve these price points. For those making over $100,000/year, we can still build homes at this price point, as long as we are not requiring a big lot and minimum square footage price points.
We need some action in the community to organize around housing. We can’t be afraid of discrete density and continue to regulate out the opportunity to create new housing types. If we do this then we are not creating opportunities for those people who need to be able to live here to serve the community.
Our costs are high in northwest Lower Michigan and they have a broad range depending on which county. Despite the high costs, some nonprofit partners like Homestretch and others have demonstrated that it’s possible to bring down the construction costs and keep their units affordable. Typically, construction costs are around $275-$375 per square foot depending on factors like the level of quality of finish and the availability of contractors during the building season. Outdated land use regulations don’t allow us to build smaller units on smaller lots, creating additional barriers. If we can reduce the cost of land, we can reduce the amount of subsidy necessary in order to bridge that gap.
There are many different costs associated with development including land acquisition, construction, design, permitting/professional fees and financing. All of these get combined for the final cost of the home or apartment or condo. The government does not control 100% of any of these things, but it can influence a share of all of them. We can influence the cost of land by allowing more homes on an acre.
If we have water and sewer, we should think about smaller homes on smaller lots. We can also think about narrower lots. A little cottage does not need a huge lot. Some do not want a large yard to maintain. Our units of government can play a role in reducing the overall cost of housing, but it needs to be supported by the public and through developers willing to work with the government and use the new tools available.
Solving our housing needs and challenges requires more than just construction. It requires intention, collaboration, and understanding of the needs. Zoning policies must be aligned, and development practices must be up-to-date and adapted to the realities of the people that live and work in our communities.
Smarter land-use supports growth, prioritizing affordability brings opportunity and thinking about our environment helps with sustainability. Together we can all have a place to call home, making it a reality for everyone, because Homes Matter.