Affordable housing remains the single most significant issue facing our nation today. In prior times of high housing costs and high interest rates we created means to make affordable housing available. Providing financial assistant for a down payment helped but now the actual down payment requires a substantial amount. Various mortgage scenarios VA, FHA, Variable Rate and other options were devised to reduce the monthly payment amount. Some of these actions were private and some public. What is government doing in response to the current problem?
Often, we hear the claim government actions cause the problem. Some other people express concern for the lack of public sector intervention. Some claim that regulations are too restrictive, and reviews create lengthy delays. The common mantra is “time is money.” Reducing review times demands more flexibility in zoning we are told. Reducing the” red tape” is claimed as a means to reduce housing costs. In numerous jurisdictions various zoning regulations and reviews have been minimized to both reduce the processing time and provide flexibility in zoning restrictions. These changes include reducing minimum lot sizes for housing, reduced set back requirements, allowing for increased density, allowing private roads rather than wider public streets and reducing the need for sidewalks on both sides of the street. These are often incorporated into planned unit developments. A focus on mixed use allowing various building types in a unified development including detached single-family housing, townhouses, multifamily and commercial creating a self-contained livable area. The hope is that reducing these requirements provides flexility by lowering overall land costs allowing builders to lower their costs. Government can not alter the cost of construction materials which are governed by the market.
Tax credits to developers/builders may also help. Certain bonuses such as floor area ratio, lot coverage, parking requirements can also help. Some other innovative development concepts involving public/private group-initiated actions could allow further room for lowering costs. Various public sector funding options can also help.
Years ago, a 1200 square foot 2 bedroom and 1500 square foot 3-bedroom house addressed the needs of most people. As time passed lot sizes and larger square footage housing demands boomed. Some of this larger size housing was based on legitimate needs. Some however reflects the wonder and success of modern-day marketing. Perhaps 1500 square feet is somewhat small for today’s family needs. Even though families tend to be smaller today the spatial needs do necessitate added size for our lifestyle today. If we need 3500 square feet with a 3-car garage certainly is debatable. There is much latitude between 1500 and 3500 square feet to create a more affordable house which addresses a contemporary lifestyle.
If we as a society can adjust to less square footage the price of housing should be less. If the regulations are adjusted to to minimize delays and allow more creativity in design hopefully the price would also be less per unit. If the cost per square foot can be reduced due to size and the number of housing units increased on smaller lot areas, then the cost of housing can decline. As more housing can be built and sold the supply is increased. Hopefully the law of supply and demand could further act to bring prices down.
We must provide affordable housing. As a community we must recognize some solutions require more government involvement including making money available to help. At the same time developers must also utilize the more flexible government regulations to lower their costs as well. This does not have to mean higher taxes or creating ineffective regulations, if we use our heads.
Phil's Personal Perspectives 