Affordable Housing and Job Creation

Building affordable housing not only creates jobs in the construction sector, but also stimulates the local economy in less obvious but substantial ways.

According to an article called The Role of Affordable Housing in Creating Jobs and Stimulating Local Economic Development from the Center for Housing Policy, the development of affordable housing increases employment and spending in the local community, is an important source of revenue for local governments, and reduces the likelihood of foreclosure and the costs that are associated with it.

It’s not surprising to learn that the building of affordable housing creates jobs in the construction field and therefore supports businesses that supply the construction trade. But in addition, affordable housing further stimulates the economy when the workers spend their pay at the local retailers, health services, and restaurants. According to the article, the National Association of Home Builders (NAHB) estimates that building 100 new Low-Income Housing Tax Credit units can lead to the creation of more than 120 jobs during the construction phase. After the units are built, the residents continue to support about 30 jobs.

Local governments can also benefit from building affordable housing. Revenues from affordable housing include fees for permitting, zoning, utilities, as well as sales, income, or property taxes. NAHB estimates that 100 of the units when occupied by families generate $827,000 in local revenue immediately.

When families live in housing they can afford they will have more money to spend in the local community. Local business can receive benefits from the increase in the purchasing power of these families. Affordable housing that is also energy efficient will reduce the utility costs for the families, leaving them with even more money to purchase goods from local businesses. Additionally, builders of energy efficient homes stimulate the local economy by buying from local suppliers in order to reduce cost to the environment through transporting materials.

Affordable lending programs save the government money by reducing the chance for foreclosure. A study found that borrowers who received subprime loans were three to five times more likely to default on their mortgage than those who received prime loans through affordable lending programs. Local governments absorb many of the costs of foreclosures including boarding the property, trash removal, court and legal expenses, increased police and social services for the affected area, and demolition of severely distressed properties.

Increasing the support for affordable housing can be a way to create more jobs in North Carolina, but it can also stimulate local economies.

This is a short summary of the article, to read the full article click here.

A new start for a new decade

With the start of a new decade, I’ve been thinking about what the future holds for our country. I hope that in my lifetime I see an expansion of affordable housing, along with increased compassion for those in need, and greater acceptance of cultural diversity. One recent study showed some interesting promise that we are starting to move in the right direction in terms of building more diversity within our neighborhoods.

Last month the US Census Bureau announced that housing segregation between African Americans and Caucasians is at the lowest level our nation has seen in over a century. The statistics from the survey state that the average Caucasian now lives in a neighborhood that is 79% percent white, compared to 81% in 2000. The average African American lives in a 46% black neighborhood, down from 49%. The results come from the American Community Survey, which gathering demographics from 1 in 10 Americans between 2005 and 2009.

The study also showed that the country’s largest population gains were in the suburbs. However, unlike past trends now minority populations are leading the way to the suburbs. Over a third of the new suburban dwellers were Hispanic (13.3 million), along with 2.5 million African Americans.

So, what do these housing trends mean for our future?

This evidence shows that our country is starting to become more inclusive and less concerned about racial issues while moving into new neighborhoods. I feel that diverse neighborhoods create rich opportunities for individuals to learn from one another. This diversity enhances our public schools and allows for each child to see the world from a new perspective.

At the same time, it is clear that segregation still exists. We still have a ways to go before diverse populations are welcomed in every neighborhood. The study also showed that a large percentage of individuals still live in neighborhoods where the majority of people look just like they do.

Because of these neighborhood changes, in the future we may see contentious political fights over congressional redistricting. For instance, we could see a disappearance of congressional districts that once were majority African American. In the next couple of years we may also see new districts emerge that are majority Latino.

One thing the statistics mean for sure is that we will continue to have greater diversity in our country in the future. We should be prepared to nourish this diverse population and support new generations in finding healthy, safe, and affordable places to live.

To see the Census report click here.

For more information click here or here.