A lack of affordable housing remains a serious issue. Many Americans are being priced out of the cities they work in, and families are struggling to provide shelter for their children.
This is not just a personal issue: It’s a social one — and one with long-term impact. To find out some steps that can be taken to tackle the problem, we asked the experts of Forbes RealEstate Council how people in the real estate industry can make a positive impact on the housing market in order to help address the issue of housing affordability. Here’s what they had to say.
Members discuss making a positive impact.Photos courtesy of the individual members.
1. Partner With Other Affordable Housing Stakeholders
Local officials are looking for ways to maintain and preserve affordable housing. You may be able to take advantage of subsidies to help underwrite your efforts. You could also meet with a local affordable housing developer or active not-for-profit organization to learn and discuss partnerships. Also, consider partnering with large institutions in your area, such as universities and hospitals. – Deborah Rabbino Bhatt, Vesta New York
2. Fight For Mobile Home Park Development
Regulations have made the development of affordable housing in the U.S. economically unviable or impossible. There is no more clear example of this than in the mobile home park business. Despite the fact that there is overwhelming demand for the product, there are fewer MHPs each year due to municipalities condemning parks or refusing to grant permits which allow their development. – Hunter Thompson, Cash Flow Connections
3. Develop Relationships With Community Leaders
Developing relationships with the leaders in your municipality is key. Affordable housing is a priority for these leaders and they are looking for experienced, qualified developers that can help them solve this problem. Many cities will assist you with subsidies so the project is economically viable for you as the developer and the community gets the affordable housing built that it needs. – Doug Fath, Wealthy Passion
4. Participate In Home Buying Programs
Real estate industry professionals should prioritize affordable housing initiatives for their community by ensuring funding for down payment assistance programs, affordable dwelling unit programs, minority homeownership programs and forgivable grant programs. Encouraging homeownership to all socioeconomic levels ensures the health and economic welfare of a community. – Hillary Legrain, First Savings Mortgage Corp.
5. Give Back To The Community
It’s tough out there. Corporately and individually we can give back in many ways. We need more brave entrepreneurs who will take a chance on those in need and go into neighborhoods in need of revitalization and rebuild the housing stock with the millions of vacant units out there. The experienced can also help by hiring and sharing their knowledge to help increase incomes to offset rising prices. – Kent Clothier, Real Estate Worldwide
6. Invest In Opportunity Zones
I think you will see that Opportunity Zone investing will start to address this issue, by providing housing in areas that might not otherwise be developed. With rising construction costs, the tax inventive offered by QOZ helps to offset costs which can keep rents in a more affordable range. Taking advantage of this program, while keeping units very efficiently designed in urban areas, will help. – Meg Epstein, Ca South Development
7. Promote Suburban Areas To Virtual Workers
One solution that I could see balancing the scale, would be for the commercial real estate side to move more jobs out to the suburbs and/or areas with lower income. Another possible solution would be to put a greater emphasis on virtual work environments. Allowing people to work from their homes or satellite locations helps to break the correlation between area demands and affordability. – Justin A Core, Core Group Real Estate
8. Provide Full Transparency About Home Ownership Costs
A key element to housing affordability is to offer full transparency on the price of buying (and owning) a house. More often than not, buyers have no idea how much a house actually costs and this often gets them in over their heads. We need to provide buyers with a clear path to purchase so they can budget accordingly. – Bill Lyons, Griffin Funding
9. Find Ways To Make The Cost Of Land Lower
Developers have a hard time building affordable housing in markets, as their entry price of the land is high and the only way to make the projects pencil are by creating luxury assets, which have greater margins. The key to having greater affordable housing comes from allowing greater density on a piece of property thereby reducing the cost of each unit to allow for more units. – Ridaa Murad, BREAKFORM | RE
10. Streamline And Standardize The Development Process
Many areas simply can’t keep up with building at the pace of demand for housing. This is, in part, due to the complicated, lengthy and expensive development process. To alleviate this, decision-makers can develop standards for the development process and transparency in the development fees. A more streamlined and standardized process will make it easier for developers to meet the growing demand. – Annie Dickerson, Goodegg Investments
11. Treat Tenants Well
One thing that I do here in NYC is to keep rent increases low. All of our tenants pay below-market rents, but my goal is to make sure that they have the best deal in town. I’ve found that the quality of my tenants rises the better I treat them. Don’t be a slumlord. At least for me, I make enough, and the costs of finding a new tenant are expensive too. – Holly Williams, MQ Ventures