Prosperity depends on more affordable housing

The Columbus Dispatch, March 1

When it comes to making an area livable, some requirements are non-negotiable. People want good jobs, good schools, safe streets, short commutes, leisure-time options and affordable housing. It’s that last item that is becoming more difficult to check off in central Ohio.

For starters, what is affordable to some may be wildly out of reach to others. Low-income families that spend more than half of their income to keep a roof over their head face an estimated shortage of 54,000 housing units lacking to fill their needs.

The Affordable Housing Alliance of Central Ohio has a plan to tackle that gap with a combination of new home construction, existing home repair and assistance for renters. With 20 members including Columbus Metropolitan Housing Authority, Community Shelter Board, Homeport and United Way of Central Ohio and others including area banks engaged in its Strategic Advisory Council, the alliance appears well positioned to make an impact.

The alliance is focused on those at risk of becoming homeless and who struggle with poverty. These families cannot improve their circumstances without the kind of help the alliance and its partners are committed to offer to help shrink the housing gap at the low end of the affordable housing spectrum.

Just as distressing is the ballooning shortage of homes for those better positioned economically but who still face intense competition for the inadequate number of homes available to middle income families.

Recent stories by reporters Jim Weiker and Mark Ferenchik highlight how hard it is becoming to buy a house in central Ohio, as emphasized by Columbus being named the seventh worst market in the nation for homebuyers in February.

The conundrum is of concern not only to those who would like to move or buy their first home but also to residential developers, community leaders and government officials. At stake if this trend continues is whether central Ohio can continue the kind of robust economic growth it has enjoyed in the past decade and fulfill expectations of adding one million new residents to the region by 2050.

In national rankings, Columbus consistently scores high among cities of its size for affordability — which likely contributes to the prediction for population growth — but the area’s attractiveness for the business relocation and expansion anticipated to fuel that growth could be threatened by frustration new residents could encounter in finding a place to live.

Several factors are at work and must be addressed to enable the region to realize its growth potential.

House-flippers who buy property in rebounding distressed areas may help rejuvenate entire neighborhoods by renovating homes in decline and offering them to new buyers, but they also contribute to pricing out residents whose ability to remain depends on keeping rent or property taxes low. Sales of South Side homes on Siebert Street are a case in point: Properties bought for $40,000 or less have sold for more than $200,000.

And as residential developers lamented last fall, it is getting harder to build new homes for prices that buyers can afford under $300,000. Year to year, the median sale price of Columbus homes has steadily risen from $170,000 in 2016, to $181,500 in 2017, $195,000 in 2018 and $209,900 in 2019. In comparison, the median price of a new single-family home in the area in July was $339,000.

The Building Industry Association of Central Ohio was smart to put its mostly-annual Parade of Homes on hiatus for 2020 while figuring out how to promote new homes that are affordable for more families. The move was prompted by a striking reality: of 14 new homes built for last year’s parade with prices beginning at more than $700,000, only three had sold by early February.

Builders point to anti-density sentiment as well as high costs of regulation, land, materials and labor with driving up construction costs and suppressing the rate of activity necessary to meet demand. A study in December 2018 found central Ohio should be building more than 14,000 new homes and apartments a year but actual production fell far short at just about 8,000.

Suburbs are joining Columbus in grappling with housing growth need. At two extremes are Pataskala and Whitehall, both eastern communities.

With more than 1,000 new homes proposed or under construction, Pataskala enacted an unheard of six-month moratorium in October on additional residential development. The pause is intended to help the Licking County city update its comprehensive plan for design standards and impact fees to help pay for roads and other infrastructure.

Whitehall, which has a history of creative approaches to help long-time and prospective residents buy and keep their homes, has rolled out the welcome mat for newcomers. It has courted mixed-use development while requiring at least 20% of future housing to be workforce units — measured as being affordable to those making up to $47,000 annually (about $22.60 an hour), or 80% of the area’s median income.

Not afraid of embracing density where it makes sense along transportation corridors, the suburb is seeking a developer for up to 700 residential units at the northeast corner of East Broad Street and South Hamilton Road. Meanwhile, construction is about to begin on 140 new units of workforce and affordable senior housing in partnership with Homeport on Etna Rd.

It will take creative new approaches by private and public developers and lenders, continued collaboration among government and nonprofits, a little less NIMBYism and a little more tolerance for density to get central Ohio back on track to meet housing needs. This region’s continued prosperity depends on solving stubborn housing challenges.

Online: https://bit.ly/2TvQpTw