Housing America's Workforce

There are many terms in one’s housing vocabulary for which there are not universally accepted definitions. I recently returned from a Washington DC meeting of the National Association of Home Builders’ Workforce Housing Subcommittee, chaired by Greg Vatterott, a St. Louis home builder. Experts there spoke of differing definitions for “affordable housing” versus “workforce housing.” They noted that “affordable housing” is broadly thought of among the general public as housing for the poor. It is housing for the “low and no income” segments of the population.

By contrast, many of these experts defined “workforce housing” differently, often calling it for those households earning between 70 and 120% of a local area’s median income. These views illustrate the fact that a one-size-fits-all solution is not in order for the various segments of the population who are in need of safe, decent, affordable shelter.

My primary interest in this topic will not be the same as it is for everyone else who shares an interest in housing. Many of those differing interests are quite noble. I am focused on “workforce housing” and how we can get the private sector positioned to meet the substantial demand. Either we have to devise a way for people to earn more or we have to build the housing at a lower cost. The only ways to build it at lower cost is one or more of the following: smaller, cheaper, denser. Doing this is substantially within society’s power, through government regulations—or more appropriately put—the absence of excessive government regulations, if we—as a society—have the will to do it.

National data claims that a $1,000 increase in housing prices means that an additional 250,000 families are unable to purchase a home. For those in the workforce with modest incomes, it is very small swings in housing prices which put hundreds of thousands in the market—or out of the market—in their quest for safe, decent shelter.

By Patrick S. Sullivan
Executive Vice President
Home Builders Association of St. Louis & Eastern Missouri

In addition to the need for fewer restrictions/regulations we simply need more resources to produce more housing in this country and here in the St. Louis Metro Area. Our workforce does not have options that decent safe and affordable. What is more important to an employee, parent, child or anyone else for that matter than a place to call home.

The affordable housing industry, those of us producing housing across the economic spectrum, has scant few places to turn for resources. Our collective community needs to affirm not only the importance of housing for everyone in our community but also the understanding that when we produce housing there is a direct and significant economic impact in our region. Roofers, carpenters, plumbers, electricians and so many more trades are put to work. Taxes are paid, materials are bought and in the end homes are produced.

Housing is not a four letter word and we need the courage to push for the resources to significantly produce more homes across the country and here in St. Louis.

Chris Krehmeyer
President/CEO
Beyond Housing

[quote=Chris23]
Well said Chris but I also hope we as a region will have the courage to talk about and pursue strategies to produce truly affordable housing. While I recognize the need for housing at the 70 - 120% income range, we simply cannot ignore those making less than half of median income who are vital to our communities - the clerk at the grocery store, the bus driver, the home health care aide, and more. According to the most recent National Low Income Housing Coalition's Out of Reach report, "the cost of affordable housing climbed for the eight consecutive year, continuing to outpace the wages of the low-wage households who need it most..." More resources are deperately needed and more people realizing that this is an issue in our very own communities may help lead to those resources.
Kimberly McKinney
CEO, Habitat for Humanity Saint Louis

The definition of affordable housing in longest use may be the one used by HUD. Housing costs greater than 30 percent of the monthly gross income makes a household "cost burdened". Monthly housing costs greater than 50 percent is "severe cost burden".

Using this definition means than any household can have affordable housing issues, regardless of income. For example, if one is 26 households in St. Charles County face foreclosure issues it may be that many are middle-to upper-income households that purchased or re-financed homes with mortgages that were burdensome.

The 2007 report on housing from the Harvard Center for Joint Housing Studies has a lot of information about the expansion of housing cost burdens across income groups. http://www.jchs.harvard.edu/

The more recent use of the term "workforce housing" may have been created to describe housing intended for extremely-low and low- to moderate-income households. Or, perhaps workforce housing is more a descriptor of the household type and location and less of the income-to-cost ratio?

According to an editorial in Shelterforce magazine, Summer 2007, referencing the Harvard University Joint Center for Housing Studies' "State of the Nation's Housing 2007" (cited above)..."one in seven households pays more than half its income for housing. And the bite is bigger for low-wage and part-time workers, retirees, and the disabled."

Providing decent, safe, and sanitary affordable housing is a minimum goal for the nation's federal housing department and by extension, for the many participating cities and counties across the nation partnering with them and with for profits and non-profits, average citizens, the states, and others dedicated to improving and increasing the affordable housing stock, to strengthen neighborhoods and communities.

I am encouraged that FOCUS St. Louis has taken on the challenge to help inform the St. Louis bi-state region about the important issue of affordable workforce housing. Congratulations!
Ken Hise, CD Division Manager
St. Clair County Grants Department