Construction & Real Estate
Making Affordable Housing a Priority
BY KEVIN SMITH
OUR COUNTRY is in a severe housing crisis, compounded by a lack of supply, high interest rates, shortage of construction labor, increase in material costs, and restrictive zoning, to name a few. Some might even say we have a perfect storm where all these factors have come together to create a dynamic where more and more people cannot afford their housing. This crisis doesn’t just affect those experiencing homelessness or struggling to get out of poverty. Low to moderate-income workers, skilled laborers, college graduates, police officers, teachers, and others are impacted by housing costs that are too high. Across the housing continuum there are simply not enough units. In functional housing markets, there would be ample housing at all levels. The largest group of people affected by this crisis are those earning
THE HOUSING CONTINUUM Market Home Ownership Market Rental Housing Affordable Home Ownership Affordable Rental Housing Social Housing Transitional Housing Emergency Shelters Homeless
DELAWARE BUSINESS
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November/December 2023
between 30% and 100% of the median income (about $30,000-$90,000 in New Castle County). Whether they want to find an affordable place to rent or buy, there simply is insufficient supply. Through our policies, land use decisions, indifference to the problem, and attitudes like NIMBY (or Not In My Backyard), we have collectively decided—whether consciously or not—that affordable housing is not a priority. Perhaps you or someone you know has thought the following: Who cares if someone must pay 50% of their income on housing? I don’t want that type of housing or those people living near me. According to the National Low Income Housing Coalition, the U.S. has a 6.8 million shortage of affordable housing units; in Delaware, there is a need for over 21,000 units to meet the need. It’s imperative that we produce more housing wherever and however we can. Meeting this need will require outside-the-box thinking to find innovative solutions to this growing problem. Furthermore, addressing the crisis can’t be effectively addressed in silos. It will take all segments of society—businesses, government agencies, civic associations, faith groups, nonprofits, and individual citizens to get on board. There are several solutions that can help address the shortage today. One approach is to expand the availability of Accessory Dwelling Units (ADUs), which are small residences that are attached to existing homes. The cost to rent an ADU is often more affordable than other types of rentals. Municipalities are also looking at inclusionary zoning, which requires new developments to set aside a certain percentage of units for low- and moderate-income residents. This approach incentivizes forprofit builders with density bonuses to balance out the affordable units. Habitat for Humanity of New Castle County has built 300 homes across New Castle County since 1986 and is constantly looking for new housing solutions. For example, we are working with faith groups with available land to connect our missions to produce affordable housing. Recently, we launched Almost Home, a rent-to-own program that gives applicants whose credit scores are just below our requirements a chance to rent for a year while they repair their credit. After improving their finances, they are elevated to our regular Homeownership Program. Lastly, to make our homebuyer program available to more families, we have recently increased our income range from 60% up to 80% of median income per family size. We can navigate the storm and address the housing crisis in Delaware. The first step is to come together. n 29
