Romer: Government’s role in housing affordability
Affordable housing (subsidized housing for low-income people) and housing affordability (the ability of people to pay for housing) have been an issue in Eagle County since the chairlifts started turning in the 1960s.
Tourism fuels our economy, opening up jobs for locals and seasonal workers, but affordable rentals are hard to find. Many landlords can earn more from short-term rentals to tourists than long-term leases to residents. As a result, if local communities value retention and business growth, local governments must be engaged in helping ensure housing is affordable to the local workforce.
The cost of putting a roof over your head is obviously personal and impacts your quality of life. But it’s also a community economic issue in that the cost of housing can either help or hinder the ability to attract and retain a workforce.
Obviously, demand is a key driver. Our mountain communities are popular, so as more people want to move here and as local businesses plan to grow and expand, the greater the demand for housing. That, however, is not the full story. When the supply of land is restricted by zoning a consequence is a restrained housing supply and subsequent increase in prices.
There’s a great column by Paul Kupiec and Edward Pinto in the Wall Street Journal that helps outline the issue. The authors’ final paragraph is a concise summary:
“Rather than promise the impossible—making housing affordable by decree—municipal governments should embrace practical solutions. They should adopt land-use and building code regulations that reduce development costs. They should expedite approval processes, lower impact fees and taxes, and reduce other unnecessary regulations. Only by adopting measures that trim development costs can municipal governments stimulate the production of new housing that is more affordable for everyone.”
This is great advice to keep in mind during ongoing conversations about affordable housing and future development proposals. It is also a meaningful way for government to be engaged and involved in addressing our housing issue.
Growth management is an ongoing concern for state and local elected officials in Colorado, and every community must determine which approach best serves its unique needs. For some, this may mean closely examining public policies used to guide the creation of transportation systems, water supply, open space and housing.
Even in a robust economy, wages do not always keep up with the cost of housing. Public policy (government) can help control direct development costs according to a community’s wishes.
Sometimes, however, those tools inhibit housing that is affordable to current or prospective residents and may affect a community’s ability to attract and retain an adequate workforce. It is important that local governments examine their growth regulations to understand and lessen their impact on developers and, in turn, prevent workforce housing from being built.
Common arguments are that increased housing will increase school costs, traffic congestion, noise, pollution and crime. Communities may also fear that new housing developments will cause property values to decline. Research has shown that these concerns are “unrealized” and “overstated.”
The supply of housing depends on local planning practices, policies, and community engagement. Many local planning procedures currently in place enable community opposition that stalls housing production. Reshaping local regulations allows jurisdictions to make a lasting impact on the supply of affordable housing.
Reducing regulatory barriers to reduce the time and cost of approval processes is an appropriate way for local government to be engaged in helping address our housing issues.
Chris Romer is president and CEO of the Vail Valley Partnership, the regional chamber of commerce. Learn more at www.vailvalleypartnership.com.