30 Million New Homes by 2030 ... Yup, It's happening.
Douglas Hayden
CEO and Founder of Arthroto. We Develop / Convert Unused Office Buildings into Residential, Hotel, and Condos, with State of art Prefabricated Solutions and Sustainable Materials. All to get Heads in Beds Faster.
How are we going to Build the 30 Million New Homes projected by 2030?
North American Municipalities are Paving the Way for Affordable Housing Solutions.
Introduction:
The affordable housing crisis in North America continues to be a pressing concern, with the ambitious goal of building 30 million new homes by 2030. To achieve this target, governments at all levels, particularly large municipalities such as New York City, Chicago, Los Angeles, Washington DC, and Calgary, must lead the charge. These cities have already made significant progress in implementing programs and strategies that will contribute to the massive effort required to build 30 million homes in the next seven years.
This ambitious goal requires a multi-faceted approach, involving new financial and financing options, adoption of innovative construction technologies, and the commitment of governments at all levels, especially large municipalities.
Let's Strat with the Outliers who are leading the way:
New York City: Pioneering Affordable Housing Strategies
New York City has long been at the forefront of addressing the affordable housing crisis. The city's ambitious Housing New York plan, launched in 2014, aimed to create and preserve 300,000 affordable homes by 2026. The plan's key strategies include streamlining the development process, implementing mandatory inclusionary housing policies, and investing in public-private partnerships to promote affordable housing development. As of 2021, the city had already financed over 200,000 affordable homes, demonstrating its commitment to tackling the housing crisis. Furthermore the City of NY has implemented a blueprint to convert unused office space to residential housing, why a pro rata formula that ensures up to 20% of conversions are set aside for affordable housing.
Chicago: Expanding Affordable Housing Opportunities
Chicago's Department of Housing has established the Affordable Requirements Ordinance (ARO) to increase the number of affordable housing units in the city. Under the ARO, new residential developments with 10 or more units that require zoning changes or involve city-owned land must allocate a percentage of units for affordable housing or pay fees to support affordable housing initiatives. Furthermore, the city's five-year housing plan, released in 2019, outlines strategies to invest in affordable housing development, expand access to homeownership, and preserve existing affordable housing stock. ?While 11 developments, representing 1,083 units and $398 million in funding garnered the new tax credits in 2019, this year 24 developments, accounting for 2,428 units and $1 billion in investment are setting the City up to accomplish their long term goals.
Los Angeles: A Comprehensive Housing Plan
Feeling political pressure to solve California’s severe housing shortage and ballooning homelessness, state lawmakers are pushing new bills to increase production of affordable homes and strengthen tenant protections against evictions and surging rents.
In Los Angeles, it has the will, but has not found the way! The city has implemented a comprehensive plan called "LA's Housing Element 2021-2029." This plan outlines various strategies to address the housing crisis, including zoning changes to accommodate higher-density development, incentives for affordable housing construction, and funding programs to support the creation and preservation of affordable homes. Additionally, the city has established the Affordable Housing Linkage Fee, which requires developers to contribute funds to support affordable housing initiatives when constructing new market-rate residential or commercial projects. Unfortunately there is no way for the State of California to come anywhere near their required housing numbers due to anemic funding models that are no where near what is required. For a state that makes Billions on taxing the sale of houses you'd think they would wake up to the fact they need to figure the housing crisis out, and fast.
Washington DC: A Bold Housing Initiative
Washington DC has set an ambitious goal of creating 36,000 new housing units by 2025, with at least 12,000 being affordable homes. DC Mayor Muriel E. Bowser's administration continues to seek ways to achieve?its goal ?of building 12,000 new dedicated affordable housing units by 2025.To achieve this target, the city has outlined several strategies, including offering financial incentives for affordable housing development, implementing inclusionary zoning policies, and prioritizing affordable housing on public lands. Furthermore, the city has established a Housing Production Trust Fund, which provides financial support for affordable housing projects.
Calgary: Addressing Housing Needs Through Collaboration
Calgary's approach to tackling the affordable housing crisis emphasizes collaboration between the public, private, and non-profit sectors. The city has established the Calgary Housing Company (CHC) to manage and develop affordable housing properties. Along with CHC, the City and Province are working with the Canada Mortgage Housing Agency (CMHC) to find financially viable options that ensure developers and builders can meet the demand for affordable housing. Additionally, the city is focusing on developing mixed-income communities, streamlining development processes, and supporting innovative housing solutions such as modular and tiny homes, plus has North America's most advanced program to convert unused office space to residential housing.
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New Financial and Financing Options
To build 30 million new homes, we need to explore innovative financial and financing options. One such option is the expansion of affordable housing tax credits, providing incentives for private developers to invest in affordable housing projects. Additionally, public-private partnerships can facilitate the pooling of resources and expertise to develop affordable housing solutions.
Another possibility is the introduction of low-interest loans and grants for affordable housing construction, allowing developers and non-profit organizations to access funds at a more manageable cost. These loans and grants can be designed with flexible repayment terms to accommodate the unique challenges faced by affordable housing projects.
HUD Secretary Marcia Fudge?unvalued details of the housing provisions in the administration’s proposed “American Jobs Plan,” President Biden’s $2.3 trillion infrastructure proposal. While the administration previously proposed a total of $213 billion in housing investments, Secretary Fudge announced a proposed?increase to $318 billion, along with details of the spending request.? $45 billion for the national Housing Trust Fund for construction and preservation of homes affordable to people with the lowest incomes, and 2) major investments to rehabilitate and preserve the nation’s public housing stock.
Additionally in Canada, the Province of Ontario has made it a top priority to build 1.5 Million new homes by 2030, and that may still not be enough!
Ontario’s 1.5M figure was born out of a?February 2022 report ?from the Housing Affordability Task Force. To meet the goal within the allotted timeframe, Ontario must aim for approximately 150K housing starts per year.
In 2021, the province mustered 99,566, and saw 96,080 housing starts in 2022. According to recently-released?data from the CMHC , if the level of activity seen in January keeps pace throughout the rest of the year, Ontario will have 71,545 housing starts in 2023.
However, a?June 2022 report ?from the CMHC estimates that Ontario will need 1.85M homes by 2030 in order to restore affordability.
ab Iorwerth noted that the CMHC’s projections do not reflect the proposed changes outlined in Bill 23, but once the policies “become clearer” the data will be updated.
Both Ontario’s and the CMHC’s figures predate the federal government’s?Immigration Levels Plan , which aims to welcome 465K new immigrants in 2023, 485K in 2024, and 500K in 2025.
Embracing Factory-Built Housing and New Technologies
Is the answer new technology, or perhaps proven methods brought up to date with new construction methodologies?
Incorporating factory-built housing and new technologies is essential to achieve our ambitious goal of building 30 million homes. Prefabricated and modular construction methods can significantly reduce construction costs and time, making housing more accessible for those in need. By employing advanced technologies such as 3D printing and robotics in the construction process, we can further enhance efficiency and affordability.
Additionally, implementing energy-efficient technologies and sustainable materials in new homes can reduce long-term maintenance costs for residents, further contributing to the overall affordability of housing. As we work towards our goal, embracing these innovative construction methods and technologies will be crucial to ensure that everyone who wants a home will have access.
Government Commitment at All Levels
Governments at all levels – federal, state, and municipal – must be committed to addressing the affordable housing crisis. Large municipalities, in particular, need to take the lead in developing policies and programs that support affordable housing development. This includes measures such as:
Conclusion
Building 30 million new homes by 2023 is an ambitious but necessary goal to address the affordable housing crisis in North America. By exploring new financial and financing options, embracing factory-built housing and innovative technologies, and ensuring government commitment at all levels, we can work together to make housing accessible for everyone who wants a home. It's time for all stakeholders – from policymakers to developers to citizens – to come together and take action to solve this pressing issue.
Douglas Hayden can be reached via Linkedin
Marketing, Certified Residential Specialist, Realtor - MD, DC & VA
1 年Thanks for sharing, hope this holds true.