Lack of affordable housing likely to drive hardworking citizens out of Anchorage
By Michele Brown
What would you do if you had to choose between feeding your family or paying the rent? It’s a choice thousands of hardworking Anchorage families now have to make. But what may surprise you is that it’s not just the homeless or the unemployed who struggle to get by.
So what has changed from the good old days of wealth and prosperity combined with an annual PFD check?
Over the last ten years, as Anchorage grew from a modest 225,000 residents to just around 300,000, the supply of housing within the community has become seriously inadequate. A shortage of housing combined with wages that failed to keep up with the cost of living are causing many middle class, hardworking families to make those wrenching financial choices.
For example, the average cost of a single family home has increased 55 percent while the average family income only rose 39 percent. The average rent for a two-bedroom apartment alone has increased 58 percent. These prices translate to a remarkable income reality: to live in our community, Anchorage households must now earn a whopping $100,000 a year to afford an average priced home, $65,000 a year to afford a condo and $50,000 a year to rent a 2-bedroom apartment.
So how did this housing crisis come to life? New housing construction is dangerously low. Market conditions are no longer favorable for redevelopment of existing, aging housing stock. The rental vacancy rate is just 1.9 percent and recent housing reports indicate that Anchorage will need about 9,000 new homes built over the next 20 years just to meet projected population growth.
At the same time, the three largest occupation sectors, retail sales, cashiers and fast food workers, are making below $25,000 a year. Nearly half of Anchorage families are spending 35-75 percent of their salary just to pay for their housing.
The result is an economic meltdown for Anchorage that will come in the form of even higher housing costs, less property taxes collected, increased homelessness, and an exodus of a stable workforce migrating to more affordable communities.
In very real terms, the housing affordability gap means that housing costs have climbed so high that it is no longer affordable for young adults to start careers here, or for some middle income families and seniors to stay here.
So what are some steps we can take to turn the crisis around and save our community from future economic adversity?
Promising strategies were recommended by the Mayor’s Kitchen Cabinet Work Group on Affordable Housing (WGAH), a volunteer group of community and business leaders whose goal was to look for policy changes to spur housing development in Anchorage.
One important step is to empower a partnership or existing entity to specifically plan for, encourage, and coordinate housing development. Anchorage has various promising housing plans. It’s time to put them into action.
Other recommendations from WGAH include: assigning a single project advocate to be responsible and accountable through the entire permitting process for multi-family, housing redevelopment, and affordable housing developments. Increase available funds and maximize existing funds by coordinating with federal (HUD), state (AHFC) and other sources. Institute innovative and alternative tax and financing models and reduce development infrastructure costs. Additional suggestions made by WGAH can also be found at the following website: http://www.alaskapublic.org/wp-content/uploads/2012/07/05-10-2012-Housing-Work-Group-Memo.pdf
WGAH recognizes that these recommendations made to Mayor Sullivan, if implemented, are just the first steps we might take.
To spur sufficient growth to meet the community’s need, we must all continue to identify and implement creative strategies that actually move the needle on housing development to ensure affordable homes for all of Anchorage’s residents.
The current housing crisis is everyone’s problem. It affects your neighbors, your friends, your co-workers, your children. And someday, it may even affect you. But if we work together, we can create large scale, meaningful change that will help not only those in need, but all of us.
Michele Brown is president of United Way of Anchorage.
About United Way of Anchorage
United Way of Anchorage is the leader in mobilizing the resources of individuals, companies, government and labor to achieve positive and lasting change in the lives of the people in our community.
We believe the key to creating lasting change – in people’s lives and in our community – is getting to the source of problems. It’s change that doesn’t come easily or by accident. It’s change that requires clear goals. Leads to true partnerships, with differences and special interests set aside so as to make real progress. Involves actions that are deliberate and data driven.
Our goal is to be strategic, collaborative and efficient. We aim to produce tangible results that advance the common good.
It takes everyone in the community – big businesses, small businesses, elected officials, nonprofits, academia, the faith community, the labor movement, the media, parents and neighbors working together to create a brighter future. We call it living united and we invite you to be a part of it.