5 Reasons Affordable Housing Can Drive the Local Economy
Written By AD&V®
ABOUT THE AUTHOR | AD&V® is dedicated to advanced and energy-efficient sustainable architecture & interior design that enhances people’s experience of the world and improves their lives.
AFFORDABLE HOUSING PLAYS A SUBSTANTIAL AND REINFORCING ROLE IN LOCAL ECONOMIC DEVELOPMENT.
With affordable housing, more opportunities become available for people at all income levels, more money is available for investing in the community, and long-term change can begin to take root.
Here’s why affordable housing benefits families and drives the local economy.
1. GENERATES EMPLOYMENT OPPORTUNITIES
Affordable housing developments support job creation and retention. According to the National Association of Home Builders (NAHB), every 100 multi-family units built support 161 jobs in the first year and an additional 44 jobs each subsequent year. In addition, the jobs supported by housing development bring in $11.7 million in local income. Most jobs are in construction, architecture, engineering, property management, maintenance, and retail.
This stimulates the local economy by creating short-term and long-term jobs and attracting employers and employees.
2. PUTS MONEY BACK INTO THE LOCAL COMMUNITY
Rent is the most significant expense for most people and often the most worrisome. But when residents of affordable housing communities can make their monthly rent payments, they have more revenue to spend on local goods and services.
When people spend more on local businesses, it puts money back into their local community through paychecks and taxes, which can support the creation of new businesses and improve local public services—bringing growth and innovation to communities.
3. REDUCES EVICTIONS
Evictions spark a cycle of instability for families, and its ripple effect harms a community’s social and economic well-being. Since rent payments serve as income for landlords, those property owners may have less revenue to draw on for their mortgage payments. That’s why a surge in rental property evictions could have a domino effect on the broader housing market and the economy.
Fortunately, well-designed affordable housing makes it possible for families to have economically stable homes. The Coalition for the Homeless estimates that keeping a family in a home saves taxpayers $38,000 per year in shelter costs. Affordable housing works to prevent evictions no matter the economic climate, and the social and financial return is well worth the investment.
4. IMPROVES INFRASTRUCTURE
Affordable housing development returns money directly to the local economy. With more residents able to pay property taxes, a local government can provide more for its citizens. For example, it has been reported that building 100 affordable rental homes generates $2.2 million in taxes and additional local government revenue from tolls, city fees, etc.
These additional tax dollars can then be re-invested in improved infrastructure and community amenities that benefit everyone, such as street and sidewalk repairs, parks, and playground construction, increased school funding, and other elements that keep city residents healthy and safe.
5. HELPS DECREASE CHILDHOOD POVERTY
Another long-term economic benefit of affordable housing is the possibility of decreasing childhood poverty. A stable, affordable home allows children to establish healthy habits and focus on their goals and education. Equipping kids with tools for social mobility and providing children with a better and more equitable path is a way to build economic growth for communities and healthier societies.
It is estimated that for every dollar spent on reducing childhood poverty, the U.S. would save at least $7 concerning the economic costs of poverty. This has massive impacts on educational achievement and economic output.
DRIVES THE LOCAL ECONOMY
Increasing access to affordable housing pushes economic growth. Each dollar invested in affordable housing boosts local economies by leveraging public and private resources to generate income.
Opportunities for economic development, increased job creation, and retention, reducing the likelihood of evictions, greater tax generation, improved infrastructure, and the ability to address childhood poverty are among the economic benefits of increased access to quality, affordable housing.
The bottom line is that everyone benefits from creating and preserving affordable housing. Promoting affordable housing can drive the local economy and help keep communities vibrant and prosperous.
FURTHER READING: 5 WAYS AFFORDABLE HOUSING CAN IMPROVE LIVES