There are too few housing units to meet the current and projected housing needs in Anchorage. This is a real problem for victims of domestic violence, for working families, for job seekers, and kids returning from college. Rasmuson Foundation is embarking on a collaboration, Housing Anchorage, to find broad-based community solutions to improve the viability of housing options for Anchorage's workforce and spur economic growth.
Readers of the Anchorage Daily News may have noticed a recent uptick in reporting about the lack of affordable housing options in our state’s largest city. This is a welcome development because the simple fact is there are too few housing units to meet the current and projected housing needs for our city’s population. More people than available housing units results in price inflation, lower quality of life, stymied economic growth, and more.
This is a real problem for victims of domestic violence who cannot find a place to stay when they are ready to leave a shelter, for working families who are prepared to leave subsidized housing but have no decent housing options, for job seekers who chose not to move to Alaska, and kids returning from college to Alaska and finding there are no reasonable places for them to stay.
Rasmuson Foundation has embarked on a collaboration with city, state, private developers, and nonprofits to identify ways to make a difference and free up the housing construction gridlock. Housing Anchorage seeks to find broad-based community solutions to improve the viability of housing options for Anchorage’s workforce and to spur economic growth. The collaboration is made up of Alaska Housing Finance Corporation, Anchorage Community Development Authority, Cook Inlet Housing Authority, Rasmuson Foundation and United Way of Anchorage. We work in partnership with Anchorage Economic Development Corporation’s Live.Work.Play. initiative.
The Foundation is committed to a long-term process that will require a commitment of time and resources over a number of years. Ultimately the Foundation may consider a major catalytic investment that leverages significant dollars to spur production of quality, affordable housing. However, the groundwork of building political will and a shared sense of urgency among policymakers is required. And that’s where we are today.
Here are goals identified by Housing Anchorage:
Production: Build 18,000 new units by 2030
- In the last six years, the Anchorage Bowl has produced fewer than 350 new housing units annually. At this rate, Anchorage will have only 40 percent of the units needed by 2030.
- A healthy rental vacancy rate is five percent. Anchorage’s vacancy rates has been far below five percent for the past six years.
- We’re not building enough of any type of housing, but the greatest need is for multi-family housing. At the current production rate, multi-family housing units will only meet 20 percent of the forecasted need.
- Only five local builders have built more than 100 housing units total in the last six years. Most of the homes they built were pre-sold units.
- Builders and developers face a 25 to 50 percent gap in what it costs to develop multi-family housing compared to what the majority of Anchorage renters can afford to pay.
Affordability: Decrease number of people paying more than 30 percent of their income on housing
- Median rent for a two-bedroom apartment is $1,300 per month. To afford that, a household must earn $50,000 a year.
- The average-priced single-family home is $347,000. To afford that, a household must earn $85,000 per year.
- Between 2008-2012, median household income for Anchorage renters increased 4.7 percent. In that same time period, the median cost for an Anchorage rental increase by 13.7 percent.
- One-half of Anchorage renters spends 30 percent of their income on housing. One in five spends 50 percent. This means many families may not have enough money for food, childcare, transportation, utilities or other purchases that help grow the economy.
- Workers in 21 of the 25 most common jobs in Anchorage cannot afford a two-bedroom apartment. Workers in 18 of these jobs cannot afford a one-bedroom apartment.
Economics: Improve business’ view of recruitment and retention in next five years
- Fifty-eight percent of businesses polled said the price and quality of Anchorage’s housing affected their ability to recruit or retain employees.
- Ninety-two percent of Anchorage residents polled feel that an adequate supply of quality housing options is good for the economy.
- Much of Anchorage’s rental housing stock is old and needs to be upgraded or replaced. Twenty-two percent of the housing stock was build before 1970, making it at least 45 years old.
- In February 2014, only 458 homes were listed for sale in Anchorage by the Multiple Listing Service. This is the lowest inventory in the last 30 years.
Areas of focus for Housing Anchorage include policy, zoning, regulations, permitting, infrastructure, and financing tools (private, public, and public-private partnership). This suite of possible remedies may well have applicability statewide. The housing shortage is even more acute in many of our state’s smaller communities where we also hope to make a difference for the better. We expect a rigorous debate about these issues and invite you to bring your ideas to the table and to get involved.