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By Iuliia Chepurko

Housing Construction in Alaska: Keeping up with population growth?


ll across Alaska, many communities are faced with severely overcrowded housing markets, making home construction a key recurring issue impacting the state economy. Based on the Alaska Housing Finance Corporation Housing Assessment report, there are significant needs: more than fifteen thousand homes are overcrowded or severely overcrowded, more than seventyfive thousand homes are cost-burdened, and nearly twenty thousand homes use large amounts of energy. Ideally, these homes need to be replaced, but in practice housing construction cannot meet immediate needs. In addition to the current housing shortage, Alaska’s population is growing. Looking at the population by economic region, the Anchorage and Mat-Su Region contains about 54 percent of residents and is by far the most densely populated region in Alaska. About 68 percent of all housing built in 2014 was constructed in this region (based on Alaska Housing Indicators report prepared by the Alaska Housing

Finance Corporation). On average, this region has the highest share of cost-burdened or non-affordable houses, leading about 34.5 percent of households to spend more than 30 percent of total household income paying for a place to live. The Southeast economic region has the second highest number of houses built in 2014 (218 houses or 16 percent) and has the fourth largest population in Alaska. About 27.6 percent of housing does not fit the affordability criteria, and 4 percent is overcrowded. Looking at the last seven years of data available, Southeast Alaska housing construction has a strong correlation with population growth. In other words, the number of houses built keeps pace with the number of people living in the region. Contrary to Southeast Alaska, the Interior region has the second largest population in the state (about 15 percent of the total) but takes fifth place in the number of houses built in 2014 (only 3 percent of the total). In addition, it is one of the regions where housing construction does not fol-

low trends in population changes: there is no connection between population growth and housing construction. Of Interior housing units, 24.6 percent are cost-burdened, which is considered high, and 8.6 percent are overcrowded. At the state level, housing construction mirrors population growth, both of which have upward trends. According to the Housing Assessment report, about one in three households in Alaska are not affordable (31 percent). Of these cost-burdened households, about 3,580 are both overcrowded and cost-burdened. The analysis shows that the housing situation is better in Southeast, as well as the Anchorage and Mat-Su regions, than the rest of the state. Still, addressing the lack of affordable housing is a key challenge statewide. R Alaska Trends, an outline of significant statewide statistics, is provided by the University of Alaska Center for Economic Development.

Sources: 2014 Alaska Housing Assessment by Alaska Housing Finance Corporation, Population Estimates by Alaska Department of Labor and Workforce Development

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Alaska Business Monthly March 2016  
Alaska Business Monthly March 2016  

“Forever Alaskan” Carol Gore, president and CEO of Cook Inlet Housing Authority, is a quintessential leader in creating affordable housing f...