THE PANDEMIC THREATENS THE ALREADY VULNERABLE AFFORDABLE HOUSING CRISIS
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he current housing market is already facing low inventories, whose persistence poses a possible threat to affordable housing efforts since demand is increasingly growing. On top of that, the ongoing pandemic doesn’t seem like it will stop any time soon. This is a perfect storm that could exacerbate the already vulnerable affordable housing crisis. Even before the pandemic, the housing supply was already a cause for concern. The GAP report published by the National Low Income Housing Coalition in late last year revealed that there was a shortage of seven million affordable homes for low-income households at or below the poverty guidelines, or 3% of the area median income. The ongoing pandemic is further pressuring these issues. Jay Parsons, vice president of multifamily optimization and deputy chief economist at RealPage, a property management software company, predicts that the total apartment supply will remain high through 2021 due to the pipeline of projects that were approved and underway during the pre-pandemic period. Parsons also cautions that the pipeline of projects is thinning out, and there could be a massive drop-off of completions by 2022. “COVID and the economic uncertainty from it have made it more challenging to get new development deals done,” Parsons stated. “Affordable housing is an even bigger challenge. There is woefully insufficient government support for building and maintaining affordable housing nationally. Developers can’t build affordable housing without government support. And the local, state and federal governments all seem to support affordable housing more in theory than in reality.”
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THE POWER IS NOW MAGAZINE | OCTOBER 2020
