Panel: Affordable housing is critical to economic development

A multifamily housing development under construction west of downtown Boise.
A multifamily housing development under construction west of downtown Boise. Economist Elliot Eisenberg, a panelist at the Conference on Housing and Economic Development in Boise March 5, said housing prices are rising because supply isn’t meeting demand. Photo by Anne Wallace Allen.

Much-needed workers are turning down jobs in Burley because they can’t find affordable housing nearby, says Jan Rogers, chief executive officer for Regional Economic Development for Eastern Idaho.

Rogers spoke at the Idaho Housing and Finance Association’s Conference on Housing and Economic Development in Boise on March 5.

“When does housing become part of the strategy of economic development?” asked Rogers. “It needs to be.

The lack of affordable workforce housing “snuck up on us,” she said.

The problem of affordable housing is a national one. Housing prices are going up nationwide, not due to a bubble but due to simple supply and demand, said Elliott Eisenberg, an economist who also spoke at the conference.

Eisenberg said builders can’t make houses fast enough and cheaply enough because of the costs of regulation, land, and building material. Moreover, there aren’t enough skilled workers, and homebuilding hasn’t seen any improvements in productivity since 1947, he said.

Jan Rogers
Jan Rogers

Meanwhile, people are moving into Idaho at an unprecedented rate. Boise Mayor Dave Bieter said he expects to see 50,000 new Boiseans in the next 20 years. That means 20,000 new homes, or 1,000 new housing units a year, he noted. And that’s required some hard decisions on the part of the Boise City Council, in the face of pushback from Ada County residents who found a city growing up around them.

Bieter’s had to tell residents of Northwest Boise, for example — just two miles from downtown — that they don’t live in the country anymore. “The only thing people hate more than sprawl is density,” he joked, noting that Boise now has an average of almost seven units per acre.

Moreover, Idaho can’t count on the federal government to help, Bieter said. In 1975, Boise got $5 million per year to help build housing — the equivalent of $23 million today. Now, however, Boise gets just $1.2 million a year, he said.

Isaac Chavez
Isaac Chavez

Investing in affordable housing also means investing in the city amenities that go with them, especially when they move from other cities, said Isaac Chavez, chief executive officer for the Idaho Realtors.”They are going to demand them,” he said of amenities such as bike lanes. “We need to balance NIMBY [not in my back yard] with the needs of the new residents.”

Idaho has 71.1 percent home ownership, compared with 63.7 percent nationwide, said Chavez. However, the percentage is lower among African-Americans — 41 percent — and Hispanics, the fastest-growing group in Idaho — 47.7 percent, he said. Part of the problem is coming up with the down payment, he said. To help deal with that aspect, the Idaho Realtors plan to bring a bill to the next legislative session to help people build a savings account for a down payment tax-free, he said, describing it as a 529 plan for a down payment.

With developments such as design review, Boise is starting to figure out a better way to build dense affordable housing than the “skinny, crappy houses” of a few years ago, Bieter said, such as partnering with private enterprise and philanthropy organizations.

“It’s going to take a barn-raising, but there is reason for optimism with government and philanthropy working together,” Bieter said.