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ADDRESSING THE IMPACT OF HOUSING AFFORDABILITY FOR VIRGINIA’S

ECONOMY

Virginia Coalition of Housing and Economic Development Researchers

GEORGE MASON UNIVERSITYVIRGINIA COMMONWEALTH UNIVERSITY

VIRGINIA TECHWILLIAM AND MARY

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Component 1: Economic Impact Analysis

• “Show how the industry’s strength or weakness affects state and regional economic vitality”

• Assess the impacts of the VA housing industry– Single family & multifamily– New construction and repair/remodeling

• Materials, professional services (architects, engineers)

– RE services (brokers, agents property mgmt, legal)– Financial (may not be able to separate HELOC in initial analysis)

• Broad comparisons with other key industries

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Supply & Demand

Community Vitality

Component 2: Housing & Economic Development Linkages

Unpacking Housing and Affordability: Housing is a key part of the

economic infrastructure. It is intertwined with other key

economic components!Household Well-being

Economic Investment

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Housing & Economic Investment• Households consider the cost of the entire

“housing package” along with other costs of living when they choose where to live.

• If costs outweigh the benefits (from wages, social capital, amenities and opportunities) in any region, investment and re-investment can change.

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Housing Supply & Affordability• The appropriateness of housing and its affordability

impact economic investment and household well-being.– Comprehensive costs of the complete “housing package”:

• Direct housing costs i.e. utilities and rent • Transportation (time and money)• Trade-offs (what households give up) to have housing• Consequences of inadequate housing might result from:

– high cost areas – rural vs. urban differences– built-out areas and revitalization needs and/or aging stock

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Housing & Household Well-being• When the costs of the “housing package” far

outweigh the benefits households can become “trapped”– With no opportunity for growth– With generational consequences– In a physically unhealthy environment– In a mentally unhealthy state

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Housing & Community Vitality• When the benefits of the “housing package”

outweigh the cost Investment in neighborhoods, towns and cities increasesEconomic vitality and competitiveness

• When the costs of the “housing package” far outweigh the benefits in a particular localityLack of Re-investmentDisinvestment

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Connecting Housing & Economics• Direct Housing Costs & Benefits– Production Costs & Efficiencies– Housing Supply & Demand– Household Costs:• Operations/utilities• Transportation & location• Health consequences and benefits• Access to education (or lack thereof)

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Process• Review of others’ efforts to examine the same question• Data compilation and management- (coding and

merging comprehensive data for spatial representation)• Data analysis (modeling, spatial, etc.)• Stakeholder engagement• Synthesize and assess the impacts of the entire

“housing package”

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Universities and Approach• Housing

GEORGE MASON UNIVERSITY VIRGINIA COMMONWEALTH

UNIVERSITY VIRGINIA TECH

• Spatial Analysis VIRGINIA COMMONWEALTH UNIVERSITY

• Economics GEORGE MASON UNIVERSITY VIRGINIA COMMONWEALTH

UNIVERSITY VIRGINIA TECH WILLIAM AND MARY

• Transportation VIRGINIA TECH (LEAD) GEORGE MASON UNIVERSITY

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Packaging the Research• At a minimum, we will integrate all of the analysis and

findings into one clear story from beginning to end.• Identify major themes (for example):– Economic Opportunity– Economic Development– Community Vitality

• Work with Commonwealth, VHDA and DHCD to determine most useful methods for reporting.