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State Housing Needs 1. Housing Needs and Community Economic Vitality are Intertwined Economic conditions drive housing need and demand. Unaddressed housing.

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Presentation on theme: "State Housing Needs 1. Housing Needs and Community Economic Vitality are Intertwined Economic conditions drive housing need and demand. Unaddressed housing."— Presentation transcript:

1 State Housing Needs 1

2 Housing Needs and Community Economic Vitality are Intertwined Economic conditions drive housing need and demand. Unaddressed housing needs stifle economic growth and impede community economic revitalization. A strong economy supports investment in quality, affordable housing. Weak housing investment depresses employment, consumer spending and overall economic activity. 2

3 Needs Vary Across Regions Regional demographic and economic growth remain highly divergent. Differences in demographics have become entrenched and are difficult to change. Growth and decline each bring their respective needs and challenges. 3

4 Economic and Demographic Disparities Are Entrenched Demographic disparities are great and extremely difficult to change. Macro-economic drivers impact regions differently. Despite long-term efforts, regional demographic and economic growth remain highly divergent. Each region has it own needs and challenges. 4

5 The Aging of the Population Accentuates Long-term Differences The younger generation is increasingly concentrated in the major metro areas. Younger populations support continued household, labor force and economic growth. Southern and western regions have rapidly aging populations and slow or declining labor forces. This makes growth more difficult to sustain. 5

6 NoVA’s Increasing Share of Growth is Now Driven by Natural Increase A majority of Virginia’s growth continues to be concentrated in Virginia’s “Northern Tier.” Its economic strength has attracted young households who sustain healthy natural increase. The region has 38% of the state’s population. However, since 2010, has had 61% of growth including two-thirds (67%) of natural increase. 6

7 Greater Richmond and Hampton Roads Likewise Attract the Young Richmond and Hampton Roads significantly lag Northern Virginia, yet maintain natural increase. Richmond’s healthy growth is driven by balanced natural increase and net migration. The Navy sustains Hampton Roads’ younger population—natural increase continues to offset weak net migration. 7

8 Southern and Western Regions Face a Substantial Demographic Undertow Half of Virginia’s counties and cities—mainly in southern and western regions—now have negative natural increase. They must increase their ability to retain and attract younger households in order to sustain their labor force and economic growth. 8

9 Absent Natural Increase, Growth Depends on Generating In-Migration 9

10 Diversity Varies Greatly by Age, Which Magnifies Historic Regional Differences 10

11 Policy Must Reflect Differences In faster growing regions, new housing production must be adequate in price and location to accommodate all income and age groups—especially the needs of young workers and minorities. In regions and local communities with slow/limited growth, the quality of the housing stock must be maintained/improved in order to sustain community vitality and economic competitiveness. 11

12 Key Issues in Growing Regions Locational mismatch between affordable housing and employment centers impacts transportation systems Current housing challenges of Millennials will grow as they age into marriage and family formation Concentration of assisted housing in older communities limits access to suburban employment for lower income and minority households, and challenges increasingly suburban seniors. 12

13 Key Issues in Slow Growth Areas Sustaining adequate investment to ensure the quality and competitiveness of the housing stock In particular, maintaining the right balance between new construction and preservation – Where growth of aggregate demand is low, new construction may contribute to high vacancies and disinvestment in other portions of the inventory – But, inadequate new construction contributes to obsolescence and difficulty in meeting shifting household needs and demands 13

14 Extremely Low-Income (ELI) Needs Unmet need for affordable housing by people with extremely low-incomes is growing rapidly driven by:  Community integration of people with disabilities  Efforts to eliminate homelessness  Community re-integration of ex-offenders  Financial impact of Great Recession Federal funding for rent subsidies has significantly lagged the need for several decades—now appropriations mainly aim to sustain the current number of recipients 14

15 Costs of the Unmet ELI Needs High direct state and local costs of unmet ELI needs: – Homeless persons require significant support services – Institutional alternatives for vulnerable populations are more costly than community alternatives – Federal judicial mandates require action to be taken Significant indirect economic impacts: – Reduced labor force participation – Weak educational performance 15

16 Summary of Policy Challenges Allocating scarce housing resources to address both the needs of ELI populations and Virginia’s future work force Balancing investment in new construction and housing preservation Expanding affordable housing options in growing suburban markets and high-cost areas Sustaining the vitality and economic competitiveness of slow-growing, aging communities 16

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