(Source: MIRS.news, Published 05/30/23) (MACKINAC ISLAND) – The first panel at the Detroit Regional Chamber Mackinac Policy Conference was a plea to businesses from the Michigan State Housing Development Authority (MSHDA) regarding the need for housing in the state.
MSHDA Director Amy Hovey told a packed room at the Grand Hotel on Mackinac Island that the state is 190,000 housing units short, the housing size has shrunk from four people to two, there has been an uptick in the purchase of second homes, short-term rental purchases and more than 50% of the state housing stock is 50 years or older.
“Typically, affordable housing issues get a negative connotation that it is for people who don’t work or people not working enough. No, this is hitting everyone in our community,” Hovey said.
She said the cost of buying a home has gone up about 84% over the past decade, but over the same period, the cost of income has only risen 25%.
When it comes to building a house, she said the average cost is $375,000 and only one out of four Michiganders can afford it.
Jared Fleisher, Rocket Companies vice president of government affairs and economic development, said the answer was subsides.
“Grab somebody here at the MPC, a legislator, state senator, a governor, and say, ‘priority number one for this budget, you got to get your budget invested in housing,” Fleisher said.
He said the state needs to put a minimum of $50 million in non-earmarked funding “for a few years” into community development and just into housing production.
He said the “Missing Middle” program needed to have another $50 million added to the $50 million approved. MSHDA recently expanded the parameters of the program to include all developers, not just non-profits.
Donald Rencher, the housing, planning, and development group executive for Detroit, said those subsidies needed to be directed toward the creation and rehabilitation of single-family homes.
“A lot of our federal programs are geared toward multifamily housing tax credit project processes, and it has been difficult to do a lot of single-family homes,” Rencher said.
He said one of the first things businesses ask him about Detroit is what was being done about housing.
He said Detroit has been working to not just develop new single-family homes, but fix the existing ones.
“If the Mayor was here, he would tell you about the Detroit Land Bank and the success that they have been able to sell homes on the market to private individuals and they’re fixing them up,” Rencher said.
Renovare Development Managing Partner Shannon Morgan said there have been difficulties in the development of rural areas, because many of them don’t have a long-term management plan or infrastructure.
“A lot of them you have to build out the basic utilities and roads to get the housing development, which we all know increases the cost,” Morgan said.
She said most of those rural communities need help to manage the development process.
Cherry Republic President Bob Sutherland said he had been warning about a housing shortage in northwest Michigan for the past 20 years.
He told a story about a development that was built near Traverse City and of the 56 lots that were developed, only seven of those went to actual families.
“All the rest went to second-home owners, AirBnBs, and retirees,” Sutherland said.
He said there have been incentives that businesses have been offering to help get people into housing, such as offering a free one-year payment to hospital workers and nurses to get them to move to the area.
He said Cherry Republic has been working with the counties in northwest Michigan as well to help incentivize people to move into houses.
“I’ve been dealing with this housing issue for over 25 years and I don’t think we’ve ever been in a better position to make things happen,” Sutherland said.
