Lee County Holds Affordable Housing Forum

There’s a large gap between the cost of what’s on the Southwest Florida housing market and what many residents can afford.

That’s hardly new. The question is how to fix it. Officials believe it’s going to take effort by both government and the private sector to narrow the gap.

That was the theme of a wide range of panelists talking about affordable housing Thursday at the Lee County Horizon Council Affordable Housing Symposium, in the region’s latest attempt to find a solution to what is widely being termed an affordable housing crisis.

“Let’s define the problem. Very often I hear people say they don’t exactly understand affordable housing,” said moderator Don Upton. “People don’t know if it’s a long-term problem, a short-term problem, how does is affect the county’s competitiveness in the market, what are the best practices sustainable over time.”

James Nicholas, Professor of Urban and Regional Planning at the University of Florida, pointed to the forces that are causing the market shift. High external demand, much of it from real estate speculators, has created an imbalance between supply and demand and skewed prices upward, putting most homes beyond the reach of local residents.

• Incomes in Lee County grew at an average of 31 percent from 2000 to 2005.
• Housing prices, by comparison, surged upward by a staggering 158 percent.

Another telling stat is that about 113,000 Lee households earn an average of $36,368 annually. Housing is considered affordable if it doesn’t account for more than 30 percent of a family’s income, meaning households with that income could afford to pay a maximum of $122,225 for a home. The median price of a home in Lee County is more than $289,000.

With these prices, buying a house at that price would require a household income of about $89,489, and close to 90 percent of the local households do not earn that much. The recent increase in Florida home loan costs hasn’t helped borrowers on the brink, either.

“The problem here is where is the future labor force going to come from for hospitality, tourism, education and essential services?. If we try to raise wages you are going to need very high wages,” Nicholas said.

The solution could come, in large part, from employers, said consultant Beth Marcus, a former Fannie Mae employee. Helping employees buy houses not only helps the workers, it is also good for their businesses.

“If you are an area hospital, you are going to be interested in employee housing if it helps you retain nurses because you need nurses to continue providing the service you do,” Marcus said.

Employer assistance for housing comes in a variety of forms and can involve buying or renting a home. Options include discounts negotiated between the employer and an outside entity, or outright / matching grants.

Marcus has worked with some companies who have offered employees interest-free loans or matching funds if the person agrees to stay on longer than three years.

“If they leave before that time, they have to pay the loan back. Or the employer can offer to match to a certain level what the employee has saved in three years. But for an employer trying to recruit, those strategies wouldn’t work. They would have to offer something up front,” she said.

Marcus’ presentation ties in with recently passed state legislation, said Jamie Ross, affordable housing director for 1000 Friends of Florida.

“Part of what did pass [in the legislative session] was a measure encouraging employers to have a housing-assistance program as part of a strategy of recruitment and retention,” Ross said.

Southwest Florida isn’t alone. Just look to the eastern coast.

“If you think you have a problem here, I have bad news for you from the other coast,” said James Carras, president of the Broward Housing Partnership, in presenting a case study of his county.
The Broward County housing market lost 22,000 rental units in the last two years to condominium conversions and Hurricane Wilma, giving it the lowest rental vacancy rates in the country. For Broward and other high-growth counties such as Palm Beach and Miami-Dade, the state created a Community Workforce Housing Innovation Program.

The pilot program will provide $50 million to develop housing for essential personnel in communities, which, in theory, will encourage counties to come up with innovative solutions for affordable housing. The program requires long-term affordability of units, both rental and owner-occupied, in return for funding.

“This is the opportunity to bring folks together and get funding to assist in keeping essential personnel here, to encourage local governments to work on regulators barriers that affect affordable housing and to create a non-traditional public-private partnership,” said Nancy Muller, policy director for the Florida Housing Finance Corporation.