Most communities consider their most important assets high-quality schools, proximity to jobs, access to parks and nearby retail for necessities. Few consider affordable housing as a benefit to the community. Instead the focus in on the cost to taxpayers, not the fiscal and economic benefits acquired when communities encourage the development of affordable housing.
Improves Employment Attraction and Retention
Employers have difficulty attracting qualified employees when there is a lack of affordable housing nearby. Therefore, it cost more to recruit and retain employees. In a national survey, 55% of companies with 100-plus employees reported a lack of affordable housing near their location and 67% believe that it is having a negative impact on retaining qualified employees.
Increases Residual Income
Affordable rent and mortgage payments increases discretionary income, allowing families to buy food, clothing, health insurance or pay down debt or amass savings for education or other major expenditures. Local businesses gain more customers which generates more revenue.
Impact on Neighborhood
The Center for Housing Policy’s short report, Don’t Put it Here!, looked at the impact of affordable housing on nearby property values. Little evidence was found that affordable housing negatively affected the value of neighboring properties. They identified several key factors that appeared to have the greatest influence over impacts on the surrounding neighborhood:
- Well-maintained and managed affordable housing was more likely to have a positive or neutral impact.
- Attractive buildings that blended in with the surrounding neighborhood had a positive or neutral impact on the values of nearby properties.
- Well-designed and located affordable housing was unlikely to negatively impact property values in strong neighborhoods.
Reduces Foreclosure Risks
Recent research suggests that low- and moderate-income households who participate in affordable home ownership programs have a more reduced risk of delinquency and foreclosure than similar buyers with prime or subprime loans. Reducing foreclosures not only helps stabilize neighborhoods, but also results in meaningful savings for local governments that might have to absorb costs related to property maintenance, court and legal expenses, increased police and social services for the affected neighborhoods, and, in some cases, demolition of abandoned houses (source). Abandoned homes can decrease the property taxes, utility revenues, and other taxes and fees that local governments collect. It is also well documented that vacancies can reduce the value of nearby homes, further reducing property tax revenues (source).