Michigan faces affordable housing shortage

By GLORIA NZEKA
Capital News Service

LANSING — Michigan has a shortage of rental homes that are affordable and available to extremely low-income households, according to the National Low-Income Housing Coalition.

Its study found that 71 percent of extremely low-income renter households in the state spend more than half of their income on housing costs and utilities.

We’re seeing more and more people who maybe precariously housed, being at greater risk of becoming homeless,” said Eric Hufnagel, the executive director of the Michigan Coalition Against Homelessness, a nonprofit organization of emergency shelters and transitional housing programs.

Hufnagel said the cost of housing is going up, and it’s getting more difficult to afford or keep housing.

“The housing market is tougher. Fewer units and higher costs are pushing more and more people to the point where they may become homeless,” Hufnagel said. And when people live from paycheck to paycheck, any economic downturn can put them at risk of losing their housing.

The national coalition’s 2018 report shows that households whose incomes are at or below the poverty line spend more than half of their income on housing. Its recent report said poor households are more likely than other renters to sacrifice necessities like healthy food and health care to pay the rent and to experience “unstable housing” situations like evictions.

The national study found that, on average, a Michigan household must earn $16.24 per hour (working 40 hours a week, 52 weeks a year) or have a $33,775 annual household income to afford a two-bedroom rental home without paying more than their income.

In some communities, not everyone working 40 hours a week can afford housing.

For example, Cynthia Arneson, the executive director of a Ludington-based shelter called Youth Staircase Services said, “So there are people who have jobs, and even if they are working 40 hours a week they cannot necessarily afford to live in the housing that is available in our counties.

The organization serves Lake, Manistee, Mason, Missaukee, Wexford and Oceana counties.

The National Low-Income Housing Coalition says the housing crisis “isn’t just about affordability—it’s about economic mobility, too.”

Adam Sheren, a real estate agent with the Adley Group Realty & Development in Ludington, said housing in West Michigan is a concern, and the major difficulty is that it’s tough to lure major housing developers to the city.

“It’s very hard for a community such as Ludington to attract big-time developers because they don’t see the dollars,” Sheren said. “For them to come and do a project here, there has to be a ton of incentive.”

In Michigan, Sheren said rent for a two-bedroom apartment in rural communities ranges between $600-$850 a month, and in the city prices can go up to $2,000.

Jana Cooper, from Third Coast Development, a Grand Rapids-based commercial real estate firm, said the company has two affordable housing projects under construction in Grand Rapids. One is set to open in August 2018.

The apartment complex will feature 165 one- and two-bedroom units priced to be affordable to households of mixed income levels.

Sheren said it’s hard for many local developers to break into the development game even though they have the skills and the desire to do so. Because they don’t have experience, they aren’t always aware of available grants and financing opportunities.

In Mason County, Sheren said initiatives such the Growth Alliance and the Vacant Property Campaign have done a good job of understanding the need for local developers.

Those initiatives, brought in by local groups, conduct marketing campaigns to show local developers the opportunities around the area and help them meet with local stakeholders.

“Municipalities should assist developers in finding properties, development opportunities, grants or whatever it may be so that they can address these affordable housing issues,” Sheren said.

Instead of trying to attract developers from Grand Rapids or out of state, Sheren said the key to solving the housing problem is working with people already in the community who have a vested interest in seeing that community flourish.

“Provide them with a team and tools and incentives — whether it’s tax reductions, a grant or being a voice between them and organizations like the Michigan Economic Development Corp. — so somebody in the local community can get a project done,” he said.