More than half of developers of apartment housing are willing to provide affordable housing in their projects but there are a number of moves by government they think would make it easier and more economically feasible, according to a new report.
“Housing Affordability Toolkit“, a report produced by the Florida Apartment Association and the Apartment Association of Greater Orlando, lays out the challenges of Florida’s housing crisis from the perspective of apartment builders, and what they think needs to be done to prepare for an anticipated even larger surge in Floridians in need of housing in coming years.
The report is based on a survey of market rate and affordable apartment developers.
In part, it’s a legislative wishlist from them, aimed both at the Florida Legislature and local county and municipal governments.
And tops on the list of problems they say they face in providing more affordable housing is not available incentives, capital, taxes and fees, nor building regulation, though all of those are addressed as problems the associations would like addressed.
Instead it’s the ages-old tug-of-war between people already living there, the prospect for apartments: the Not-In-My-Back-Yard phenomenon, the report concludes.
Beyond that, the report concludes that the top incentives to drive development would be reduced or eliminated impact fees, non-ad valorem property tax discounts, and density bonuses.
“Municipalities all across the state are facing unprecedented housing affordability challenges and the apartment industry is taking a proactive role to be part of the solution,” Amanda Gill, government affairs director for the Florida Apartment Association, stated in a news release accompanying the report. “We created the Housing Affordability Toolkit, which presents research-based solutions to assist local governments in stimulating the development of affordable housing.”
The report cites research by WeAreApartments.org, a group in partnership with the National Multifamily Housing Council and the National Apartment Association, to project that, with Florida’s population growth and housing trends, Florida will need an additional 669,391 apartment homes by the year 2030. That amounts to roughly an average of 47,814 new units each year, yet Florida is averaging adding only about 35,000 units a year in recent years, the report states.
“At this time, roughly 35 percent of Floridians rent their homes, but this number is expected to rise as the trend of homeownership continues to decrease across the state,” the report states.
Only about 30 percent of the current apartment projects include some “affordable housing” units, the report indicates.
About 56 percent of the developers surveyed expressed some level of interest in developing affordable housing, “if the appropriate incentives were provided by a local government.”
A critical component of any development is financial viability, Bonnie Smetzer, president of the Florida Apartment Association and partner and executive vice president with JMG Realty Inc., stated in the news release.
“All developers want to build and have the properties filled,” Smetzer said. “But they’re not building affordable housing because they can’t get the financing and equity.” Local governments can partner with developers by offering the right incentives to overcome the financial challenges and fill gaps in the rental housing market, she added.