Last month, Bleakly Advisory President Geoff Koski presented on the challenges of housing affordability in the Atlanta region at the Atlanta Regional Housing Forum. Based on research Bleakly Advisory Group conducted on behalf of the Urban Land Institute, Geoff laid out three major factors that led to the current housing crisis.
1) Job growth in the Atlanta region outpaced housing growth by more than 3:1 annually during the past three years. Beginning in 2014, the Atlanta region began adding significantly more jobs than housing units, 75,000 jobs compared to 20,000 housing units on average annually. "One of our competitive advantages, as a region, was its affordability... That's why Atlanta was able to win," Geoff said. "But we risk losing all of that," if the region loses affordable housing where people want to live.
2) The little housing stock that has been built in recent years, particularly multi-family housing, has almost entirely consisted of luxury housing, out of the range of what most living in the region consider affordable. "The lack of supply and growing demand... Prices go up, it's just that simple," Geoff stated. Bleakly Advisory figured this by looking at the costs needed for a household earning 80% of the average median household income (AMI) that spend more than 30% of household income on housing costs/rent.
3) Restrictive regulations and zoning across the region limit the types and quantities of housing units developers can build, driving the housing shortage. "We have restrictive zoning and development policies that make it difficult to develop in the City of Atlanta and elsewhere," Geoff explained. "We don't have the right development policies. They are hurting us." This limit increases housing costs, sending middle- and lower-income households to the margins of the region to find affordable housing. Geoff calls this the "drive till you qualify" dilemma for residents; people will find affordable housing on the outskirts of the region only to have housing savings offset by driving costs and time.
The Atlanta Regional Housing Forum that Geoff spoke at on June 6th was covered by multiple articles on the Saporta Report by Max Blau and David Pendered. To read Geoff's full presentation, click here.