United Way launches effort to address housing shortage
New construction in the Clearwater Creek development off Muldoon and DeBarr is seen in April, where approximately a dozen zero lot line homes are being built. Anchorage is only adding about 300 new homes per year despite projections that show the city needs about 900 per year to keep pace with population growth.
File Photo/Michael Dinneen/AJOC
United Way Anchorage is spearheading a collaborative effort to attack Anchorage’s housing woes.
The nonprofit, traditionally known as a charitable organization, is conducting surveys of Anchorage employers and workers to identify what the city’s residents want to live in and how the currently compressed market is impacting local businesses.
“We want to get a real flavor of what people want, what they can afford and what they’re willing to pay for so we can then start figuring out what are the sweetest strategies that will spur production of those kind of units,” United Way Anchorage President and CEO Michele Brown said.
The surveys will be dispersed to Anchorage’s largest employers during the end of July and early August, Brown said. They will also be available at a number of locations around town and through an email distribution.
Aside from the questions determining business type and size and employee demographics that can be expected in most surveys, the employer questionnaire asks business leaders whether or not they offer relocation packages for new hires coming to Alaska. It also inquires about where the majority of their employees live — in Anchorage, the surrounding communities or farther away in the Palmer-Wasilla area.
The employer survey asks respondents what they have heard from their employees regarding the housing market in Anchorage, whether or not it has impacted their ability to hire and how much they have to pay their workers.
Employees are asked about their type of home, how much of their income is spent on housing, their reason for living in Anchorage and whether or not their housing situation could affect whether or not they stay in the city.
Brown said the idea for the joint surveys spawned from early discussions within Housing Anchorage, a newly formed coalition of government and nonprofit groups that are pooling resources to maximize their collective impact.
When the information from the surveys is compiled, the group will have a better idea of what the city needs to solve the problem, she said, and some of the anecdotal static will be removed.
“There are folks who think everyone wants a (single-family) Hillside-type environment and then there are a lot of young professionals who say, ‘You know what, I want to live downtown; we want multi-family housing downtown where we can walk to everything,” Brown said.
Formed from a series of focus groups last winter, Housing Anchorage is made up of leaders from the Anchorage Community Development Authority, the Alaska Housing Finance Corp., Cook Inlet Housing Authority, the Rasmuson Foundation and United Way Anchorage.
Early work in the housing vein started by trying to address homelessness in Anchorage, Brown said. It was quickly realized that the low-income units needed to support those trying to get off the streets were not becoming available like they should.
“We called it housing gridlock because no one was doing the normal things that we’ve become used to as a society — you start at a low rent and you build your way up until you become a senior and then you start downsizing,” she said. “People were not able to move up to the next level so they were not freeing up units.”
It no longer takes a long or arduous study of Anchorage’s housing market to identify the root of the problem. There simply are not enough units — large houses, small apartments or otherwise — to satisfy demand.
A 2012 study conducted by the Municipality of Anchorage found the city will likely need 18,000 net new units by 2030 to keep up with population growth. That equates to about 900 new homes per year. The city is adding currently adding between 300 and 350 new homes per year, only about a third of projected demand, Brown said.
Achieving the level of new home production stated in the municipal study is Housing Anchorage’s first goal, she said. AHFC’s annual rental market report for 2013 found rental vacancy in Anchorage increased last year, but only to 3.3 percent. A healthy vacancy rate is often considered to be in the 5 percent range.
The squeeze is not limited to renters.
“In Anchorage we have both a production problem and an affordability problem,” Brown said.
Housing Anchorage found that 458 homes were listed by the Multiple Listing Service, an industry-wide real estate tracker, in February 2014, the lowest level of available inventory in 30 years.
Tied to the home production goal are goals of decreasing the number of households “burdened” by housing costs and improving business recruitment and retention in Anchorage within five years.
According to data compiled by the Housing Anchorage group, half of the city’s renters spend more than 30 percent of their income on housing and nearly a quarter spend 50 percent of their earnings on rent. To employers concerns, 58 percent say the price and quality of Anchorage’s housing has hurt their ability to hire and retain qualified employees.
Jonathan King, a senior economist with Northern Economics Inc. in Anchorage, said the research firm doesn’t have to look beyond its own staff to see the impact a stressed housing market is having on Anchorage’s economy.
During Northern Economics’ last round of hiring, a candidate was selected from Outside, but when she found out the cost of housing in Anchorage was twice the cost of where she was from she got “sticker shock” and demanded a salary the company could not afford to pay, he said. The position went unfilled, according to King.
The cost of housing can overshadow other aspects of Anchorage such as its quality of life, the lack of sales taxes, its food scene and the outdoor opportunities not usually found in a city its size, King said.
“It makes it hard because you’ve got this great community; you want to sell the community as a great place to live and the very first thing people want to talk about is housing and it’s not a net positive right now,” he said. “It’s very hard to sell Anchorage on housing. As a recruiter you almost want to focus on everything but housing.”
From 2000 to 2012, average wages in Anchorage kept pace with the general cost of living, King said, with both increasing about 36 percent to 37 percent. However, over that same time, the median price of a single family home ballooned 80 percent from about $180,00 to $340,000.
Northern Economics has had to adjust its payroll economics to compensate.
“With our junior staff we are looking at the cost of housing in Anchorage and we are more aggressive moving up their wages as they progress just so that they can be in housing,” King said.
According to Brown, Housing Anchorage hopes that by gathering the key players and focusing their resources, a solution to the complex problem can be pinned down.
“We were looking at how we had addressed these issues in the past and realized that we’d been addressing them by — a project here, a project there, but there was no overall plan to really figure out how to unite our various and disparate efforts around a cohesive strategy that gets us 18,000 new units by 2030,” she said. “We aren’t going to piecemeal our way to that.”