The National Association of Realtors® (NAR) conference every November provides a bounty of information about the real estate market nationwide. In Boulder, we often think our real estate issues are unique, but at this conference, we find that many communities across the nation are facing the same challenges as we are. A key difficulty is the housing shortage, a common problem across the country in most major metro areas, just as we are experiencing it here in Colorado and Boulder.
This year, I was able to see a presentation by Dr. Lisa Sturtevant, president and founder of Lisa Sturtevant and Associates. Dr. Sturtevant is an expert on the housing shortage issue as she has been involved in research and analysis on local economic, demographic, and housing market conditions and local housing solutions for more than 15 years. She leads housing studies and planning projects for local communities through the country and has worked on housing-related research projects for the National Association of Realtors®.
Since the beginning of the recession in 2007 across the country there have not been enough homes built to meet the demands of population growth. Now 10 years later, the home building industry has not been able to get back to pre-recession production levels.
The first question Dr. Sturtevant addressed was “Why aren’t we building enough housing?”
Her first point is that there is a lack of available land and land prices can be high. In the Boulder area, we are no stranger to this issue. Next, is the sheer cost of materials and labor. The recession saw many skilled trades workers leaving the construction industry, thus creating a labor shortage. Recent natural disasters such as hurricanes and fires have put pressure on the cost of materials. In addition, the fees and municipal processes in most areas have added cost and time. Zoning restrictions limit the construction of smaller homes, forcing prices up due to the size requirements. In some areas, the community is so opposed to new housing, it prevents new construction from moving forward.
Dr. Sturtevant’s presentation to a national audience includes this extensive list of ideas that can help our communities work towards providing more housing at the local level:
-Streamline and reduce inefficiencies in the development review and approval processes.
-Allow diverse housing types.
-Address building standards by reviewing zoning, building, and material requirements and modify them to allow modular and manufactured homes.
-Leverage adaptive reuse by creating opportunities to reposition commercial properties as residential properties.
-Examine and revise impact fees to reflect actual costs of infrastructure service for higher density development.
-Use property tax abatement as a gap financing tool to support more compact and affordable housing communities.
-Expand the construction workforce by cultivating interest and opportunities in the construction trade.
-Make publicly controlled land available to developers of mixed income or affordable housing.
-Establish a priority in capital improvements programs to co-locate housing with new or redeveloped public facilities.
-Work across public agencies to coordinate housing, land use, transportation, schools, and economic development planning.
-Reform land use and zoning to allow for a more diverse set of housing types, including accessory dwelling units and missing middle housing.
-Update condo construction defect laws.
-Promote accessory dwelling unit construction.
-Update and reduce parking requirements in location-efficient areas.
-Work with community banks to increase lending for housing development.
The National Association of REALTORS® (NAR) has done a tremendous amount of research on the housing shortage. Nationwide data is available to the public from NAR on their interactive housing shortage tracker:
The heat map from the tracker (see below) shows the areas with greatest shortages in red. If you go to the tracker, you can hold your cursor over the area you are interested in and it will tell you the number of new jobs in the area compared to the number of building permits being issued.
About Duane Duggan: Duane Duggan has been a Realtor® for RE/MAX of Boulder in Colorado since 1982 and has facilitated over 2,500 transactions over his career, the vast majority from repeat and referred clients. He has been awarded two of the highest honors bestowed by RE/MAX International: the Lifetime Achievement Award and the Circle of Legends Award. Living the life of a Realtor and being immersed in real estate led to the inception of his book, REALTOR® for Life. Also see his video podcasts about real estate topics on RE/MAX of Boulder’s YouTube channel.
For questions, email Duane at DuaneDuggan@BoulderCo.com or call 303-441-5611