According to the Michigan State Housing Development Authority, the state needs to build over 190,000 more apartments. Due to the shortage of supply, housing is becoming more and more expensive. The state is looking for creative solutions to satisfy housing demands in light of the current situation
According to Amy Hovey, executive director of the Michigan State homes Development Authority, “we have people scrounging for housing.”There are several facets to the issue.
According to Hovey, an aging population has resulted in a decline in average household size. According to census statistics, the number of households in Michigan increased from 3.8 million to 4 million over the previous ten years, despite the state’s population growth slowing down.
Hovey also mentioned how holiday rentals were depleting the supply. The National Association of Home Builders estimates that eight states, including Michigan, have half of the nation’s second-home population. Second houses make up more than half of the housing stock in six counties in Michigan.
“The state of Michigan is stunning. Whether or whether their permanent property is in Michigan, many individuals like to own a second home here. Additionally, the number of short-term rentals has increased, which has put pressure on the rental market, according to Hovey.High development expenses that make homes unaffordable for many people exacerbate this.
18% of Michigan households are thought to be “housing burdened,” meaning that their housing expenses exceed 30% of their wages. Last year, mortgage rates reached their highest point in more than 20 years. Additionally, according to Rent.com, the average rent increased by about 14% in a year, which is the second-largest spike in the nation.
Legislators introduced a set of proposals last year that included measures including repealing Michigan’s restriction on rent control in response to steep increases in rent.
Because landlords’ leases are renewable, even those who could previously afford rentals may now raise the rate, according to Hovey. It’s just getting too expensive. Simply said, Michigan’s market isn’t functioning right now.Related: Michigan rent prices, where they are most and least inexpensiveA number of state housing initiatives try to alleviate the situation.
Late last year, the Michigan State Housing Development Authority launched the Housing Readiness Program, which offers towns and localities $50,000 to help them create more housing-friendly zoning and land use regulations
Affordable housing developments will be financed in part by a tax program that was authorized last November. Upgrades to energy-efficient homes might get up to $27 million via the MI Hope initiative. Additionally, immigrants and refugees may afford accommodation thanks to the Newcomer Rental Subsidy.According to Hovey, “We are being more innovative than we have ever been.”
Michigan is filling a vacuum left by the federal government by using these innovative methods. The New York Times stated that despite rising rental and housing expenses, federal housing aid has fallen to its lowest level in 25 years. In the meantime, the US is reportedly lacking 3.2 millionSince Michigan’s “purse strings are much bigger,” according to Hovey, the state is highly dependent on federal housing funds.
The largest source of finance for affordable housing in the nation is the low-income housing tax credit, which is offered by the U.S. Department of Treasury. Public initiatives like Housing Choice Vouchers and Section 8 are funded by the US Department of Housing and Urban Development. Additionally, the state housing agency receives Community Development Block Grants from the federal government.But every year, Congress must authorize this financing
Hovey expressed his frustration, saying, “I am so frustrated that the federal government and the legislature continue to cut housing programs when the entire country is in a housing crisis.”
Increasing the capacity to construct additional homes is one of the Michigan agency’s main objectives going into 2024. Costs are greater than what “Michigan families can afford today,” according to Hovey, which is why the state of affairs is how it is.Building permits in Michigan decreased by 10% between October 2022 and October 2023, as evidence of this.
Hovey expressed his frustration, saying, “I am so frustrated that the federal government and the legislature continue to cut housing programs when the entire country is in a housing crisis.”
Increasing the capacity to construct additional homes is one of the Michigan agency’s main objectives going into 2024. Costs are greater than what “Michigan families can afford today,” according to Hovey, which is why the state of affairs is how it is.
Building permits in Michigan decreased by 10% between October 2022 and October 2023, as evidence of this.
Hovey expressed his frustration, saying, “I am so frustrated that the federal government and the legislature continue to cut housing programs when the entire country is in a housing crisis.”
Increasing the capacity to construct additional homes is one of the Michigan agency’s main objectives going into 2024. Costs are greater than what “Michigan families can afford today,” according to Hovey, which is why the state of affairs is how it is.
Building permits in Michigan decreased by 10% between October 2022 and October 2023, as evidence of this.
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