Every election year, you likely hear some consistent topics come up. In federal elections, many candidates discuss national debt and budget issues. In local proceedings, people complain about the state of roads.
However, one issue that cuts across all three levels of government relates to workforce housing. What is workforce housing, you ask?
Workforce housing serves families sitting between affordable housing and luxury housing. Generally, they house families that earn between 80% and 120% of the median income. This exact amount varies depending on one’s county and state.
Many people are unfamiliar with what qualifies as workforce housing and its benefits for families. If you’re one of those people, that’s okay! Find the three essential workforce housing facts you need in our guide below.
1. Distinguishing Workforce Housing From Affordable Housing
People often confuse the terms “affordable housing” and “workforce housing.” When people use the first term at the popular level, they frequently mean workforce housing. So, what is the difference between the two in practice?
Affordable housing’s industry standard-definition refers to any housing that serves families at or below 60% of the median income. Usually, local municipalities and government programs classify affordable housing as homes for those making between 0-60% of the median income.
In contrast, workforce housing serves families earning between 61% or higher of the median income. These families do not rely on government-subsidized rents for their living.
2. Rent Prices Are Rising
People have two options when trying to find housing in their budget. They either rent a home, or they purchase one.
For various reasons, people often choose to rent. This trend is especially true in cities.
When you rent a home, you pay the property owner to live on their land. This rent fee pays for their real estate investment.
In the last fifteen years, two things happened that caused property owners to raise rent prices. The first was in the Great Recession of 2008. Like many others, landlords needed more money to make ends meet.
The second, as you likely know, is the COVID-19 lockdowns. As businesses shut down or restricted their operations, people lost their wages. As a result, they could no longer afford their housing.
To meet this challenge, landlords raised often raised the rent. The reason for this was that families who could afford the higher rent likely had more job security.
3. Workforce Housing Is More Stable
A longstanding workforce housing fact is that it’s a more stable sector than affordable or luxury housing. Often, workforce families have more sturdy work situations than those in affordable housing. As such, they can continue to pay their rent or mortgage payments.
On the other hand, they also remain more stable than luxury homes. When economic downturns come, many people decide to downsize. This makes the luxury housing market volatile while workforce housing remains more consistent.
Learn More About Workforce Housing
Workforce housing provides excellent opportunities for families on a fixed income. It offers the median between luxury homes and affordable housing.
Learning more about workforce housing can help you make vital decisions about your living situation. So, check out some of our other workforce housing tips today!