Commercial Investment Real Estate Spring 2020 | Page 23

By Sarah Hoban
WORK IN
PROGRESS
Market challenges limit the supply of
workforce housing, but zoning, construction
innovation, and changing preferences could
provide much-needed boosts.
I
CIREMAGAZINE.COM
n traditional real estate parlance, housing for middle-market customers is work-
force or Class B housing. Many in the industry today prefer the term “attainable
housing.” Whatever the name, in many markets, there isn’t enough of it, and
prices can be a strain for those who need it.
“Everyone is aware that there is an affordability crisis in housing, and it
doesn’t just affect people who don’t make any money — it affects people who make
a decent living,” says Jeffrey Engelstad, CCIM, FRICS, professor of practice at the
Burns School of Real Estate and Construction Management at the University of
Denver. “In some markets, you might need to make 130-140 percent of the [average
median income] to afford a home.” The University of Denver, he adds, sees attain-
able housing as such a pressing issue that it’s hoping to offer a special semester-long
course on the topic this fall.
Supply is part of the issue. Rental housing construction has remained steady;
360,000 rental units were completed in 2018, according to the 2019 State of the
Nation’s Housing report from the Harvard Joint Center for Housing Studies. But
those were primarily aimed at high-end renters, and, according to the study, the
number of units renting for less than $800 a month has decreased every year since
2011 — a net decline of four million units.
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