'Employer-assisted housing programs can be demand or supply driven ... programs include down payment assistance, closing cost assistance, rent subsidies, secondary (gap) financing, moving cost assistance, and homebuyer education.'
Case Studies
- Restrictive land use regulations and regulatory constraints are barriers to the construction of new housing. Eased zoning restrictions that allow for density bonuses and reduced frontage, setbacks, greenspace, parking, and/or driveway requirements as well as expeditated permitting and approval processes, established maximum or minimum lot sizes in sewer service areas, and requirements that allow accessory dwelling units (ADUs) are strategies to facilitate the construction of new housing.
- Collaboration among community development financial institutions can result in innovative opportunities to provide and enhance housing for low- and moderate-income individuals such as social investment funds that provide private capital to nonprofit community development groups or land trusts that acquire and lease properties to low-income individuals.
- Employer-assisted housing programs can be demand or supply driven. Demand-driven programs include down payment assistance, closing cost assistance, rent subsidies, secondary (gap) financing, moving cost assistance, and homebuyer education. Supply-driven programs include cash contributions, land donations, construction financing, and low-income housing tax credit investment. Additionally, a variety of financing options are available to employers and their development partners such as Low-Income Housing Tax Credits, tax-exempt bond financing, low-interest loans, and grant funding.
- Strategies to diversify the housing stock include utilizing tax incentives, such as sales tax exemption of construction materials, to reduce workforce housing costs, establishing workforce housing tax increment financing districts, requiring municipalities to have at least one zoning district that allows multifamily housing construction, and providing financing for workforce housing in rural areas.
Summary
- The growth in home prices in Ohio between 2015 and 2021 outpaced the growth in median household income. After adjusting for inflation, the median sale price of residential property transactions in Ohio increased by $5,920 between 2015 and 2021. During that same period, median household income in Ohio increased by $2,154, after adjusting for inflation. The growth in median sale price was even larger for residential property transactions affordable to households with income between 60% and 120% of the area median income. On average, the median sale price of residential property transactions affordable to households with income between 60% and 120% of the area median income increased by $31,660 in Ohio between 2015 and 2021.
- Permits issued for new construction of single-family homes represent the potential future new housing supply. Of permits issued in Ohio between 2015 and 2021, approximately 14.3% of permits had an average value affordable to households with income between 60% and 120% of the area median income. Approximately 84.9% of permits issued had an average value affordable to households with income above 120% of the area median income. Of total households in Ohio in 2021, it is estimated that 58.1% had a median household income below 120% of the area median income. This means that the potential future new housing supply in Ohio would be unaffordable to approximately 58.1% of households in 2021.
- Between 2020 and 2021, inflation and home prices in Ohio have increased by 4.7% and 12.6%, respectively. Meanwhile, the share of homes sold in the United States that were affordable to a family earning the local median income declined by 14.1 points between the first and second quarters of 2022. In the second quarter of 2022, less than half (42.8%) of homes sold across the United States were affordable to a family earning the local median income. Additionally, the majority of jobs projected to be added to the economy in Ohio between 2021 and 2031 had average annual earnings in 2021 that were below the statewide average across all industries.
- Although the State of Ohio has existing housing that is affordable to households with income between 60% and 120% of area median income, home prices increased at a higher rate than household income between 2015 and 2021. Additionally, the potential future new housing supply will be unaffordable to the majority of households in Ohio, especially given the types of jobs projected to be added to the statewide economy between 2021 and 2031.