Business Called on to Help Address Affordable Housing Crisis

The private sector needs to play a bigger role in increasing the amount of affordable housing for Portland’s low- and moderate-income residents, said panelists at a breakfast seminar hosted by Oregon Business magazine today.

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As Portland’s affordable housing crisis deepens, policymakers are looking to the business sector to increase the availability of cheap residences in the city – an area of the housing market that was once the sole purview of the public sector.  

“Private developers have a role and a responsibility to develop housing at all different (income) levels”, said Sarah Zahn, senior project manager at real estate investment and development firm Gerdling Edlen.

Legislation working its way through Oregon’s House and Senate that would require builders to include a certain number of affordable units in their development plans, a provision known as inclusionary zoning, is aimed at giving the private sector more of a role in solving the affordable housing crisis.

Oregon is only one of two states – the other is Texas – that prohibits inclusionary zoning. The practice has contributed to a deep shortage of cheap housing that is made worse by Portland’s rapidly expanding population.

DSCF5558Kurt Creager, director of the Portland Housing Bureau, estimates 24,000 extra affordable housing units are needed to satisfy demand for cheap housing. “We have a lot to be proud of as a city, but what we have noticed is that there is a cultural diaspora – people of color are being displaced to less accessible parts of the city. Recent policies try to ameliorate that.”

The bill to prohibit inclusionary zoning will not solve all of Portland’s housing crisis, said real estate developer Ed McNamara, whose firm Turtle Island Development builds affordable multifamily rental units. He pointed to other jurisdictions that have inclusionary zoning policies that have not led to high numbers of cheap housing. “We need to use existing resources more effectively,” he said, citing the city’s expensive operating costs for developers.

McNamara said there is a particularly serious shortage of housing for moderate-income residents. He has seen waiting lists for subsidized housing that are up to 40 years long. This shortage is bad for the business community because it makes it difficult to hire people on moderate incomes.  “It is tough to recruit people if there is no support for people in the middle,” said McNamara.

These business concerns are echoed by Justin Buri, executive director of the Community Alliance of Tenants, an organization that advocates for low-income tenants in private housing. The lack of affordable housing leads to an unhealthy workforce as the threat of eviction – a growing problem in the city – often causes tenants to take time off work to find a new place to live. 

Buri advocates for developers to build all types of affordable housing – not just multifamily residences, but also single-family residences suitable for larger families. “It is important that affordable housing is not monolithic,” said Buri.