Cost, inventory, location: Florida’s housing crisis has 3 problems

TAMPA, Fla. (WFLA) — When it comes to solving the housing crisis, three issues stand out. The first is the question of the number of dwellings available. The second is how much it costs to rent, buy or build a new place to live. Finally, if you are building a house or an apartment building, where do you place it?

The latter is a question plaguing Florida lawmakers and developers as more people move into the state and the number of available homes continues to dwindle.

A new bill proposed in Florida’s 2022 legislative session tries to answer the question of where people can build, but in its approach it complicates the question of how much it will cost to build.

Senate Bill 962 aims to determine where you can build affordable housing projects and mixed-use developments. However, it also disrupts the sources of state funding that developers can access when building housing for low-income residents.

SB 962 basically does two things.

First, it allows local governments like county commissions or city councils to allow residential construction on commercial or industrial plots, as long as at least 10% of the units are for affordable housing.

By affordable housing, the Senate analysis said the bill would focus on providing homes or units to those who earn 80% or less of their local median income. In Florida, this may vary by location, such as city or county. Florida’s median income in 2019 was $55,660, according to the state Department of Health.

The second thing SB 962 is to change the way developers build this affordable housing, or mixed-use residential developments can apply for state funding to help with construction. The Senate analysis of SB 962 describes two programs that are typically used for housing construction in Florida, administered by the Florida Housing Finance Corporation.

Instead, the bill gives developers the choice of sacrificing a source of state funding to expand building location options.

“Florida Housing is eligible to receive state and federal funding to run its affordable housing programs. Primary state funding, if appropriate, comes from documentary stamp tax revenue distributed to the State Housing Trust Fund and the Government Housing Trust Fund local”, says the analysis. “Programs supported by the two trust funds include the State Apartment Incentive Loan Program (SAIL) and the State Housing Initiatives Partnership Program (SHIP).”

Under the proposed bill, developers building affordable housing or mixed-use residences would not be able to benefit from building in commercial or industrial areas while receiving funds from the SAIL program.

The loan program aims to provide developers with “low-interest loans on a competitive basis to developers of affordable housing each year.” Funds are available to public entities, non-profit organizations and for-profit organizations that are constructing or performing “substantial rehabilitation” of multi-family units, benefiting low-income individuals and families.

According to the FHFC, the SAILING program requires “that at least 20% of development units be set aside for families earning 50% or less of the region’s median income”. The loans have a 0% interest rate for developers who keep “80% of their occupation for agricultural workers, commercial fishers or the homeless” with a maximum repayment term of 15 years, unless Fannie Mae, one of two federally backed mortgages, does offer alternatives. companies.

Where to build homes has become a bigger issue as more and more people move to Florida. Tampa became the part of the state with the most new residents. The largest portion of new homes purchased in a single region of the state were purchased in Tampa at the end of 2021.

At the same time, the inventory of available homes in Florida continued to decline. Tampa alone saw a 25% decline in available homes and apartments in 2021, with a 7.6% drop in December alone. This led to the city being named Zillow’s Hottest Real Estate Market for 2022.

Rent increases in Tampa have also hit state and national records, though not always at the top of the charts.

At the same time, the inventory of available homes in Florida continued to decline. Tampa alone saw a 25% decline in available homes and apartments in 2021, with a 7.6% drop in December alone. This led to the city being named Zillow’s Hottest Real Estate Market for 2022.

As political figures continue to work on ways to solve the housing problem, analysts from the State of Bureau of Economic and Demographic Research predict that approximately 850 people will move to Florida every day from 2021 to 2026. Materials and locations to build residences make material costs and urban density key factors in how cities plan to grow.

For now, solutions to the questions of where to live and is it affordable remain a work in progress.