Safe and permanent housing solutions
One of the hottest topics is housing for the homeless, as it is a major concern for the state. Discussions about what safe and permanent housing solutions look like included SRO (Single Room Occupancy) models. SROs are residential properties that include several single room apartments and in many cases offer communal facilities. They were a common solution to homelessness in the early and mid-20th century, but many became uninhabitable and were torn down because of the dilapidated condition in which they were located and/or tax incentives to do so and convert them to something else. We have seen a resurgence in recent years and expect it to continue. This model allows for flexible design, use of limited space and creates functional and practical living on an affordable base/model.
Fair Housing / Inclusive Practices
Fair Housing goes beyond low income and allows for a wide range of rental prices and affordability, creating flexible models and designs that offer a healthy return on investment for developers and investors, while meeting different housing requirements and needs by area, region and country. demographics. Inclusive housing is also important because lifestyle norms and gender identity definitions are changing, and fair housing practices must be respected. This sometimes requires changes in zoning and redistricting laws and enforcement and/or implementation of FHEO Fair Housing and Equal Opportunity practices and standards.
Related social services and support programs
The opioid crisis and substance abuse as well as mental illness, stagnant wages and inadequate training and education – all of which exacerbate social and income inequality – are triggers for the affordability/opportunity gap. Community and social programs designed to lift people out of poverty and stabilize individuals, families and communities are part of the affordable housing solution.
Affordable Housing Solutions.
Strengthening partnerships between communities, developers, lenders, agencies, and residents
Lenders were encouraged to create more flexible, efficient and appropriate financing options when traditional tax credits and financing/equity investments alone are not enough. Lenders can create more appropriate types of loans that allow developers to meet the demand for affordable housing while making a profit and meeting the needs of the community and its residents. Communication and collaboration are key to determining what is most beneficial from one neighborhood/project to another.
Overcoming bureaucracy, making the process more efficient, and finding new solutions to decades-old problems
New state programs
- Homekey focuses on developing a range of housing types for the homeless or those at risk of becoming homeless. They range from hotels and motels to single-family homes and apartment buildings and aim to provide “permanent or transitional housing for the target population.” Homekey is an example of a publicly funded program designed to encourage and support development in one specific area.
- The Middle Income Housing Tax Credit (MIHTC) is similar to the Low Income Housing Tax Credit program. These tax credits, issued at the federal level to public housing agencies, can be allocated and made available to developers of affordable housing. Once investors raise and purchase the credits, the developer will be able to get a share and invest in the construction of apartments or properties that qualify for the MIHTC. To qualify, these properties must set aside 60 percent of the apartments for households earning 100 percent or less of the area’s median income. MIHTC will create another tier of affordable housing that will pay higher rents while meeting the needs of the underserved sector. It also gives developers/investors the opportunity to create mixed-income/multi-purpose properties, not just low-income housing, which can sometimes be difficult from a cost-effectiveness standpoint.
Where are the new opportunities for growth and development?
- Urban infill and adaptive reuse provide creative housing opportunities, while breathing life into older properties and filling empty lots with new development.
- Rural migration means cost-effective land, which means more cost-effective upfront costs. But it also raises concerns about utilities and infrastructure, as well as transportation, communications, and employment opportunities for residents.
New Energy Regulation and Incentives
All types of multifamily dwellings will now be subject to the same energy code requirements. Previously, there were differences in requirements between low-rise and high-rise. Now a low-rise apartment building and a high-rise apartment building will be in the same category.
The new energy code is largely aimed at encouraging decarbonization/conversion to electrification.
The SOURCE energy category was added when determining energy ratings (SOURCE encourages electricity over natural gas).
For new construction, natural gas furnace installations must also be pre-wired for electric heat pump installation.
This does not apply to rehabilitation centers. If your existing property uses natural gas, you can still replace that system with a natural gas system without any penalty (although you will get extra points for switching to electric).
Battery must be included in solar for non-residential buildings (which, in the context of apartment buildings, may include a detached community/residential building).
Residential buildings must, at a minimum, be prepared for battery storage.
Prescriptive solar PV systems are applicable to all multi-family buildings (including high-rise buildings).
Any projects filed for a permit before January 1, 2023, will still be subject to the 2019 energy code, and properties can actually be permitted after January 1 after the proper paperwork is filed.