Affordable Housing In NC Is Scarce, Here's Why

Oct 15, 2014

Affordable housing options are becoming scarce in North Carolina
Credit capl_@_washjeff.edu / Creative Commons

North Carolina has better houses and apartments for sale or rent than in recent years. But Bob Kucab says with that rise in quality, affordability has become a problem. He directs the North Carolina Housing Finance Agency.

“And the biggest culprit is quite simply that housing costs have risen faster than incomes for most families over the past 10 years,” Kucab says.

Now, developers, real estate agents, lenders and agencies are gathering to share potential solutions.

David Bennett works with the Community Investment Corporation of the Carolinas. Bennett says people should expect to pay about 30 percent of their income on housing and utilities. But he says the gap is widening for North Carolinians.

“When people are paying 35, 40, even as much as 50 percent of household income just to cover those basic housing expenses, it really puts a strain on their budget otherwise and consumes a large part of that household income,” Bennett says.

The National Low Income Housing Coalition says a household has to earn more than $14-per-hour to afford a two-bedroom apartment. But that's twice the minimum wage.

Finance Agency Director Kucab says rising land values also make it more cost-effective for developers to build large expensive houses instead of starter homes.

“We don't have as many starter homes being produced, because land costs are high, and the economics of producing higher-cost homes for upwardly-mobile households is a better economic proposition for developers,” he says. “So there's a squeeze at the entry level segment of the market with less product and steady demand.”

At this week's Affordable Housing Conference, developers, real estate agents, lenders and agencies are gathering in Raleigh today and tomorrow to share potential solutions to increase affordable housing opportunities. Mortgage assistance, foreclosure prevention, and other grants and programs will be on the table.