Page 17 - The City of Greensboro Conditions and Trends

CITY OF GREENSBORO COMPREHENSIVE PLAN CONDITIONS & TRENDS

Changing Demand for Housing Choices

The Trends

Three primary trends are changing the level of demand for a variety of housing types, both at the national and local levels.
First is the large and growing number of households in poverty, for whom many housing options, especially
homeownership, are financially unattainable. The percentage of US households renting has increased significantly over the
past decade, and in Greensboro, more households now rent than own. Second is the general socioeconomic trend of the
young and highly mobile Millennial Generation now rivals the Baby Boom Generation as a primary driver of the US
economy. The third trend is that affordable housing (or the potential for developing it) is frequently found in the locations
that are highly sought after by households least concerned about affordability. These traditional walkable urban
neighborhoods can become the sites of contentious debate about the positive and negative effects of redevelopment.

Background

In economics, demand is defined as a combined willingness and ability to pay for something. Households in the lowest
income segment of our population have less ability to pay for healthy, safe, appropriate housing. As a result, the ordinary
housing market does not adequately meet their needs. With a growing percentage of households in poverty, the “American
Dream” of owning a single family home in a suburban neighborhood has become increasingly unattainable. The percentage
of home-owning households in the US peaked around 2006 at 68.7% and has declined to 63.4% in 2016, with a
corresponding increase in renter households. High financial barriers to homeownership have the effect of excluding a
growing number of Americans from both the cost-saving and wealth-building benefits of owning versus renting.

Despite the increasing prevalence of rentership and the fact that renting is an appropriate option at some point during
nearly every American’s lifetime, there remains a strong cultural stigma against renters and rental housing, even among
renters.

National housing preference surveys and demographic trends point to a 20% to 35% gap between supply and demand for
housing in walkable urban places during the next decade. There is expected to be a shortage of three million units of small
lot and attached housing units nationwide. Taken as a group, Baby Boomers and Millennials have the affluence and mobility
to influence the housing market. Research by the National Association of Realtors and others indicates that Baby Boomers
and Millennials have very similar preferences regarding housing options and residential environment; both groups strongly
favor:

Shorter commutes Living in proximity to shops and services
Walkable urban neighborhoods and small cities, Living among people with a mix of incomes
over auto-oriented suburbs Living in areas with a mix of residential options
Small or no yard to maintain Access to quality mass transit
Rental over ownership

Numerous analysts and national experts have noted that the variety of available housing types in the US is not well-aligned
with current or anticipated levels of demand. Currently 53% of the US housing market consists of one- or two-person
households. By 2025, 25% or fewer of US households will include children. The current supply of large-lot, single-family
dwellings is sufficient to meet the anticipated level of demand for that product type through 2025.

The term “Missing Middle Housing” refers to dwelling types that span the middle ground between detached single-family
homes and mid-rise multi-family residential: duplexes, triplexes, and fourplexes; courtyard apartments; bungalow courts;

DRAFT -17- March 15, 2018