Housing: Another Opportunity for Innovation
Most of you know me from my work in retirement security. Recently I’ve been working across financial wellness lines into some related, and perhaps even more important, influences on family financial security.
For the last year, I’ve been talking with folks from communities across Oregon about the challenges they face meeting their basic needs. One of the most common issues that comes up is lack of access to affordable housing. This is true in rural areas as well as urban markets like Portland. When my out-of-state relatives talk about Portland, they inevitably bring up the topic of housing costs and homelessness.
The numbers are stark: a shortage of 7 million affordable homes nationwide, more than half a million people experiencing homelessness per night, 70% of people with low-incomes paying more than half their income in rent, only 25% of extremely low-income folks who need assistance receiving it. The ripple effects are enormous, impacting the immediate and long-term economic stability of families and whole communities. It’s hard to think about, plan, or save for the future, when you don’t have adequate shelter or may lose it tomorrow.
I’ve read quite a few analyses of the root causes. The most obvious is supply and demand, with not enough homes being built. Every day, someone pens a new thought piece on how to tackle the problem. One barrier that emerges over and over again is zoning, which restricts developers and builders from building more housing and denser housing.
But stark doesn’t mean stuck. In Oregon, we’re on the cusp of a major shift in zoning law. In 2019, the Oregon Legislature passed House Bill 2001, which basically does away with single-family home zoning in larger cities. Where once you could only build single-family, detached homes, you can now build duplexes, triplexes, quadplexes, cottage clusters, and townhouses. The assumption is that this change will lead to more infill/greater housing density, increased housing options/choice, and potentially greater affordability.
In my local town, we are updating our community development code to accommodate this change in zoning. In public meetings, we’ve had long discussions about esoteric topics like floor-to-area ratios, trying to understand the impacts of changes in zoning will have on the housing market, home values, and the community as a whole. For all that talking and analysis, I personally still have no idea what quantifiable difference any of this will actually make in the end. Will it make any dent in the housing crisis? I suppose we’ll find out in five to ten years.
I think it’s safe to say, however, that just changing some aspects of zoning isn’t going to be a silver bullet that solves the housing crisis, especially if we’re not addressing other issues that also impact the whole well-being of people, families, and communities. Some of the other issues folks across the state have told me about are low-paying jobs and a lack of access to mental health resources. These too contribute to our housing crisis and overall economic instability, and we’re going to need to take action in those areas as well.
Change is hard, uncomfortable, and often doesn’t work out the way we want it to, but for a crisis as substantive as this one, we really do have to act. We have to try something new, and if that doesn’t work, try again. It took a lot of factors and time to create the problem, and untangling will take a lot of different, innovative efforts and time as well.
Columnist and Senior Associate Joel Metlen is based in Oregon. Joel is a pioneer of the state facilitated retirement savings space, woven into a career of public service and innovation. At OregonSaves, Joel’s responsibilities ranged from marketing and employer engagement to operations and data analysis. You’ll see his insights from that experience, and more, here.
This piece was featured in the June 30, 2022, edition of Retirement Security Matters. For more fresh thinking on retirement savings innovation, check out the newsletter here.
