ECONOMIC IMPACT OF HOUSING Kate Little Georgia State Trade Association of Nonprofit Developers

JOB SPIN-OFF Jobs generated in industries producing lumber, concrete, lighting fixtures, heating equipment, and other products that go into a home Professional jobs created for architects, lawyers, lenders, real estate agents

NAHB estimates for 2005: 3.47 jobs, for an average single family unit 1.29 jobs, for an average multifamily unit

NAHB estimates combined taxes for 2005: $82,269 in tax and other government revenue, for average single family unit $30,807 in tax and other government revenue, for average multifamily unit

100 Single-Family Homes One-Year Impact $16.0 million in local income $1.8 million in taxes, other revenue 284 local jobs/$11.3 million in wages Impact $3.2 million in local income 63 local jobs/$2.3 million in wages

100 Multifamily Units One-Year Impact $7.0 million in local income $710,000 in taxes, other revenue 133 local jobs Ongoing Annual Impact $3.2 million in local income 52 local jobs

Lee County, Florida The Public Costs of Inadequate Affordable Housing Study, September 2002 Economic impact of NOT constructing affordable housing

Three Indicators Lost jobs and wages (based on not constructing housing) Lost consumer spending (amount of $ lost as result of HHs paying more than 30% of their income for housing) Lost property taxes (based on sales price of $120,000)

Public Costs of Lost Economic Opportunity (2002) Based on construction of 2,000 owner-occupied units Lost jobs & wages - $158 million Lost consumer spending - $78.6 million Lost property tax revenue - $3.3 million

Calculation of Lost Wages 2000 units = 4,896 jobs = $158 million in wages (average wages of little less than $32,500 annually)

Calculation of Lost Property Tax Revenue 2000 annual units not built $1,644 average tax bill not collected $3.3 million annual tax revenue not collected

Economic Impacts of Targeted Community Investments The Ripple Effect, published by Richmond LISC Studied economic impact of highly focused public and nonprofit community investments in 7 neighborhoods in Richmond over 5-year period

Study Findings Housing prices in targeted areas appreciated at rate of 9.9% per year faster that citywide average Prices in non-targeted block, but within 5,000 feet, increased annually at rate of 5.3% faster than citywide average Most significant home price impacts occurred after minimum investment of $20,100 in same block

Additional Study Findings Aggregate value for tax assessments in target areas increased between 44% and 63% During first 3 years, crime dropped by 19% compared to 6% citywide

Role of Local Governments Work with employers to encourage employee homeownership incentives (e.g., down payment assistance, low- interest loans) Establish alternative design and development review standards to promote in-fill and affordable housing

Role Continued Forgive overdue property taxes and liens on vacant properties identified by nonprofit housing developers Make available surplus government- owned land for affordable housing development

Role Continued Establish Affordable Housing Trust Fund to provide locally targeted and managed assistance for affordable housing. Nearly 300 housing trust funds in U.S. — 37 states have trust funds, rest mostly run by counties and cities. Variety of revenue sources: some portion of local real estate transfer tax, penalties on late payments of real estate taxes, and fees on other real estate–related transactions.