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Building a Foundation for Workforce Housing

When I took over the reins of the 220,000-member National Association of Home Builders almost one year ago, I promised that I would dedicate my efforts and the resources of our organization to finding a solution for the growing shortage of affordably priced housing for the heroes in our workforce who make a vital contribution to our communities. Generation after generation, we have come a long way in America, steadily expanding housing opportunity for our families. There have always been challenges standing in the way of that progress, and we have always worked hard and succeeded in overcoming them, building a stronger, more efficient housing delivery system in the process. There is no reason that we cannot overcome the obstacles that are increasingly preventing the workers we value the most from living in the same neighborhoods they serve, and I am confident that we are well on our way to implementing strategies that will make this happen.

Housing affordability has always been a challenge for our industry. In fact, affordability has always been a primary goal of our housing finance system. The creation of the low-downpayment, 30-year mortgage opened the door for housing opportunity for typical working households across this country. When our soldiers returned from World War II, we saw production builders move into high gear. By building an affordable, entry-level product that could be financed with an affordable mortgage, our industry provided millions of Americans with access to the American dream. In the years that followed, as those families moved forward in their careers, we saw them trading up to bigger, more expensive houses. We called it the housing ladder, and most of the time — when mortgage rates were at affordable levels — it worked well as a conduit for the accumulation of family wealth.

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I started in the building business in the 1970s, so I was around for the devastatingly high interest rates of the early 1980s. It was obvious even before then that passbook savings accounts were not enough to provide our industry with the capital it needed. So we hitched our wagon to the secondary mortgage market, and we solved the problem. In more recent times, we have seen incredible innovation in housing finance that has further expanded housing opportunity in this country. On top of that, for the past few years American home buyers have enjoyed the lowest mortgage interest rates since the 1960s. You’ve seen the results in the headlines. Our national homeownership rate has risen to an all-time high. People have been buying homes at a record pace. And home builders have been building as fast as they can to keep up with the demand.

From reading those headlines, you might not know that America today has a serious housing problem. It is a sobering fact that working families — the teachers, firefighters, nurses and other workers who are the heart and soul of any community — cannot find affordably priced housing in the communities they serve. Many of those communities have failed in their commitment to provide affordable housing. Many of those communities are actually responsible for sky-high land prices and housing prices because they have embraced zoning and other regulations that are designed to stop residential growth. There are many causes of today’s workforce housing problem, but the bottom line is that in recent years, the disparity between housing prices and the incomes of these workers has only grown worse.

I am a home builder, and that means that I share in the optimism that is almost a prerequisite for success in an industry where we face challenges at every turn and must always keep a steady focus on our mission to build the housing that our growing population needs. NAHB’s Workforce Housing Symposium has increased my confidence that we will turn the tide in communities across this country. We have delineated the problem and its root causes and we have identified initiatives that are beginning to answer the need for workforce housing. We have heard from the Secretary of Housing and Urban Development his assurance that a top priority for the President is pursuing policies that will address this problem, and rightfully so because it also a top concern of the American people. We have heard from the CEO of Freddie Mac about new programs in the secondary market to further its mission to expand housing for our workers. And we have heard from home builders, employers and representatives from the public sector, who have shared their experiences and expertise about how we are going to get the job done.

We have built a solid foundation from which we can address our workforce housing needs. It’s time for housing to give a hero’s welcome to the dedicated men and women who work on our behalf, and there is no better way of showing our appreciation for their vast contribution than to bring them the housing that will ensure they remain an essential and enduring force in our communities.
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