Midland housing study finds 3,000 renters cost burdened

By Kate Carlson

Apr 3, 2018 | Original Article

It is affordable for the average household to buy a home or rent in Midland, but the market is failing the county’s more than 3,000 renter households that make up the lowest earners.

This was one of the highlights of a recent housing market analysis and affordable housing needs assessment carried out by czb LLC, a Virginia-based urban planning firm. czb was retained by Midland County Habitat for Humanity, in partnership with the City of Midland, the United Way of Midland County and Midland Area Homes.

The study was recently presented to the City of Midland Housing Commission and other stakeholders involved in housing across Midland. Results are available on the city’s website and will be used by city staff, the housing commission, city council and other organizations in the community, said Grant Murschel, director of planning and community development for the city.

For rental households earning more than $35,000, a breadth of choices between $500 and $1,000 makes Midland an affordable area in which to rent, the report states. It says for rental households earning less than $20,000, being forced into the same $500 to $1,000 price range means paying more for housing than they can afford.

A lack of low income affordability, combined with an overall soft housing market, have also caused deterioration in neighborhoods and economic development challenges, according to the study.

Statistically, Midland County has not changed much since 2000 in terms of population, which has increased slightly; employment rate, which has decreased likely due to an aging population; and income level, which has risen slowly outpacing the rest of the state but not still not keeping up with inflation.

Affordability, as defined by the U.S. Department of Housing and Urban Development, is when housing costs for a family does not exceed 30 percent of their income.

The amount of cost-burdened families has remained pretty steady since 2000 at 40 percent, meaning they are paying more than 30 percent of their income to housing payments.

The poverty rate increased from 8 percent to 13 percent between 2000 and 2015 in the county. Poor households are also disproportionally renters, and struggle to afford rent rates considered low by national standards.

Half of these households are female-headed families, usually single mothers or elderly women living on their own.

“Midland County overall is affordable for renters,” said Eric Ameigh from czb. “There hasn’t been a time at least since 2000 where the median rent in Midland County has exceeded the ability of the median renter. But not everybody is at the median.”

Households earning less than $20,000 annually will be hard to place in quality housing at an affordable rate in any market, Ameigh explained. The private sector is largely unable to fill the need for the lowest income bracket because new rental units require about $1,200 a month in rent to turn a profit.

“This is not a housing affordability problem, it’s a housing price problem,” Ameigh said. “What we have here is an income problem. The private market can not serve that.”

There is a deficit of 1,042 rental units in the county and 1,024 rental units in the city for the lowest earners.

“We don’t want people to lose sight of the fact that there are good things happening in Midland,” Ameigh said. “One of the things that leaves us so optimistic about Midland is that it has a capacity that most other places don’t have through corporate and philanthropic organizations.”

Ways to address the problem will likely include a combination of corporate and philanthropic effort, Ameigh said.

The end of the study presents possible ways to address each of the presented issues, which include building new units with provisions for permanent affordability, rehabilitating older units, and housing choice vouchers. Offering subsidies to landlords offering high quality, affordable rentals could be part of a solution if the market is regulated.

“It’s not cheap or easy, and must be coordinated — it can not be done in a vacuum,” Ameigh said. “So if you’re doing economic development efforts, neighborhood revitalization efforts, planning and zoning, these things need to handshake each other.”

The solution must include not trading quality for affordability, Ameigh said.

One of the housing commissioners said this means rental inspections and codes must be updated to maintain higher quality among rental units.

The housing market’s largest deficit in affordable homes is for households earning more than $75,000. According to the study based on 2016 data, there is a gap of 6,119 owner units in Midland County and a gap of 3,316 owner units in the city of Midland. Other household income brackets have an excess of homes to choose from in terms of ownership.

The $56,438 study was funded by The Dow Chemical Co. Foundation, the Midland Area Community Foundation and the City of Midland Housing Commission.