Workforce housing is affordable housing for households earning between 60-120% of their area median income (AMI).

What is Workforce Housing?

An Essential Property Management Term

Workforce housing is affordable housing for households earning between 60-120% of their area median income (AMI), according to the Urban Land Institute (ULI). Workforce housing is intended to support middle-income workers, including police officers, firefighters, retail clerks, and teachers.

Often, these households don’t qualify for Section 8 (also known as the Housing Choice Voucher program) or the Low-Income Housing Tax Credit program – so workforce housing provides a safe, affordable solution.

A Brief History of Workforce Housing

Starting in the late 1990s, American incomes began to “lag behind rising costs of living, and housing supply for middle-income workers grew stagnant, causing an acute need for Workforce Housing, especially in larger metropolitan areas,” according to an article from the Community and Economic Development in North Carolina (CEDNC) at the University of North Carolina. The Great Recession exacerbated the issue of housing affordability as the production of new housing units all but stopped. 

With low housing inventory and high home prices, workers continue to need help accessing affordable housing. As a result, many local governments are examining strategies to stimulate workforce housing creation, CEDNC says.

How to Create Workforce Housing

In 2017, the Board of County Commissioners of Collier County in Florida sponsored ULI to advise the local government on how to increase affordable housing and address its workforce housing needs. CEDNC summarized a few of ULI’s suggested strategies as follows:

  • Create a dedicated housing trust fund
  • Repurpose vacant land and underutilized retail space
  • Adopt inclusionary zoning 
  • Create a community land trust
  • Update land development codes to encourage development in already urbanized areas
  • Allow single-family homeowners to build and rent out accessory dwelling units

But the first step to increasing the amount of affordable and workforce housing development is within the community directly. Raising awareness of this issue unlocks the potential for productive conversations that dispel misconceptions about affordable housing, including fears about who would be moving into the neighborhood.

Is Workforce Housing Section 8?

No, workforce housing is different than the Section 8 housing program. Both focus on the need for affordable housing, but Section 8 serves low-income individuals and families while workforce housing serves mid-income families and individuals.

Also, Section 8 housing is sponsored by the government, so landlords within this program receive rent subsidies. Workforce housing isn’t sponsored by the government at this time.

Should Landlords Invest in Workforce Housing?

Consult your real estate attorney first, but if there’s an opportunity for you to provide workforce housing at a reasonable price, we say do it! Not only will you be growing your portfolio, but you’ll also be helping to build your community.

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