Providing affordable, decent housing is a mounting challenge in developed and developing economies says Maxwell Drever. Since the demand exceeds the supply, it affects productivity, growth, and mobility in the economy. Fortunately, there are means of narrowing the gap between demand and supply. If you look at the market-based approach, you will see that various municipal corporations have come forward to solve this issue of eviction.
Who makes the workforce population?
The workforce population is moderate, and low-income households live in low-quality housing estates. They get financially burdened by education, healthcare, and housing payment. By 2025, the figures are exceeding more than 440 million households. Hence, 1/3 of the urban population constitutes the workforce group.
Why is the affordable housing crisis affecting everybody?
Replacement of substandard housing and construction of additional units require a smooth flow of funds. The workforce housing issue is a problem for the workforce population and the government in general. Hence, investment in these projects is the responsibility of federal governing authorities.
It will reduce the cost of housing and increase the housing supply by 50%. Hence, the workforce-housing crisis is also an issue for employers. These individuals who are the owners of means of production face challenges in getting on-time service from laborers. The workforce population has to stay far away from the urban centers in the suburban location.
Is there any solution?
Efficient land use is one of the first steps the governments have to take to solve this problem.
• Acquisition of land is significant, too, in the correct location. Getting land at a reasonable price can reduce the housing cost to a considerable level, believes Maxwell Drever.
• Along with this, location plays a vital role. If the area does not have adequate water, transport, sanitation, and electricity, things will not be smooth.
• Hence, real estate investors and developers have to invest in these sectors and try to expand the land use. The government has to join hands with the non-governmental organizations and equip these areas to assist the inhabitants.
By loosening land-use restrictions and supporting real estate development projects, you can achieve a lot to increase the value of these units. Municipal authorities, real estate developers, and investors are the players in this regard. They have to take the help of government financing projects to ensure a smooth supply of housing units. Along with this, Maxwell Drever states cross subsidy may also increase the supply of housing units across different income bands.
Need for adequate construction policy
For expanding affordable housing, an efficient and cohesive construction policy becomes necessary. Housing construction industries are highly fragmented. Hence, what is required is the coming together of different sectors to boost this phenomenon of affordable housing construction. By standardizing several design elements, light, fixtures, height, ceiling, and also flooring, construction companies may cut down their cost and increase the supply of workforce housing units. Once it becomes a reality, every section of society will flourish.