Key Markets for Employer-Assisted Housing Strategies
During the 1990s and until the bursting of the “housing bubble,” employer-assisted housing proved to be advantageous to employers, employees and the housing industry. Employers used employer-assisted housing to address core business problems or recruitment, retention, the need to reconfigure benefit costs, and/or revitalize communities in which the employer operated. Employees were interested in getting into home ownership as quickly as possible in the face of a rapidly rising housing market and in the face of a rapidly rising housing market, the housing industry from Fannie Mae to the corner real estate agent was interested in finding additional sources of funding for buyers who lacked sufficient savings for a down payment.
Today, while employer-assisted housing is still well-suited to address bottom-line business problems, the housing needs of workers are different and the markets in which employers are operating and employees are considering their housing options are also changed. Employer-assisted housing techniques have the capacity to be customized and meet changed conditions. Moreover, with proper public incentives, employer-assisted housing programs can be structured to achieve public and private sector goals that respond to today’s housing needs and markets.
Below are seven niche strategies where employer-assisted housing can be used to meet the needs of specific types of employers, employees and communities.
- Neighborhoods impacted by high vacancy rates due to foreclosures. EAH programs can be structured to help reduce foreclosures and the vacancies that have resulted from foreclosures. By leveraging employer aid with various public and private anti-foreclosure programs opportunities exist to have effective programs at minimal employer cost.
- Smart growth and transit oriented development. Incorporating affordability into TOD activity has been problematic. Employer-assisted housing program can be used to create a permanent source of affordability within such targeted areas.
- Areas where employers are acting in concert with other revitalization activities occurring in a community. Many employers actively work with public and nonprofit sectors to support the revitalization of communities in which they operate. Employer-assisted housing puts the purchasing power of employees behind such efforts.
- Public and nonprofit organizations. Cities are increasingly interested in “meds and eds” as an economic development strategy. Uniting this strategy with employer-assisted housing: a) provides housing opportunities for the employees these expansions will attract; b) diminishes gentrification pressure on impacted neighborhoods; and, c) fosters 24-hour communities which will create additional jobs in impacted neighborhoods.
- High Tech Development. Whether in urban or suburban locations, companies seeking high tech workers are often seeking employees who are young and have lots of student debt and limited savings. Enabling these employees to obtain better housing options can be a good way of recruiting and retaining these employees.
- Rental and limited equity housing. America’s permanent recession means that increasingly contingent workers who own a home can find themselves saddled with a highly illiquid asset and a need to rapidly relocate to an area offering better employment opportunity. Employers offering rental and limited equity housing would be a useful way of supporting worker mobility.
- Substantial rehabilitation/conversion of industrial properties provides an opportunity for employers in an area to decommission obsolete facilities while strengthening communities in which they continue to operate. Properly incented by the public sector, an “old factories/new neighborhoods” policy would reward employers that remained in a community, but needed modern facilities in order to continue to operate.