Affordable Housing in Hamilton County
Home values are increasing in Hamilton County, but how does it impact our community when 1 in 5 households in Hamilton County are paying more than one-third of their income on housing – a level that’s generally defined as “cost burdened?”
While not often recognized, many Hamilton County residents face significant financial burdens with housing, such as seniors, Millennials recently graduated from college with high education debt, and working families that are both low and middle income.
Stressed household budgets leave folks less capable of preparing for a crisis, accessing preventative health care or planning for retirement. Many homeowners risk foreclosure or defer important home maintenance. These same factors impact performance in the workplace, increase healthcare costs and lower property values. It also helps explain the abundant need at food pantries across the county.
Building a diverse housing stock provides opportunities to improve the quality of life and strengthens the county as a whole. The “Housing Wage,” or wage a renter would need to earn in order to afford the fair market rent, is $12.25 for a 1-bedroom apartment in Hamilton County. However, 23% of the jobs in Hamilton County pay less than the housing wage. A worker earning minimum wage ($7.25) needs to work 68 hours per week to afford a one-bedroom apartment.
While the overall poverty rate in Hamilton County is much lower than the state average, there is an overall perception that poverty is concentrated in the northern part of the county. In fact, 77% of the people living in poverty reside in the four cities (see chart).
A recent United Way report, ALICE: Asset Limited, Income Constrained and Employed, indicates that 17,446 households in Hamilton County meet their criteria for at-risk households. These households struggle to afford the cost of living in Hamilton County.
Further indication of housing stress locally is that in 2011, the Township Trustees reported spending $375,345 to provide housing for 793 recipients (an average of 66 per month).
“Subsidies” are as unpopular as ever, but the largest government subsidy for housing is the mortgage interest deduction. Paid out annually to homeowners who itemize their taxes, these tax benefits directly lowers housing costs for some. Similar programs to support housing cost relief for the most vulnerable is greatly needed.
Public and private partnerships to need to be developed to build more affordable housing units throughout the county, and support programs that address the unmet needs of Hamilton County families.
Growth and Jobs for Hamilton County
It is evident that Hamilton County embraces growth. Growing our businesses and creating job opportunities are an important way to achieve sustainable economic growth. Commerce also provides valuable work to our residents, services to our customers, and vibrancy to our communities.
Finding the balance of new residential and commercial is a continual challenge communities face. Commerce requires a mix of private homes, rental and apartments in order to have good access to both workers and customers. In the past, connecting with the workforce required access to roads. Now, consumers and workers desire to live, work and go to school all within one community. How possible will it be for us to connect housing for workers – such as our Millennials returning home with their new college degrees – with the jobs our communities need filled?
Our communities may be unaware that local teachers, fire and police employees and other city staff are unable to live in the communities they serve, due to high housing costs. For example, in Fishers there are nearly 1,500 households earning less than $25,000 per year, whereas only 254 apartments lease for less than $750 per month. This is indicative of the severe shortage of affordable housing in Fishers and other vibrant areas.
Companies are beginning to reconsider locating in Hamilton County due to the difficulty in finding entry level workers. Hamilton County needs a plan to address this gap. Twenty-three percent of the jobs in Hamilton County meet the definition of “low wage jobs”. These jobs have increased by 22% from 2010-2015.
Quality, affordable housing will generate health, wealth and stability for workers, businesses and communities. Similar to the ways community growth patterns follow the infrastructure, the development of diverse housing types and density can accomplish efficient solutions to various issues. Public and private investments in affordable housing will need to be employed to fill this gap.
Neighborhood Development in Hamilton County – Livability & Sustainability
It is easily agreed that most Hamilton County enjoy a high quality of life, and there is also agreement that there are many ways in which we can do better. For one, long automobile commutes results in more time spent being sedentary, less time with family and far less time or energy to become fully engaged with the neighborhood. High home values also limit the ability of service workers, including teachers and servants, to purchase or rent a home in the communities where they work.
There is often public pushback regarding multi-family housing, in spite of community master plans that indicate the need for density. Smaller communities in the northern portion of Hamilton County hold in tension the need to sustain growth while maintaining their rural character. Tax caps also stress the budgets of each of the city and towns.
The development of transit can reduce commuting costs and encourage workers from other communities to seek the many unfilled entry level jobs in Hamilton County. Transportation choices need to be available to support workers, children, and elderly with little ability or desire to drive.
Hamilton County will continue to be attractive for people who work in Indianapolis, despite the transportation costs, because of the good school districts, home values and the general quality of life. However, planned developments which includes affordable housing options, green space, density, alternative modes of transportation, and walkable streets will keep it sustainable.
Baby Boomers and the Need for more affordable Senior Housing
The Boomer Generation will increasingly will drive the housing market, and Hamilton County needs to prepare for this expansion. “Boomers” were born between 1946 – 1964. In 2011, this generation began to reach the “retirement age” of 65. There will be nearly 20 more years of Boomers entering their senior years. Medical advances have helped peoples live longer, with an average life expectancy of 78 years.
Throughout Indiana, the vast majority of this population does not have adequate assets saved for retirement, and many will rely on Social Security for their sole source of income. In Indiana, only half of private-sector workers participate in retirement plans and the average balance of a retirement plan is $26,971. High payments for either rent or mortgage will increasingly burden the Boomer Generation.
There will be a substantial need for more senior-friendly housing to combat isolation and accommodate the aging population that will continue to grow through the middle part of the 21st Century. The rapid growth of Assisted Living facilities in Hamilton County proves the demand, but these are short-term, costly facilities not designed to resolve ongoing, permanent housing needs of Seniors.
The housing interests of Boomers complement those interests of Millennials in terms of walk-able communities with easy access to amenities and services. The cities in Hamilton County are constructing comprehensive networks of trails and sidewalks, but some communities struggle to maintain their aging infrastructure.
Current zoning ordinances in many Hamilton County communities make it difficult to build smaller houses on smaller lots, which many seniors seek when wishing to downsize, both in terms of cost and actual house-size. A smaller and less expensive house and yard is easier to maintain, yet can be difficult to find in Hamilton County. Furthermore, establishing construction standards that require Universal Design and Visitability are ways to prevent costly modifications in the future and develop a housing product that serves all.
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