Don Fry Commentary on WYPR
The cost of housing has more than doubled in Maryland during the last five years. This dramatic increase has been caused partly by good fortune – economic growth, more jobs, good wages, and lower interest rates, which translate into greater demand.
Also, local economic experts note that “smart growth” master plans and zoning laws designed to discourage growth in suburban and rural areas have, in effect, limited the Baltimore region’s housing supply during a period of increasing demand. Between 2000 and 2004, the Baltimore region’s population increased 3.4 percent. Yet new housing starts in the region are decreasing at an average annual rate of 3.8 percent, according to the Greater Baltimore Committee’s 2005 State of the Region Report.
Not only does our region have a deficiency of housing starts, but a more troubling aspect of the housing price boom is the scarcity of affordable workforce housing — homes for those in the broad middle class – teachers, firefighters, public-sector workers, nurses, office workers.
To purchase an average-priced home in Maryland, someone making an average wage would have to spend 71 percent of his or her net income to cover the monthly payments, a recent Sun article reported. For a two-income family, that percentage would drop to 35 percent – still high for a family.
And, the problem could get worse. The Baltimore Metropolitan Council projects an influx of 320,000 new jobs in our region by 2025, but only enough housing production to support 240,000 jobs. This would leave more than 75,000 workers in our region with little hope of housing, much less affordable housing.
The challenge for elected leaders, planners and homebuilders is clear. First, for our region to thrive, we must develop public policies to produce housing for a significantly larger workforce in 20 years. And we must find creative ways to accommodate the housing needs of the full range of people who will make up our region’s workforce – the G-16 federal employee and the firefighter … the CEO and the nurse … and the research scientist and the lab worker.
While we reap the financial benefits created by escalating values of our existing homes, we must remember to create a path to home ownership for the next generation.
For the Regional Business Report, this is Don Fry, President of the Greater Baltimore Committee, for 88.1 WYPR, your NPR news station.