Affordable housing is a housing facility provided to families belonging to the low-income group. These housings are between luxury housing and affordable housing. However, workforce housing is not of one category. Different ones depend on the needs and requirements. Typically, these housing estates serve families who are earning 80 to 120% of the median income. Hence, they are not in a position to invest a considerable amount of money in rent and purchase of a house. In the workforce space, different firms have come up to create products for serving the requirement of working families.
However, the income of these families is less than sufficient. Hence, there is a dropping rate of their housing expenses. These individuals are also finding it hard to keep pace with the growing costs of the food chain and other related luxury items. The widening gap between the upper and the lower section of society is a cause of concern. It has impacted the real estate industry in different ways. Various investors are now taking an interest in building affordable housing for these individuals. Hence, in the metropolitan cities, you will see a growing craze for affordable workforce housing.
Affordable housing versus workforce Housing
When discussing the housing industry, you will come across affordable housing and workforce housing. These two are not similar. Often, you will see people confusing themselves with these concepts. Although the terms look synonymous, they are not. In the commercial real estate industry, these two are critical aspects.
As the name suggests, affordable housing serves individuals and their families below 60% median income. Hence, between 0 to 60% are those families that cannot afford housing for themselves, states Maxwell Drever. They thereby depend on governmental programs and local municipalities for their housing requirements.
On the other hand, workforce housing is for individuals earning between 61% and the upper figures. These middle-income groups do not rely upon government subsidies. All they need is moderate rent of houses.
The crisis of affordable housing
Now that you are aware of affordable housing and workforce housing, it’s time to understand the problem of the weaker sections of society. These individuals coming from the lower rungs of society have to deal with various expenses. Maxwell Drever says their average income is insufficient, whether it is tax demands or expenses on daily allowances. They are on the end of the spectrum. These individuals coming from the lower-income group are always on the lookout for affordable housing.
For solving the problem, various non-governmental and non-profit organizations have come up. Their only aim is to shelter these individuals. They take care of the governmental regulations and subsidies. These investors have come up with well-designed real estate projects to solve the problem and help individuals get attainable housing. They are using different mechanisms to provide individuals with what they require.
They also use government subsidies to forget low-cost construction material, market rent, and much more. Hence, they are building small units on different land tracks to provide individuals with low-cost housing.
