In the current economic environment, it might seem unnecessary to discuss residential growth. But, the American economy will rebound, and when it does, leading the way will be the housing market. As housing activity picks up, the growth debate will too, especially as it relates to residential development.
I have often remarked that one cannot be both anti-housing and pro-business as the two positions are incompatible. In doing so, I sometimes receive interesting stares that denote either dubiousness or outright disagreement. Being that as it may, a robust supply of well-built, affordable housing is an important component of Virginia’s efforts to retain and enhance its attractiveness to economic investment, i.e. jobs.
It follows, therefore, that it is in our best interest that public policies do not place undue fiscal and regulatory burdens on the production of new housing.
That means taking another look at existing polices like the cash proffer system, especially in localities where proffer demands have reached levels exceeding $30,000 or $40,000 per home. It means examining the proffer system in general, with an eye toward reforming policies that, in effect, allow local planners to dictate personal choices to home owners, increasing the cost of housing by thousands of dollars. It also means not imposing new policies that would further harm Virginia’s housing industry.
Foremost, housing is a quality of life issue, and Virginia’s overall attractiveness to potential investors is based on its overall quality of life. Housing is a part of the answer when someone asks, “Is Virginia a good place to live and raise a family?”
Businesses looking at locating in Virginia or in remaining in Virginia versus beating feet to some other place like Texas or North Carolina want to know that their employees will have access to decent, affordable housing. It is a metric that will affect which employees (employees whose skills are highly valued and who the employer wants to retain) follow the employer moving to Virginia. Indeed, the ability to find good housing may be key to a relocation decision.
A simple reminder comes by way of former National Association of Home Builders (NAHB) President (and Virginian) Gary Garczynski, who states, “Homes are where the new jobs go home to rest at night”
Beyond quality of life and its relationship to economic development, housing is an important component of Virginia’s economy.
The economic impact of housing is important on several levels. At the most basic, housing is a major industry in Virginia that employs tens of thousands of Virginians and generates hundreds of millions in taxes. Yet, when a new development opens, there aren’t ribbon cuttings and praise; though there should be, because those new houses represent jobs and income for Virginia families.
Second, as a major industry, housing affects many other businesses across the Old Dominion. According to the Home Building Association of Virginia (HBAV), over 55 businesses – many of them small, locally-owned businesses – are usually involved in the acquisition, financing and construction of every new home in the Commonwealth. Moreover, construction and development constitute a significant portion of economic activity in Virginia.
Finally, housing is important because commercial growth often follows residential growth. Most local governments love commercial and the tax revenue and consumer choices it generates, but they think they can attract that kind of growth while tightly controlling residential growth. The truth is that business follows rooftops. Retailers are looking for customers. Folks locating office buildings are looking for reasonably-priced homes where their tenants’ employees will live. In other words, you cannot be anti-housing and be pro-business.