Transforming the blueprint for housing development in Colorado

BY FREDA MIKLIN
GOVERNMENTAL REPORTER

Evelyn Lim is a former federal housing official.

The Common Sense Institute (CSI) is a non-partisan issue-driven non-profit organization of local business leaders that brings together experts of varied backgrounds to support Colorado’s economic vitality through sound fiscal and economic research. On June 25, CSI president Kristin Strohm presented CSI’s two 2021 Terry J. Stevinson Fellows, who summarized their research on the topic of what to do about the severe housing shortage in Colorado. 

Peter LiFari is a private industry housing expert.

Evelyn Lim, director of policy and research at the American Cornerstone Institute and a former U.S. Department of Housing and Urban Development regional administrator, collaborated with Peter LiFari, executive director of Maiker Housing Partners, to identify solutions to the lack of available attainable housing for average Coloradans. They made it clear that if this problem is not addressed effectively and comprehensively, the state’s economy will not be able to continue growing and will eventually decline.

This graph illustrates the comparative housing deficits in selected counties. Arapahoe County’s problem is the highest, by a wide margin.

According to the Denver Metro Association of Realtors, Lim shared, “There was a 29 percent increase in the price of single-family homes in metro Denver last year.” LiFari added that, every year since 2008, an average of 25,682 new homes have been built while almost 78,000 people came to live in Colorado. Today, according to a report from the Federal Home Loan Mortgage Corporation (Freddie Mac), Lim said, “Colorado is the fourth worst place in the country for housing shortages.” People are still moving here. The result is that we “need 54,190 new housing starts annually for the next five years” to meet the state’s needs.

This diagram outlines a plan to address the state’s 175,000 housing unit shortage with modular housing.

In Arapahoe County alone, CSI’s report shows, the average yearly population increase from 2008 to 2019 was 9,382 new people, while the average annual number of new housing units built was 2,305. In Denver, there were 4,957 new houses built during each of the years from 2008 to 2019 as 12,952 new people arrived every year to live in them. And so on.

“Instead of just looking at demand-side solutions, we’re asking our fellow Coloradans to look at the delivery model with us and where we can innovate,” LiFari offered. It will require transformational changes in attitude and everyone working together to create force multipliers. Some of LiFari and Lim’s guiding principles for housing development include:

  • Embrace growth – a vibrant, growing economy, supported by a healthy housing supply, benefits us all; increasing our tax base, sustaining our communities’ needs.
  • Accept the reality that affordable development needs financial support.
  • Embrace new building methodologies to increase productivity and growth.
This graph illustrates how the housing shortage in Colorado developed over the past two decades.

The researchers pointed to the fact that construction is the last unmodernized industry. The product the researchers envision is high-quality modular housing produced offsite. They emphasized that the quality of today’s modular housing makes it practically undistinguishable from homes built onsite once they are installed. New modular homes are designed with cutting edge technology and are energy efficient, in addition to being much less costly due to the significant difference in manual labor compared to traditional construction.

As of June 2021, the Denver Metro Association of Realtors reported that the average price for a single-family, detached home in the greater Denver area hit just over $700,000. Statewide, the most recent information from the Colorado Association of Realtors, as of April 2021, saw the median sales price for a home rise to just over $500,000. 

In comparison, according to modulartoday.com, “The median (modular) home price in Colorado is $308,100. Colorado home owners have seen their home value increase an average of 10.9% over the past year and real estate experts are planning it will rise 3.8% within the next year. The median list price per square foot in Colorado is $199. The median price of homes currently listed in Colorado is $367,900…The average home prices for: Denver $353,300, Lakewood $339,800, Fort Collins $333,500, Westminster $302,400, Thornton $296,300, Aurora $264,300, Colorado Springs $235,000, Grand Junction $195,400, Pueblo $130,600.”

Lim and LiFari recommend starting a supported housing plan with money from the federal American Rescue Act. Their other recommendations include: 

  • The state legislature should act to eliminate cities’ ability to adopt no-growth ordinances because they are “the biggest threat to affordable housing in Colorado.”
  • Use available public property to develop mixed-use affordable housing.
  • Prioritize homes over parking spaces and create greater “use by right” zoning overlays.
  • Allow for accessory dwelling units.
  • Implement a uniform statewide building code.
  • Expand pathways to careers in construction.
This is the kitchen of a modular home available in Colorado.

They emphasized, “All the tools in the world won’t make a difference if we don’t first change our entire mindset when it comes to housing development and growth.” Lim and LiFari stressed that one of the biggest impediments to solving the housing crisis is some cities’ NIMBY (Not In My Back Yard) anti-growth attitude. Colorado’s housing needs don’t stop or start at municipal boundaries. It is everyone’s problem and can only be solved if all the residents and our state and local governments take ownership of it as a community challenge.

This is the exterior of a modular home available in Colorado.

The fellowships that supported Lim’s and LiFari’s work honor Terry J. Stevinson, who was a founding member of CSI. These awards are presently annually “to research a critical public policy issue facing Colorado and present achievable solutions. This year’s fellowship research topic was housing affordability.” The full, outside-the-box, 60-page report is available at www.commonsenseinstituteco.org. One of its fundamental premises is, “Housing is a human right… Housing is infrastructure, Housing is healthcare, Housing is wealth, Housing is opportunity.” The report includes a quote from a recently published study by highly regarded local polling enterprise Magellan Strategies’ which found that, “74 percent of Colorado voters consider affordable housing to be a problem in their community.”

The event was held both live and virtually. Attending in person and paying close attention were local elected officials Centennial Mayor Stephanie Piko, Lone Tree Mayor Jackie Millet, Douglas County Commissioner Lora Thomas and Aurora City Councilmember Curtis Gardner. Attending virtually were State Sen. Julie Gonzales from Denver, Centennial City Councilmember Don Sheehan and Parker Mayor Jeff Toborg.

fmiklin.villager@gmail.com

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