Missoula In Search Of Solutions As The Housing Market Tightens And Prices Soar

A healthy property market has a five percent vacancy rate, but Missoula’s multi-family home vacancy rate fell below one percent in 2020. However, recent data shows that it softened to 1.25 percent in 2021. Although efforts to solve Missoula’s housing crisis began before the COVID-19 outbreak, city and county officials have prioritized attainable housing this year. This is due to a lagging inventory for residential property and rising prices.

Additionally, the population growth in the region continues to outpace the housing supply while land and building costs increase. Economists suggest these factors could add more stress to the city’s property market in the next coming years. They also say the housing problem could affect the city’s economy. That’s because companies will find it challenging to recruit and retain workers who cannot find, let alone afford, the cost of housing. With these facts in mind, buying your dream home in Missoula can be tricky. Nonetheless, there are a few ideas local officials can implement to solve the housing problem.

Eliminate local government barriers

Addressing the issue of housing affordability is challenging for various reasons. In most cases, property developers choose to build housing units that will sell at a higher price and not below the market rate because they lack government subsidies. Local governments also put barriers that hinder the progress of solving the housing crisis. These include zoning, issuing building permits, lack of renter protection, and other regulations that increase the cost of constructing affordable homes. Removing these regulatory barriers to developing new affordable homes could solve the current housing problem.

Provide legislative support

Renters, especially those with low income, face many financial problems that make it difficult to pay rent. The local government can address this issue by providing affordability assistance. This move will help low-income families maintain a good debt-to-income ratio to ensure rent payments remain low.

Legislative assistance on housing can be subsidies, grants, or homeownership vouchers. Even a small percentage of down payment assistance offered by the government can help move low-income renters to homeownership. To achieve positive outcomes, local officials should leverage the Federal Housing Administration (FHA) to cater to first-time property buyers with low wages. Typically, an FHA mortgage lender requires at least 3.5% of the home’s selling price for a downpayment. In doing so, the FHA ensures individuals with low income or wealth own residential homes with ease.

Adopt innovative building techniques

Embracing modern building techniques is another excellent way of making housing affordable. For example, using off-site framing instead of the conventional stick-built framing technique helps boost productivity while reducing building costs. Off-site framing enables a crew of four builders to complete framing for a 2,600 square feet home within four days. Other innovative ways for speedy constructions are thin joint masonry, raised access flooring, augmented reality, and self-healing concrete.

The demand for housing in Missoula is growing rapidly, outpacing the supply. As a result, finding affordable housing has become a major challenge for renters. However, city officials can solve the housing crisis by implementing a few strategies. This includes reducing government regulations, providing legislative support, and adopting innovative building tactics.