Yes, In My Backyard: Workforce Housing Key to Sustainable Local Economies

The information contained in this article is not intended as legal advice and may no longer be accurate due to changes in the law. Consult NHMA's legal services or your municipal attorney.

The statewide conversation about the need for more workforce housing appears to be quickly changing. New Hampshire’s town and city leaders who were once pondering “should we” and “could we” when it comes to providing support for the development of workforce housing, are now pivoting to “we need to be.”

Why the change?  As developer Dick Anagnost said at a recent statewide forum on the state’s affordable housing crisis, “I look at it this way: housing brings people, people bring the workforce.”

“Businesses don’t want their employees living an hour away,” noted Carmen Lorentz, the executive director of Lakes Region Community Developers. “We have always been invited to develop in a community because they wanted workforce housing.”

Indeed, more New Hampshire municipalities are finding themselves on offense instead of defense when it comes to workforce housing development. Some may attribute the shift to the severity of the problem itself. New Hampshire’s rental housing market is almost completely full, with a statewide vacancy rate now at below 2% and 1% near the job centers, according to the 2018 Residential Rental Costs Survey conducted annually by the NH Housing Finance Authority. The median gross rent for a 2 bedroom is now $1,296.00 a month, according to the same survey, up 19% in the past 5 years.

Others may attribute the shift in attitude to the communities themselves. School enrollments are down, millennials and young families are renting longer before jumping into homeownership, and local businesses are asking municipalities for help in addressing their workforce shortages. 

The Business and Industry Association has actually focused on the issue of workforce housing for several years. Its recently released 2018 policy priorities notes that New Hampshire’s statewide chamber of commerce “supports efforts that increase the availability and affordability of housing for working people.”

Londonderry is a community that stepped up to its workforce’s needs. Robert Tourigny, executive director of NeighborWorks Southern NH and developer of Whittemore Place, a 78-unit property in Londonderry, observed, “a high percentage of our tenant base in Londonderry work in manufacturing at Freudenburg-NOK Sealing Industries, as well as the Kalwall Corporation and Harvey Building Products. The community understood that we were helping keep these jobs in the region.” 

Even in Portsmouth, a city with some of the highest real-estate costs in the state, the outcry for more affordable housing is turning into action. The Portsmouth Board of Adjustment recently granted the necessary zoning changes to a proposal for 64 units of workforce housing with strong support from the community. 

The Portsmouth proposal comes from the Portsmouth Housing Authority that has expanded its mission to include workforce housing development and has decided to reinvest ownership of a downtown location into providing additional workforce units.

“In a way, we are just giving the community what it asked for in its most recent master plan,” said Craig Welch, the executive director Portsmouth Housing. “There is a significant list of goals listed in the master plan, all calling for just this type of housing and we are ready and willing to respond.”

Robert Tourigny from NeighborWorks agrees that affordable housing developers are now able to provide their expertise and mission focus to communities that are seeing the positive impact of diversifying the housing stock in their communities. “Community conversations about housing stock, workforce needs, etc. are very important before a project is proposed,” said Tourigny. “Once the community wants a project, the approvals come quickly.”

Marty Chapman, executive director of The Housing Partnership, another New Hampshire nonprofit housing developer, attributes some of the change at the community level to the quality of projects. “The long-term effect - we hope - is that the quality and stability of the projects that The Housing Partnership and other capable workforce housing developers have built over time will help move the needle incrementally on expanding local zoning codes to meet the higher-than-ever demand for workforce housing.”

The Housing Parternship has been working closely with the city of Dover. After the success of one development, another one followed. “Towns who have not yet approved a workforce housing project can understandably be quite apprehensive about the outcome,” noted Chapman. “Whereas towns who have approved previous projects tend to invoke the perceived success or failure of earlier developments in evaluating a new proposal.”

Perhaps the shift to “Yes in My Backyard” is mostly due to the economic benefits affordable housing development can provide to a given community. Housing is the kind of investment that leaves a working economy in its wake. Carmen Lorentz shared, “We found out that the tenants living in our developments work at over 125 businesses in the Lakes Region. Once community leaders have that kind of data, they are really open to working with us.”

The push for more affordable housing is also coming from communities interested in supporting an arts-based economy. “Affordable housing is a big way to contribute to a vibrant arts scene,” said Russ Grazier, CEO of the Portsmouth Music and Arts Center. “Historically, artists will seek out more affordable places and then play a significant role in revitalizing economies. Investing in local artists and musicians also keeps the economic benefits local and sustainable. It’s a win-win all around.”

Adding to a stock of healthy home options is also a driving force behind the demand for new rental home development. The tight market has driven some families into substandard housing stock raising growing concerns around childhood lead poisoning and other home health hazards. Lakes Region Community Developers have made healthy homes a focus including a social media campaign, noting that adults who live in healthy homes are more productive at work and children are more successful at school.

Finally, since the millennial generation is moving and shifting economies faster than any generation before, it is not surprising to learn that they are shifting the housing landscape as well. Governor Sununu’s Millennial Advisory Council listed housing as its first priority in its recently released 22-page report, urging policy makers to take steps to encourage the development of more affordable housing options for young people and young families.

So, has the confluence of generational, economic, workforce, health, arts and community demands completely changed how municipalities view all affordable housing proposals? Not quite. “We still hear from communities that they feel they have done their fair share,” said Marty Chapman.

However, the tide has undeniably turned and examples of success are now more prevalent than ever before. “Housing Action NH members are sensing the shifting landscape and are well prepared to respond to local housing needs,” said Tom DeRosa, engagement and communications manager for the statewide coalition dedicated to affordable housing. “Now we just need to make sure we have the policies and resources in place to help them respond to market demand.”

Elissa Margolin serves as Director of Housing Action NH, a statewide coalition of 80 organizations and businesses united around affordable housing policy.  Elissa may be reached by email at elissa@housingactionnh.org.