If first responders, veterans, teachers, nurses, plumbers, electricians, restaurant, and hotel workers cannot afford a home in their own community, there is an affordable housing problem. If young professionals and families cannot afford a starter home, there is an affordable housing problem.
These were the issues raised at the Western Carolina University (WCU) Housing Summit held in June where 90 attendees (pictured above) gathered to tackle the problems, including officials representing Haywood, Jackson, and Cherokee counties, as well as the towns of Murphy, Highlands, Forest Hills, and Franklin.
One aspect everyone agreed to was that affordable housing is an issue with far reaching impact across all socioeconomic levels.
“Every day I hear from Franklin’s business owners who can’t attract workers, including high paid professionals, in part because of Franklin’s housing inventory shortage and an affordability gap,” said Stacy Guffey, vice mayor for the Town of Franklin, who was in attendance. “I’m committed to finding solutions and working with our town government to immediately explore the many ideas offered here.”
By definition, an individual is “housing burdened” if they spend more than 30% of their income for housing costs, explained Bob Jessup, a policy advisor with Sanford Houlshouser who is working with communities to solve these problems.
And, while housing is a regular topic across all Western North Carolina (WNC) communities, the issue is not confined to the mountains. Statewide, 28% of home owners and 48% of renters are housing burdened, noted Sara Vanlear, project manager for the University of North Carolina’s Development Finance Initiative.
“In most counties, between 30% and 60% of renters are housing burdened,” she said. “And nearly a third of all renters in the seven counties west of Asheville are cost burdened.”
When it comes to first-time home buyers, conference host Rich Price, WCU’s chief marketer and strategic partnerships officer, pointed out that high prices, high interest rates, and fewer affordable listings make owning a house nearly impossible for families, college graduates, and workers across the board.
Nationally, the number of first-time homebuyers is 50% below the 20-year historical norm, according to The National Association of Realtors. And through May, the U.S. is on track to sell the lowest number of homes overall since 1995.
Starter home option out of reach
According to Realtor.com, the median listing price in Macon County was $599,000 in May. Meanwhile, companies like Zillow and Home.com share that affordable starter homes cost between $150,000 and $300,000.
Unfortunately, failing to achieve the “American Dream” is not the only issue.
“Poor housing conditions can lead to quantitative illnesses like asthma and mental health struggles. People are choosing between housing and things like food, healthcare, or savings,” said Price. “These issues are real and they impact families and businesses.”
For towns and counties, housing is a key factor in a community’s economic development. The ability to recruit new companies and create new jobs is threatened by housing shortages.
One example mentioned at the event was the June 12 JetZero announcement in Greensboro, N.C., of a new $4.7 billion factory expected to create 14,000 new jobs there.
“The first phone call that folks make after they announce those (new) jobs is: ‘Where are they going to live? How do I get housing here?’” said Scott Farmer, executive director, North Carolina Housing Finance Agency.
Sarah Grymes, Dogwood Health Trust’s director of impact investing, offered that North Carolina faces a statewide housing shortage of 750,000 units over the next five years.
Rita Salain, another Franklin town council member attending the conference, wants Macon County and Franklin to work together. “Nothing happens quickly, but for anything to happen at all, we must work together with a plan of action,” she said. “We need to figure out how to attract developers and determine what we can do to make the work of developing affordable housing feasible.”
To achieve that, she would like to see a workgroup made up of nonprofits, government, business leaders, and others to begin identifying resources and solutions.
Aid from the ‘Big Beautiful Bill’
The recent federal omnibus spending bill touted by the Trump Administration could help Franklin and Macon County. According to a recent The Wall Street Journal assessment, developers can deduct 100% of many property-improvement expenses, while it also provides a 12% expansion of the Low-Income Housing Credit, which has funded the development of 50,000 new affordable housing units a year.
With Franklin being home to Macon County’s only “Opportunity Zone,” the Trump bill makes tax-deferred investments a permanent part of the tax code for pass-through entities, like LLCs, which own or manage apartment buildings with five or more units (technically considered commercial real estate).
For local governments, Jessup said the first step is to become “easy to deal with” by expediting low or moderate-income housing developments. He indicated that what developers desire most is not government money or tax incentives, it is officials actually sticking to commitments and schedules.
“Time and uncertainty cost money,” he said. “Be aware and sensitive to that.” Every day a developer waits for a call from a government agency means delayed construction and added costs – as well as homes not owned by local families.
As for Franklin, Jessup believes one option for growth are the buildings lining Main Street. In downtown, many of the Main Street buildings appear to have empty upper floors. Opportunities for improvement include tax breaks through landmark status for old buildings, grants and incentives for residential conversions, and employer-assisted housing programs.
“Many places might think our voters will never go for that,” said Jessup. “But the track record of those types of referendum shows differently. Voters will vote to help because affordable housing issues touch everybody.”
Other options suggested at the summit include:
- Survey government-owned assets, offer underutilized properties for housing.
- Use a portion of water and sewer funds to offer developers 0% loans. For example, Morganton, N.C., only requires approved housing developers to pay back 50% of the loan. Over time, the city recoups the remainder of the loan from the property owners.
- Offer development assistance to market-rate housing projects in return for the inclusion of affordable housing options in the same development.
- Tap government funded rent-to-own options.
- Allow a single-family home conversion to a duplex or triplex; permit backyard cottages in residential areas; and, remove lot and dwelling size rules, if necessary.
Empty dwellings an opportunity
One problem many WNC communities face are dilapidated or empty houses in town. Panelists acknowledged Sylva’s efforts to solve that problem; local governments could offer repair programs and tax assistance to owners willing to preserve existing homes and offer affordable housing.
Both Guffey and Salain agreed that funding mechanisms to help make existing homes safe and livable are as important as increasing new inventory.