Housing official: Henrico needs 12,000 more affordable rental units

The gap between rising housing costs and income levels has increased significantly since 2017, and the Richmond region has had the highest rent increase in Virginia over the last five years, more than Northern Virginia and D.C, Partnership for Housing Affordability Executive Director Jovan Burton told Henrico’s board of supervisors July 11.

In 2017, significantly more people met the income threshold to afford the average home in the region than in 2022. Richmond has seen more than an 80% price increase in single family homes since 2017, while Henrico has witnessed a 56% increase.

The workforce as a whole is being affected by this increased gap, Burton explained, not just select jobs.

Many households are spending between 30% and 50% of their income on housing costs, but Burton defined “affordability” as spending 30% or less of one’s income on housing.

In addition, he attributed the region's rent increases to the competitive housing environment created as a result of people moving to the region from other states or from larger metropolitan areas.

“You're competing with people who have higher incomes.They're moving from other areas,” Burton said, “It makes it that much tougher, and the market with limited supply, prices are going to continue to increase.”

Since 2020, nearly 4,400 affordable rental units have been added to the region, but Burton noted that because more than 1,600 affordable units have been lost, the net change was only a gain of about 2,700. That’s because once rental contracts expire on affordable housing units (typically after 15 to 30 years, according to Burton), property owners don’t have to maintain “affordable” prices and can convert to market rate instead.

Burton explained that some localities throughout Virginia have taken steps to make zoning changes that will accommodate those who are slightly above the threshold for housing assistance programs, but who don’t make enough to withstand the competitive market – “the missing middle.” Jurisdictions can offer tax abatements, fee waivers and upfront investment as incentives to developers to make units accessible for a variety of income levels, Burton explained.

"Broadly, those changes could mean more commercial and residential corridors that allow for by-right multifamily housing, townhomes, duplexes, etc.,” Burton said, describing property that is already zoned for such usage. “There’s a rental shortage in Henrico of about 12,000 units for households earning below 80% Area Median Income (roughly $78,070 for a household of three) – jobs that are reflective of the bulk of our workforce.”

The changes also could lead to more mixed-use developments that include residential and commercial components, Burton said, such as those at Regency and Libbie Mill (though he described those as being unaffordable for most households).

Only about 8% of the county’s land area is currently zoned to allow multifamily development by-right, Burton said. In addition, the Richmond region is gaining five new senior households to the region every day, a trend that will continue until 2040, said Burton, who called home repairs for the senior population “a really critical portion of this issue.”

Another trend indicates that more young adults have moved out of their parents’ homes to live with a roommate, non-relative or partner in the last four years.

Burton emphasized the nonprofit's goal of working with the business and corporate community to create a “regional menu of action items.”

“We have a policy committee and we're working closely with jurisdictions across the region,” Burton said.

Partnership for Housing Affordability’s housing resource line offers citizens who are new to the area a helpline that they can call to learn about rental assistance or other resources that they could qualify for.

Studying the live data from the nonprofit’s resource line (804-422-5061) highlights areas in which housing needs are the most concentrated, explained Burton. During the first six months of the year, the hotline received 135 calls from the 23231 ZIP code in Eastern Henrico and the same number from the 23227 ZIP code in Northern Henrico. The third-highest number of calls (100) came from the 23228 ZIP Code in the Lakeside area, while the 23294 ZIP Code in the Near West End was fourth, producing 91 calls.

“This is a really unique opportunity to look at real time, live data of what's happening on the ground in Henrico when it comes to housing,” he said.

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For details, visit https://pharva.com/housing-hotline/