Housing investment must now be looked at like any other type of economic development investment a community may need or desire. Earlier this year the HBA of Michigan hosted eight housing summits across the state to hear directly about the challenges facing its members in each region. Some 250 participants attended and reinforced the fact that the building industry has changed dramatically since its pre-recession era, as has how, and where, housing investment occurs. There is very limited bank lending available for speculative development today. There are increasing regulatory and building material costs. There is a shortage of workers and lots. At the same time, there is growing demand for larger homes that provide higher returns on investment. With these challenges and dynamics in the marketplace, very few new homes are being built at starter home or mid-level price points.
At the same time, many new jobs are being created across the state, driving up demand for all types of housing. Supply is not meeting demand and Realtors report record low inventory of homes for sale in a growing number of markets. Because of economic forces and the aforementioned challenges, the building industry in Michigan cannot respond to
Regions that develop the most efficient practices and court investment will gain housing options for their citizens and grow. Those that maintain the status quo or actually increase burdens will lose out and see their communities passed by.