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Housing shortages across Michigan alarming local leaders - Michigan survey

September 14, 2023

Michigan local officials are reporting alarm at the lack of housing options across the state. Those concerns include single-family homes and multi-family units, and cut across affordable, entry-level and mid-level housing availability. 

The results of the 2023 Michigan Public Policy Survey (MPPS) exhibited nearly 50% more concerned respondents compared to similar questions asked in the 2017 wave.

The MPPS report shows that the concern is truly state-wide. “In 2017, concerns over lack of single-family housing were particularly high among officials from ‘mostly urban’ communities. Now, these concerns have increased and spread among local leaders of all kinds, from those in rural (40%) and mostly rural (44%) communities, to those from mostly urban (37%) and urban (41%) jurisdictions.”

Regionally, officials from cities, villages, and townships in the Upper Peninsula (UP) are the most likely to express concern about insufficient single-family housing (59%) and multi-family housing (61%) in their jurisdictions.

“We see from the responses that this is an issue being confronted in communities of all types, all over Michigan. Some of the shortage can be attributed to shifting demand during and after the COVID-19 pandemic, or to supply chain interruptions in the construction industry. Yet only 24% of local leaders say they have a sufficient construction workforce in their areas, so this is an on-going issue,” commented Debra Horner, MPPS senior program manager. 

When considering how to address the shortage, relatively few local leaders believe that their policies or zoning ordinances hindered local construction. The state government has initiated a number of programs to expand incentives to build more affordable housing across the state, with short-term goals outlined in Michigan’s first Statewide Housing Plan include building or rehabilitating 75,000 housing units within the next five years. 

Tom Ivacko, executive director at the Center for Local, State, and Urban Policy (CLOSUP) at the University of Michigan’s Ford School of Public Policy, which administers the MPPS, says the housing shortage is affecting other statewide policy goals. “These challenges have the potential to disrupt Michigan’s current economic development strategy and emerging efforts to increase the state’s population. The Michigan Economic Development Corporation has engaged in a national campaign to attract new industry and business, highlighting the state as an ideal location for numerous industries. Yet Michigan businesses are already communicating to state officials that they are hindered by limited housing options for workers and are calling on state and federal subsidies as a remedy.”

Looking at potential solutions, the survey found that many local communities don’t have organizations, local employers, or business groups interested in helping develop affordable housing or in subsidizing workforce housing. As well, a majority of local leaders are unfamiliar with several new housing programs recently launched by the State of Michigan. 

The report states that this majority is likely driven by the large number of small, rural local governments that generally provide few types of services, and are not likely active in local housing support efforts. The MPPS surveyed leaders regarding five state housing programs and found that, among local leaders statewide, 27% or fewer are familiar with any of the five, while another 14-16% are unsure. For example, a third of local leaders report being completely unfamiliar with the Michigan Homeowner Assistance Fund (MIHAF), which was established in 2021 under the American Rescue Plan Act (ARPA) to provide funds to homeowners to mitigate financial hardships associated with the COVID pandemic, while 42% are completely unfamiliar with the Michigan Statewide Housing Plan introduced by the state government in 2022.

That support is critical, the report concludes. “As national and statewide housing costs increase alongside other inflationary pressures, addressing local housing shortages is crucial to support local economic and community development programs, to grow the local workforce by drawing new owners and renters to the state and by creating new construction jobs, and to increase local government revenue.”

The MPPS is an ongoing census survey of all 1,856 general purpose local governments in Michigan conducted since 2009 by the Center for Local, State, and Urban Policy (CLOSUP). Respondents for the Spring 2023 wave of the MPPS include county administrators, board chairs, and clerks; city mayors, managers, and clerks; village presidents, managers, and clerks; and township supervisors, managers, and clerks from 1,307 jurisdictions across the state.