Affordable Housing

Affordable housing is housing which is deemed affordable to those with ahousehold income at or below the median^[1] as rated by the national government or a local government by a recognized housing affordability index. Most of the literature on affordable housing refers to mortgages and a number of forms that exist along a continuum – from emergency homeless shelters, to transitional housing, to non-market rental (also known as social or subsidized housing), to formal and informal rental, indigenous housing, and ending with affordable home ownership

Explain current housing market

Current housing supply

According to a report published in 2021 the Bloomington-Normal housing market was short of demand by over 4,000 housing units. This study neglected was using incomplete data on the demands the expansions at the local Rivian plant. The Bloomington-Normal followed up with their own study using the same formula, but including adjusted Rivian projections, and concluded that the actual number was closer to 7,500 housing units.

https://www.wglt.org/local-news/2023-06-15/bn-housing-supply-gap

Current sales rate

As of June 2023 the number of homes listed on the market had dropped from 456 pre-pandemic to 186. The amount of time a residence stays on the market had declined from 89 days to 42 days. The increase in demand has raised the local house price index 37% between 2021 and 2023.

https://www.wglt.org/local-news/2023-06-15/bn-housing-supply-gap

Current rental market

The U.S. Department of Housing and Urban Development, which administers Section 8 vouchers, set the fair market rent in McLean County for the 2023 fiscal year at: $698 for studio apartments, up from $609 the prior year; $793 for one-bedroom apartments, up from $703; $987 for two-bedroom apartments, up from $870. Increased prices in building materials and labor have been pointed to as one cause for the extreme price hikes.

Effects

There are about 78,000 people living in Bloomington, IL 266 people in Bloomington are homeless and 12% of the people are in or below poverty line, making Bloomington higher than the national average. The main cause of homelessness is the lack of affordability in homes there's other causes like overgrowth, epidemic, inflammation, etc. A few results of this can lead to poverty, family problems, alcohol/drug abuse, etc. this has had to encampments here in Bloomington, IL there is a big encampment with people staying at the parking lot by Home Sweet Homes Ministry (HSHM) where many stay the night to sleep. Many have talked about this situation but not so many have helped. HSHM have looked into adding sanitary precautions like a porta-potties, hand washing stations, and trash binds for the many staying there. An average 861 sq. Ft apartment cost about $1,125 in Bloomington, IL. Most families in Bloomington, IL only make about $47,000 a year. Health care is crucial, a night in the hospital is usually $3,000 a night. This issue has an effect on many because many people don't meet requirements to afford.

Homelessness: health issues- Contribute to homelessness, sometimes, people are born with mental or physical disabilities that make it difficult for them to maintain state housing. For example medical conditions like diabetes can be financially hard, leaving little money for rent. Additionally, physical ailments such as back and shoulder problems can limit Jon opportunities. Another major factor is the lack of affordable housing in Bloomington- with the high demand for low income housing rents keep increasing making it tough for low wage workers to find affordable options. Substance abuse- can lead to homelessness. Many homeless individuals in Bloomington IL struggle with substance abuse as the main cause of unemployment. Salvation Army has rules about alcohol and drugs, some individuals have legal marijuana they can have but still cannot be able to sleep in those shelters due to the sobriety of the rules. Others choose to stay on the streets rather than give up their substances. Food Insecurity- faced by homeless refers to lack of consistent access to enough nutritious food for a healthy life. This condition has short-term and long-term effects on health, education, productivity, and overall well-being.

Problems that exist within the market

The problem with affordable housing is that there is not enough affordable housing available. The reason for this problem is that there is a high demand for housing and there is not enough housing available. This in turn results in property owners raising the prices for their housing which allows them to make a higher profit. But some buyer are unable to afford such high prices which leaves the buyer with a pretty big problem as to how they will come up with some sort of housing.

Current struggles for home buyers

Purchasing a house is a difficult and complex enough process without new or growing difficulties. Home owners are having to struggle with raised credit scores while trying to buy a house (wjbc.com/2022/03/24/local-nonprofit). Another thing to consider would be finding a home that meets the preferences and requirements that the buyer has decided would suit them best. If the buyer is unable to find a home that they either meets their stipulations, then the buyer has to either settle for the next best option or find another place that does meet their needs. But if the buyer is unable to find a home in the area in which their job is, the buyer might have to relocate and find another job. This becomes a problem for McLean County when they start to lose business. If the major businesses like Ferrero, Rivian, and State Farm can’t keep their employees in the area, they might have to consider relocating themselves which puts McLean County in a difficult position as they will lose a lot of business and residents.

Current struggles for renters

One of the biggest problems that most renters are experiencing is that the security deposits can be equivalent to three months of rent. (wjbc.com/2022/03/24/local-nonprofit). Another thing that not only renters, but home buyers are having to deal with is raised credit score requirements (wjbc.com/2022/03/24/local-nonprofit). Renters can also face the struggle of not being able to find a housing unit that meets their needs.

Explain the causes of the problems in the market

Rivian, State Farm, other local industry

Patrick Hoban who is the CEO of the Bloomington-Normal Economic Development Council stated that Rivian was over sixty five hundred jobs while the original projection was five hundred jobs. This in turn has increased the demand for housing and has brought a lot more people into the community (https://www.centralillinoisproud.com/news/local-news/bloomington-approves-new-housing-lots-amid-need/). It has been projected that McLean County will add ten thousand residents to their County population with in the next ten years . The major contributing factor is the growth that is occurring with major businesses (https://www.centralillinoisproud.com/news/local-news/bloomington-approves-new-housing-lots-amid-need/).

There is a plan to build 798 apartments and townhomes near the Rivian Motors location in Bloomington-Normal. This is happening after the Bloomington City Council approved the annexation agreement for the project. This project is stated to represent ten percent of the number of homes needed considering that most of the other projects that have been started to help combat the housing crisis in Bloomington-Normal only cover a much smaller percentage of the need. The location of the project is near the Rivian Motors site for a reason. With the amount of jobs that Rivian requires to run their company, they need a lot of people. This means that they have haired a lot of people which is a big reason why a lot of people are moving to Bloomington-Normal. While Rivian isn’t the only company that requires a lot of man power, their demand for workers is pretty high. This makes sense to have the new housing site near the company as many of the people that will work at Rivian will most likely move there. (https://www.wglt.org/local-news/2023-07-24/bloomington-council-oks-major-housing-development-near-rivian)

Impacts of COVID 19 on housing in Bloomington-Normal

Many landlords experienced a higher than average default rate during the COVID-19 eviction moratorium. As a result, and due to higher demand in the area, many landlords are requiring higher credit scores and income levels before accepting new renters. This has pushed low income renters out of the market even further and restricted their access to housing.

Explain possible solutions and groups working on those solve those problems

Housing Options

The twin city area has temporary housing options ranging from homeless shelters, to rapid rehousing, to public subsidized housing. Those who are homeless, recently lost their home, or are in danger of missing payments due to low income all have numerous options to choose from; though due to the recent increase in demand for assistance waiting lists for all of these resources have lengthened significantly. However with the dedication of local volunteers, enthusiasm and support for helping those in need has increased. According to a local paper "The Pantagraph", a local advocacy group called the 'Stand Up for Justice;' group rallied in front of the Bloomington Center of Performing Arts to bring attention to the homeless and affordable housing crisis the city has. The WJBC reported that even the CEO of Home Sweet Home Ministries took on a leadership role by warning the city government and county governments about a coming and growing housing crisis for the twin cities.

Organizations

There are a multitude of organizations that work towards fixing homelessness and fight for more affordable housing. These include:

Habitat for Humanity: this organization gathers money through fundraising and then uses this money to build homes for many lower income families. These houses are free of charge to the homeowners, and are built by volunteer workers.

Why New Homeowners Should Volunteer for Habitat for Humanity | HGTV

Shown above is a home in the process of being built by volunteer workers.

Home Sweet Home Ministries: HSHM provides resources like clothing, shoes, food, shelter, and resources to help people get back on their feet.

The Salvation Army: Like HSMM, this organization also provides household items, clothing, shoes, meals, shelter, and also provides other resources. These resources may normally be unavailable to the homeless or lower income individuals, but are still just as necessary to them.

Bloomington Housing Authority: BHA provides housing (like Section 8 housing) to low income families, but also aims to make sure these homes are safe and sanitary.

Project Oz: Project Oz does many things, notably steering teens and young people in healthy ways that may not have been possible in their homes and communities. This can help prevent young adults from falling into poverty/putting themselves at risk of becoming homeless, and helps pull people away from this before it's too late.

PATH: PATH's primary focus is crisis response, but they also do quite a bit of "street outreach" to the homeless to help these individuals find what they need and get the help to start fresh.

Bloomington-Normal Community Land Trust: BN-CLT hopes to help with the affordable housing problem in the area. A Community land trust is a organization that “is designed to bring affordable housing without the need for building a new structure”. Mark Adams who is the “steering committee chair” for the Bloomington-Normal CLT said that the project’s main goal is to find properties that already exist and renominate them as affordable housing. They then sell the homes but own them still to allow for control of the price. This can mean from as little as a twenty percent change cut in price to upwards of forty percent cut. For most low-income homeowners, this will be a huge deal(https://www.wglt.org/local-news/2023-09-20/women-to-women-giving-circle-goers-want-affordable-housing-but-obstacles-loom). The McLean County housing market has been a rather ruthless and challenging market as of lately. Due to the high demand and very low supply of affordable housing it seems that it is only getting worse. With many people moving to the Bloomington-Normal due to getting hired at Rivian Motors, State Farm, Bridgestone or any other growing company, many people are left wondering how they will be able to come up with a house or apartment. Luckily though home buyers and renters alike are able to work with Community Land Trusts to help with affording a new abode. The CLT is there to help the people who don’t have the money to compete with the housing market. (https://www.wglt.org/local-news/2023-09-12/group-looks-to-rally-support-for-a-community-land-trust-in-bloomington-normal-aimed-at-housing-affordability)