Like many other regions of the United States, West Michigan is still being affected by the great recession of 2008. Michigan’s housing market has improved from its low point almost a decade ago, however there are still market variations across the state. MSHDA’s (Michigan State Housing Development Authority) Statewide Housing Needs Assessment explains that the recovery of the housing market and the residential construction industry has not been consistent across Michigan’s landscape. Some areas are continuing to lag in recovery, leaving the housing market in need of alternative options.
This is where multifamily developments come into play.
What are multifamily developments?
According to Home for All SMC, “Multifamily housing is characterized by multiple units in a single building or connected shared walls.” Apartments and condos are classified as multifamily developments. This type of development is helpful to low-income families, families living in high-income areas, and as a low-pressure option for those in need.
Economic Benefits
The Grand Rapids Chamber writes that, “Kent county is a leader in population and job growth. [Its] success leads to new challenges, including increasing concerns over housing availability and attainability. The data shows that housing supply has not kept pace with our growth, creating significant upward pressure on housing costs.” Due to West Michigan’s success and growth, there are also new housing issues to combat. Multifamily developments are needed here now more than ever.
Multifamily developments provide adequate housing for a growing job market. MSHDA reports that the demand for housing, in addition to being related to growth in households and population, is also influenced by economic factors like employment growth. In areas where job counts are rising, local housing markets are seeing an increased demand for new living situations. On the other end of this, regions that lose jobs also tend to lose population as people move away to seek other job opportunities. An increase in jobs is a positive factor for growing areas, but it also brings the issue of increased housing needs.
Multifamily developments offer attainable housing situations and provide more efficient use of land over single-family development types. According to Home for All SMC, these developments can be built in many different heights, densities, sizes, and styles to compliment the surrounding neighborhoods, keeping different housing options desirable. These developments range from entirely attainable to mixed-income, and can offer different unit sizes, child-friendly amenities, and communal gathering spaces. Home for All’s article explains, “As demographics and consumer preferences shift, demand has grown for walkable communities with a mix of uses, but this type of development is undersupplied.” This housing need has been referred to as the “missing middle,” meaning there are few options between single-family detached housing and high-rise apartments.
Rising Demand
Marketplace’s article on multifamily developments references the U.S. Commerce Department’s Monthly New Residential Construction statistics that were released this month stating the number of new home construction projects rose last month. They go on to say the gain was entirely down to multi-unit construction projects like apartments and condo buildings. While there is still a high demand for single-family homes, there is also a rising demand for rental units and multifamily units. MSHDA’s Statewide Housing Needs Assessment says, “The way that demand, supply, and pricing relate to each other determine the parameters of the housing market in Michigan.”
During the pandemic, there was an increase in families leaving cities to live in suburban outskirts. This shift not only brought prices in suburbs up, but increased the price of city living as well. The increase in the cost of living in outlying areas has given an incentive to live in apartments in the city once again. John Kirk who is managing director of Embrey Partners, a multifamily development company based in San Antonio said, “Even though renting is getting more expensive, it still beats buying for many people. You know, people need a place to live.” There are many factors to buying a home including the process, down payment, maintenance, and more which often make it a more challenging living situation for many families to pursue. This is another angle to consider when looking at the demand for multifamily developments.
Multifamily developments are an increasingly helpful housing choice to those who are looking for another option rather than the typical suburban home or pricey skyrise. These developments are in a higher demand for builders and are a relevant structure in the construction industry. Single-family homes aren’t the only high demand build on the market currently as these multi-unit dwelling spaces are an attractive choice to those who need something less expensive, less permanent, and more flexible.
When looking for your next home, be on the lookout for multifamily developments going up in your area— it could be the right fit for you.
When you see multifamily developments going up in your city, know they are helping aid the growing job industry, housing those in need, and are giving another option to the housing market. West Michigan has seen immense growth in the job market, as well as the need for housing. Multifamily developments are a great addition to this region as we continue to foster growth and meet the housing needs. These buildings are helping to finally close the gap in the difficult housing market and remaining impacts of the great recession.
Multifamily developments — a positive building of our future. Curious about other ways we can work together? Let us know here.