Better Housing Options Will Attract Millennials To Connecticut
By Sean Ghio, Hartford Courant
The Commission on Fiscal Stability and Economic Growth is nearing completion of its yeoman’s search for savings, income, strategies and opportunities to right the state’s fiscal ship.
Labor pool. Pension costs. Tax policy. Education aid. It’s clear they will give the legislature serious policy recommendations to consider. I spoke before the commission last Friday and asked that they also consider policies that can invigorate a linchpin of our economy: housing ...
- that could keep millennials in Connecticut and attract more.
- that could prop up property tax bases and bring more revenue to municipalities.
- that could put the lagging construction sector to work.
- that could provide more households with more spending money and, as a result, leave the state with more sales tax revenue.
Gov. Dannel P. Malloy gets it. He proposed Wednesday to nudge more towns to create more housing options because so few have the homes workers and young families need. And the Partnership for Strong Communities just-released Housing Data Profiles make clear how Connecticut’s too-limited housing supply is impeding economic growth — and how changes can spark expansion.
How? Let’s start with millennials.
As Connecticut strives to attract talented young millennials, we must have homes that meet their needs and are affordably priced. If we do, many millennials — including 2 million now living in cramped-yet-still-unaffordable New York City (and entering their marrying, home-buying years) will seriously consider living in Connecticut, as their baby boomer parents did. They can work here or commute to jobs in NYC.
Then there are the millennials already here. While about 30 percent nationwide are living with their parents, the proportion in Connecticut is 42 percent — second highest in the nation and 9 points higher than in 2005.
An affordable place would spur many to move out and buy furniture and kitchenware that will also bring more sales tax and other revenue.
Affordable homes in Connecticut can attract or keep millennials near families and friends just as they are putting down roots. But the housing options they want, for this stage of their lives, must be near transit, shopping, services and cool, denser, diverse town centers or station areas.
By allowing creation of those smaller, denser, more affordable, transit-proximate homes near services, towns would be giving the market what it values. Grand lists — and property tax revenue — would grow, a welcome change from the fiscally dangerous flat or falling grand lists (dominated by low-demand, single-family homes) suffered by 152 of 169 municipalities from 2008 through 2016.
In housing, Connecticut’s recent 4 percent third quarter growth spurt conspicuously left builders behind. But repeated research has shown new housing development creates short- and long-term jobs, business income ripple effects, and sales and property tax revenue.
Moreover, building more rentals, condos and starter homes in more towns would give more low- and moderate-income households more choices of communities that can provide children and parents with more individual opportunity: access to schools, jobs and training. That will help reduce poverty, segregation and the cost of government, and put more households on the tax rolls.
Finally, and perhaps most important, more housing supply would lower Connecticut’s economy-crushing sixth highest median monthly housing costs. High demand and too little supply has left at least 40 percent of renters in 117 municipalities and 30 percent of homeowners in 98 municipalities spending more than 30 percent of their income on housing. With less income left for food, clothing and other necessities, that’s bad for them, terrible for local merchants and stifling for the state’s economy and sales tax coffers.
Building permit totals and other measures — most recently a study by BuildZoom, an online resource for the construction industry — show Connecticut is among the 10 markets that have built the fewest homes since 2000.
The demand is there. The supply isn’t.
Towns can help themselves, and all the state’s taxpayers, by building more of the homes we need. Gov. Malloy obviously agrees.
As for the Commission on Fiscal Stability and Economic Growth, its members have a tough job. Reinventing Connecticut's housing policies will complement the economic growth policies they are considering. Rewarding towns that zone for and help create new homes can contribute to the fiscal stability and economic growth the commissioners — and all of us — want for our state.
Sean Ghio is policy director for the Partnership for Strong Communities, a statewide housing policy organization