For teachers and nurses in American cities, finding affordable housing is becoming increasingly difficult. A study conducted in 2015 found that millennials are one of the housing problem’s biggest victims in American cities. While cities are coming up with different schemes to target housing problems, Denver has found another remedy to providing affordable housing for mid- to low-income teachers and nurses. The city is commissioning a project to house key workers, such as teachers and nurses, in high-end housing by subsidizing rent through a new plan called LIVE Denver.
With low wages and a high turnover rate, employers in Denver are finding it difficult to retain their employees. Key workers are often caught in between choosing long commutes or financial instability to keep their jobs, which is only exacerbated when housing costs them a sizeable percentage of their income. In almost a third of coastal cities, teachers and nurses spend more than 30 percent of their income on housing regardless of teaching experience. In an attempt to expand affordable housing to other stakeholders in Denver, the city is working to subsidize luxury housing for teachers and nurses through a plan called LIVE Denver. The plan targets workers making 40 to 80 percent of average area income or $23,520 to $47,040 annually for individuals and $33,560 to $67,120 annually for families of four.
Currently, 13,000 key workers in the categories that LIVE Denver’s plan targets pay more than 50 percent of their income on housing. And while 16,000 housing units remain vacant in Denver, the majority of occupied housing units are in the city’s high-end market. By placing lower income individuals and families in high-end housing while subsidizing their rent, LIVE Denver aims to partially alleviate the impact of the housing crisis on this community. The city plans to pay $500 in subsidies for individuals and $900 for families, which will result in qualifying residents paying close to 35 percent of their income as opposed to the 50 percent they currently pay.
Denver’s problem with affordable housing, which is rooted in an influx of new residents and a wave of gentrification, is similar to that of many major American cities. The discrepancy between wages and housing prices lies in the increase in housing prices, which jumped by nine percent in 2017 while wages only increased by two to three percent. According to LIVE Denver’s website, the city cannot adjust wages to the increase in housing prices. The website goes on to say: “But we can work with others to create opportunities for employers to directly invest in providing housing affordability for its employees.”
The plan is in part funded by local companies and foundations like the Denver Housing Authority and Downtown Denver Partnership Inc.. As a start, about 100 out of the total 400 housing units are already being adjusted to the plan. To ensure LIVE Denver does not fail, the city plans to monitor landlords so that rent doesn’t increase disproportionately in the face of subsidies.
Other American cities like New York and San Francisco are facing similar challenges with affordable housing. In the Big Apple, there were approximately 60,000 vacant housing units as of last year, a sharp increase of almost 20,000 housing units since 2012. Some cities have begun developing “inclusionary zones” and incentivizing construction companies to build larger housing buildings at lower costs. The question is whether or not the cities working towards developing affordable housing for their residents can sustain their projects to ensure lower-income residents do not need to choose between financial stability and their jobs.