The recession has forced builders and developers to reconsider their growth strategies. Some are shifting toward the kinds of affordable housing solutions that John K. McIlwain champions as Senior Resident Fellow/J. Ronald Terwilliger Chair for Housing at the Urban Land Institute (ULI) in Washington. The Terwilliger Center at ULI looks for ways to encourage workforce housing located near jobs, and as part of a ULI project called The City in 2050, McIlwain is examining how housing intersects with the development of infrastructure and long-term sustainable urban and suburban growth. McIlwain also is chairman of the Center for Housing Policy and a past president of the National Housing Conference. He currently serves as a director on a number of boards, including the Community Preservation and Development Corp.
Q: Will affordability outlast the recession?
A: The largest group of potential new buyers is the Echo Boomers, all 76 million of them. They will be in the market for their first homes over the next 10 years, but their ability to buy will be severely constricted. [Plus] the cost of [energy] will grow faster than incomes for years to come. For these and other reasons, the trend to smaller houses in closer-in, more-compact locations will continue to grow.
Q: Where should municipal land-use plans be headed?
A: A thoughtful policy for local jurisdictions would be to look for ways to ease restrictions on compact, mixed-use, and mixed-income development. Miami and Denver are in the process of implementing citywide form-based codes that are intended to promote this kind of development. There is [also] attention being paid in many localities to developing around transit. But it is too soon to know how these initiatives will take shape.
Q: What trends should builders be looking for?
A: Where will [aging Baby Boomers] live, what housing do they want, will they become more urban? Will [Echo Boomers], the most ethnically diverse generation yet in the U.S., see housing as a good long-term investment, given the current collapse and that they will be mobile for years to come?
Learn more about markets featured in this article: Washington, DC, Denver, CO.
