It used to be a rallying cry for antipoverty groups. But the
lack of affordable housing in coastal communities has become so
pronounced that it's drawing a group of advocates from the other
side of the tracks: economic developers.
From the New Jersey shore to southeastern North Carolina to
Florida's Gulf Coast, business leaders say "workforce housing" now
ranks among their top concerns. "We're not in a bad scenario, or a
tight situation; we're in a crisis situation now," says Rick
Marcum, executive director of Opportunity Florida in northwest
Affirms Ben Waldron, executive director of the Monmouth-Ocean
Development Council in New Jersey: "In my circles, in my business
community, workforce housing is really what we're hearing."
Rapidly rising home prices have made affordable housing an issue
throughout much of the country. But the situation is particularly
dramatic in shorefront communities on the East and Gulf Coasts. In
some places, prices have doubled or tripled the already high U.S.
average (nationally, average house prices climbed 12.5% from first
quarter 2004 to first quarter 2005). That's elevated homes beyond
the reach of all but the wealthiest buyers. In southwest Florida's
Marco Island, for example, where lot-covering McMansions are
steadily replacing modest three-bedroom block homes, the average
house goes for $936,855, nearly quadruple the average U.S. price of
With the average price of homes skyrocketing in nearly every
coastal community along the eastern seaboard, "affordable" housing
has come to mean anything notably less than $1 million — and
that's rarely near the beach.
The result: Not only are hotels and restaurants pinched for
workers, but so are schools, police forces, and increasingly
manufacturing, construction, and other local industries. That sets
economic developers on edge.
"You can drive up and down the streets in Apalachicola, Port Saint
Joe, Panama City, any of these cities, and it's Help Wanted, Help
Wanted, Help Wanted," says Marcum, whose eight counties are
experiencing rapid coastal development as well as inland industrial
and corporate growth. "If you can't house a labor force, you can't
The crunch hasn't hit builders and developers in most regions
— yet. Most attribute any difficulties in finding carpenters
and other skilled and unskilled workers to abundant job
opportunities, not to a lack affordable housing. But with
complaints from subcontractors about finding lodging not uncommon,
builders are growing increasingly aware of the problem.
"You have people commuting two hours to get to work for an
eight-hour day on the ladder or up on the roof," says Panama City
developer Richard Turcic, who is seeking incentives from Panama
City to build an affordable housing development.
Solutions are not obvious. Marcum and his colleagues would love to
see developers increase the stock of modest coastal property, but
they're the first to recognize that demand for high-end housing is
so high, and coastal land so scarce and expensive, that it's
unlikely to happen.
Leading Panama City builder Ledman Construction and Development
built about 50 homes last year. Its low-end dwellings start at
$425,000, and the company just completed a $2.9-million home. As
company president Tom Ledman puts it, "I don't see how any
developer can look at today's prices and develop it for affordable
As a result of the troubling trend, more and more community groups
and civic and business leaders are discussing incentives for
developers. Ideas range from relaxed impact fees to weakened
density and environmental restrictions to free infrastructure such
as roads and sidewalks. Marcum, for his part, recently completed a
proposal to create a nonprofit land trust as a vehicle to build at
least 1,000 homes priced around $100,000 in his eight
Some states and municipalities take a more draconian approach of
requiring developers to build affordable homes as part of new
developments that meet certain size criteria. Not surprisingly,
builders tend to oppose this option. But the seemingly simple
solution has a mixed history in one of the first places it was
Following passage of the Coastal Act in 1976, the California
Coastal Commission began requiring all new moderate to large
subdivisions to include at least 25% affordable units in the
coastal counties in the commission's jurisdiction. Initially, says
Sarah Christie, the commission's legislative liaison, the idea
worked. "There was so much money to be made in California real
estate that developers could afford that," she says. But in the
1980s, the affordable housing provision was attacked — not by
developers but by municipalities. The cities' chief complaint? They
weren't getting the tax revenue they deserved from their
communities' most valuable property. After a lengthy battle, the
California legislature repealed the provision.
"Now, of course, coastal cities are screaming and tearing their
hair out," Christie says, "because they don't have enough
— Aaron Hoover
Thunderclouds Over Paradise
Record-setting disasters have yet to dampen
Florida has always been a tough place to live. In the 18th
century, pioneers had to battle black clouds of mosquitoes and
foreboding swamps to drain the peninsula for development. In the
real estate frenzy of the early 19th century, Floridians sank
themselves into the Great Depression three years before the rest of
But always, the allure of paradise overcame the disaster of the
day. And it seems the same is true in the 21st century. University
of Florida demographers this summer released the bleakest study yet
of the aftermath of the 2004 hurricane season. That year, one in
four Floridians evacuated because of a hurricane, said the study,
which was based on a survey of more than 2,000 respondents. One out
of 10 residents had to move out, some for months. And nearly one of
three homes was damaged, destruction so widespread that, a year
later, more than a million Floridians still await repairs.
But as Pensacola residents mopped up from the first wallop of the
'05 season, Hurricane Dennis, the study's most intriguing
conclusion isn't about hurricanes and their wrath. It's about the
intoxication of Florida — and coastal living in general.
Despite the '04 season's manifest hardships, the authors conclude,
there's no sign of an exodus out of the state or a slowdown in the
migration that will soon make Florida the nation's third most
populous state behind California and New York.
"I think last year's hurricane season by itself will have virtually
no impact," says Stan Smith, director of UF's Bureau of Economic
and Business Research, noting that all southeastern states continue
to undergo rapid growth despite the hurricane risk.
It's not that the survey found Floridians ignored the massive
storms. In what should be good news for builders, the study
estimated some 10% of Floridians did structural upgrades to their
homes (some as part of repairs), while 13% say they plan to
strengthen their homes. Another 290,000 residents bought
generators. But only 2% of respondents said they planned to leave
Florida, the study found. If history is any guide, that's unlikely.
Smith's previous study, of Hurricane Andrew's aftermath in
Miami-Dade County, found Florida's worst hurricane in modern
history prompted a loss of only 40,000 residents, all quickly
replaced by newcomers. Andrew struck in 1992, yet the pace of
growth in the '90s exceeded that of the '80s, Smith noted.
After the 2004 hurricane season, one might expect Floridians had
their fill. Not so, states a recent report by University of Florida
demographers that shows few are deterred by the surge of great
storms, such as Hurricane Ivan, which engulfed this Pensacola Beach
It's probably silly to look for a deep psychological explanation
for the surge toward sunshine. "People weigh the risks versus the
advantages to living in an area like that, and they understand
there is a risk," said Brenda Wiens, a research assistant professor
in UF's department of clinical and health psychology.
But with meteorologists predicting active hurricane seasons for the
next two or three decades, a slowdown is at least within the realm
of possibilities. Gary Mormino, a professor of history at the
University of South Florida and author of the just-published Land
of Sunshine, State of Dreams: A Social History of Modern Florida,
notes that in the 1970s, only three hurricanes struck Florida.
Prior to 2004, the state hadn't been hit by three hurricanes in a
single season since 1963. If the forecasters are right …
well, it's just possible that Mormino's label of a "dream" state
may begin to tarnish.
"You add four hurricanes to citrus canker, West Nile fever,
ram-and-rob murders, roofers from hell, Versace, Aileen Wuornos,
hanging chads, and there could be thunderclouds ahead," Mormino
says. "But for right now, I think baby boomers and seniors are
still willing to stake their claim in the sunshine." —