By Patrick O’Grady | Daily Independent
Scottsdale has a shortage of affordable and workforce housing, at least according to a study presented to the city council on Monday.
A report from consulting firm Matrix, discussed during a council workshop on Nov. 14, found there is a shortage of 16,321 housing units across three tiers of affordability in Scottsdale and another 2,836 shortage of workforce housing units.
What’s causing those shortages are a mix of higher prices, market impacts and even short-term rentals, according to the study.
Scottsdale has 5,921 owner-occupied homes in its current housing stock that are considered affordable, and another 7,950 considered workforce housing, according to Christian Caron, senior research analyst for Matrix Design Group’s Phoenix office.
While it lacks affordable and workforce housing, Scottsdale has an abundance of market rate and luxury homes, Caron said.
“In an ideal world, owner demand and supply would be very close and there would be a small gap at each income tier, but that’s not what you see here,” he said.
Affordable housing is defined as units that are available to people who have between zero and 80% of the area median income. Workforce housing is affordable for those between 80% and 100% of the median income.
Scottsdale has about 33,000 households that can only afford affordable or workforce homes, and the median income for Scottsdale is $111,317.
Although many homeowners are stretching budgets to stay in their homes, most can keep their payments within 30% of their income. The 2020 median income of $111,317 is the measurement.
Scottsdale undertook the housing examination in September 2021, and hired Matrix for the study in December 2021. The attempt was to quantify what Scottsdale has for housing stock and what it may need.
Of homes owned in Scottsdale, 83% are market rate or luxury homes, meaning those who make at least the median income for market rate and double that income for luxury can afford these homes.
“What this means is that 83% of your homes that are owned in Scottsdale are not affordable for people earning less than 120% of the median income in the Phoenix metro area,” Caron said. “What this implies is you have a severe shortage of workforce and affordable housing.”
The rental market for houses is a different story than the owner-occupied market in Scottsdale. The city’s rental stock is in the affordable and workforce range. There’s a surplus of 9,000 units for the 50% to 80% median income range.
However, Scottsdale is short on market rate and luxury rentals. It is also short on rental homes for those who make 30% or less than the median regional income.
Caron said most likely there are people who are either stretching their budgets or renting less than they can afford as one reason why rental housing in those areas is meeting demand.
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