News Summary
Grand Rapids and Kent County are in urgent need of 34,000 new homes and rental units by 2029 to meet rising demand. A study reveals that 13,232 of these units are necessary within the city itself, with a significant focus on rental properties. The report highlights affordability challenges, particularly affecting households earning between 51% and 80% of the area median income. As home prices increase and rental costs remain high, government subsidies are crucial to help lower-income residents. The findings prompt calls for strategic housing production in the region.
Grand Rapids is facing an urgent housing crisis, with a new study indicating that nearly 34,000 new homes and rental units are needed in Kent County by 2029 to meet growing demand. Conducted by Bowen National Research for Housing Kent, the study highlights the necessity for diverse housing options to accommodate the varied income levels across the region.
The report estimates that a total of 33,914 housing units will be required in the county, slightly down from a previous projection which called for 34,699 units by 2027. Within the city of Grand Rapids specifically, 13,232 housing units are necessary to satisfy the demand, with a significant portion—53%—anticipated to be for rental properties.
In recent years, there has been a 12% decline in the demand for rental units, attributed to an increase in the production of such units. Despite this dip, the most pressing need remains among households earning between 51% and 80% of Kent County’s Area Median Income (AMI), which translates to an income range of approximately $53,201 to $85,120 annually for a family of four. To maintain rental costs at 30% of these households’ monthly income, government subsidies are essential.
Previous assessments reported a stark shift in demand, with earlier findings showing a higher need for rentals among individuals earning above $107,401 annually. The findings indicate a growing trend of affordability challenges across different income brackets.
The need for homeownership has seen a remarkable spike, particularly in Grand Rapids, where about 48% of the necessary housing units are for-sale homes. This marks an increase of 3% compared to prior evaluations. The primary demographic driving demand for for-sale homes comprises residents with incomes between 81% and 120% of AMI, necessitating home price ranges of $283,734 to $425,600.
The median home price in Grand Rapids has significantly risen, showcasing a 23% increase from $220,000 in 2022 to approximately $270,000 in 2024, further complicating affordability issues for potential homeowners.
Beyond the city limits, an additional 20,591 housing units are required throughout Kent County to meet the 2029 targets. Demand for owner-occupied homes is particularly high, with 77% of the total housing need outside Grand Rapids categorized for ownership. Furthermore, the need for owner-occupied homes has grown by 4.3% since the last assessment, mainly from families above 121% of AMI.
To meet the projected goals set for 2029, the county would need to surpass historical building permit data, issuing more than 23,972 permits between 2014 and 2024, thereby facilitating the development of over 10,000 new units.
The challenge of affordability is striking in the region, with data revealing that nearly 47.8% of Grand Rapids renters spend over 30% of their income on housing costs. The situation is similarly concerning outside the city, where 45% of renters face the same financial strain. Among homeowners, 17% in Grand Rapids and 16% outside the city report spending over 30% of their income on housing-related expenses.
The findings of this study serve as a clarion call for increased housing production and strategic planning in the region as officials and stakeholders grapple with ongoing issues surrounding housing affordability and availability.
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Additional Resources
- Ainvest: Grand Rapids Housing Crunch
- Wikipedia: Housing in the United States
- MLive: Housing in Grand Rapids
- Encyclopedia Britannica: Real Estate
- WOOD TV: Affordable Housing Units in Grand Rapids
- Google Search: Grand Rapids housing crisis
- Crain’s Grand Rapids: Housing Projects in Kent County
- Google Scholar: Housing Affordability Grand Rapids
