Adaptive Reuse of the National Housing Act: Conversions of Commercial Properties to Multifamily Residences
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Date
2020-12
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Abstract
The lack of affordable housing has been a problem in the United States back to the 19th century. However, the gap between median home price versus median household income widened substantially in the period from 1975 to 2017 causing a decline in the homeownership rates for young adults aged 25 to 44 years of age. Unable to purchase homes, these young adults shifted their housing demand to rentals, which resulted in a similar increase in the amount of rent charged for homes. Higher rents made rentals more attractive as investments and resulted in the conversion of 3.9 million single-family homes to rentals between 2006-2016. With fewer single family homes available for sale, home prices rise and the cycle inexorably continues. While there is a shortage of affordable housing inventory, the link between houses for purchase and rentals is so strong that the addition of large numbers of either will impact housing prices overall.
Thus, from a policy perspective, it is necessary to consider either ways to utilize existing programs or the implementation of new ones. Currently, there are existing programs that assist with the financing of the purchase, construction, or renovation of homes. There are also separate programs that provide funding for the construction of multifamily units. However, there are no programs that fund the adaptive reuse (or conversion) of commercial structures to residential structures despite the fact that it costs 26% less than new construction. Consequently, this capstone evaluates case studies regarding the adaptive reuse of buildings and proposes that existing home buying financing programs be expanded to equate conversion with renovation, which will allow the repurposing of existing commercial structures into multifamily home units.
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affordable housing, adaptive reuse, building conversion