New data released by my organization, Builders of Hope CDC, and data partner Reinvestment Fund of Philadelphia, reveal how housing affordability in Dallas is out of reach for its essential workforce and the problem is getting worse.
In 2012, the typical homebuyer in Dallas earned $42,000 annually and could afford 44% of homes sold that year. By 2023, the median income increased to $64,000 annually, but the share of homes that were affordable for that worker significantly decreased to 12%. Based on current trends, by 2032, the average wage earner in Dallas will only be able to afford 2% of housing stock.
For renters, who are usually more vulnerable, the stats are worse. The typical renter in 2012 made $32,000 annually and could afford 47% of available rental stock. Rental affordability decreased to 34% of housing stock last year and is projected to decrease again to 21% by 2032.
In essence, Dallas has become unaffordable for its essential workforce.
But it’s not just a problem for hourly workers. Consider the starting salaries for professional jobs at the top employers in our city: A registered nurse starting out at UT Southwestern Medical Center, a first-year teacher at a Dallas Independent School District school, and a rookie cop with the city of Dallas barely make enough to afford a one-bedroom apartment. Homeownership is completely out of reach for those workers.
If they can’t afford to live in Dallas, where do they go?
Squeezed out
The middle class is shrinking in our country. But for the average worker, the shrinkage is more like a squeeze. Squeezed out of the urban core, out from places once called home, and out to the outskirts of our city or suburbs. According to the most recent Census Bureau data, the percentage of low to moderate wage earners who live in the suburbs has increased year over year.
The next time you sit down at your favorite Dallas restaurant, ask your waiter where they live. Many of the workers feeling the squeeze are in the retail and service sector. This imbalance adds additional pressure on small and community businesses.
Balancing out
Tracy German, owner of the Cake Bar, says that non-skilled employees anticipate making more than $25 an hour just to keep up with the cost of living. That equates to more than $40,000 annually for a 30-hour part-time employee that works the register. That’s enough to burden any small business.
This is one of the reasons your local store may not be open for as long, why the wait time is longer, and why even in the midst of record low unemployment small-business owners are having a difficult time finding help. Housing affordability is the cornerstone of a thriving economy at the microlevel.
There is also an opportunity cost to unaffordable housing. Wages paid are spent outside of the local economy instead of recirculated in the local community. Healthy dollar circulation is the bloodline for small, local and community-centered businesses and how we assure economic mobility from the bottom up.
A defining moment
The late Mayor Edwin Lee of San Francisco told me one time, “You have to see the threat sooner in order to save it” in reference to gentrification in the Bay Area. Yes, Dallas is growing, but for whom? As the data above reveals, the next 10 years will be a defining moment for our city. If we act now, we might have a small window to do what other cities have failed to: not sacrifice our working class for the sake of growing the tax base.
Here are a few big-picture solutions I think we can start with.
Be intentional
Every conversation regarding growth should include solutions to mitigate further economic burden on the most vulnerable residents.
Want to build a new building? Great! How will that development affect the nearby neighborhood? Or how can living-wage jobs go to legacy residents?
Thinking of establishing a Texas Stock Exchange? Wonderful! What are ways we can pour resources back into lower-income communities to assure the economic impact is equitable?
I am not suggesting some ambitious aim to eradicate poverty once and for all. What I am suggesting is that while we’re building our big buildings, paving the way for our grand parks and propelling Dallas to its full economic potential, we must be just as intentional about not leaving our most vulnerable residents behind.
Think big
The current housing affordability crisis is the perfect storm to spur innovation. Steady demand is forcing a second look into what housing can look like, how we are housing, and why it is so hard to increase supply. It’s felt by the middle class enough to become a kitchen-table topic.
Now that it has everyone’s attention, let’s wipe the whiteboard clean and start fresh thinking about what it can be.
Until we reform zoning laws, reimagine density and reshape how we increase access to housing, we’ll never close the housing gap.
Embrace partnerships
Housing developers can’t build us out of this crisis alone. Neither can policy advocates pass up enough laws to fix it overnight. What gives us the best shot at creating a city where all incomes can live, work and play is if we all make housing affordability our responsibility. The most successful stories of affordable housing are scenarios where multiple stakeholders are involved: Local municipalities, practitioners, banks, corporations, school districts and nonprofits unifying to create an ecosystem of support to tackle a big problem.
A good model worth mentioning is the newly created Fort Worth Community Land Trust, a partnership with the city of Fort Worth, the nonprofit Housing Channel and the Rainwater Charitable Foundation. This initiative will include 200 units and secure generational housing affordability.
We must act now and be as bold and intentional as we are about promoting growth. Every year that goes by that we fail to make substantial change is another year we choose to see the threat and not try to save it.
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