What’s the Problem?
The problem of housing for moderate-income and below is two-fold. Firstly, major urban cores are suffering from an affordability crisis. Residents in these areas earning 80-120% AMI (considered moderate-income) who want to live within 15–20 min of work are being priced out of the country’s urban centers. Those who embrace living in these areas will often spend more than 40% of their income on rent. Rising student and credit card debt, coupled with consumer debt at all-time highs, means a market-rate apartment averaging $2500-3200/month is not sustainable. Secondly, the housing gap between supply and demand will not be satisfied with the number of units being built; it is just too vast. Building our way out of the housing crisis through more and more typical market-rate apartments simply does not work.
Furthermore, building typical market-rate and renting at affordable levels does not pencil for developers or banks. Various tax credits and other government incentive programs have not successfully addressed the missing middle in housing (for those earning 80-120% AMI) yet, leaving large numbers of city dwellers searching for a solution that works.
How can Micro Apartments Help?
Innovative micro apartment buildings provide a new free-market based attainable housing solution specifically for the missing middle. Micro apartments range from 180-400 square feet depending on the market and include a place to sleep, a small kitchen, a bathroom, and a small living area. Micro apartments do not have an expansive kitchen or a spacious living room. However, building amenity spaces are more extensive and purpose-built as common areas that fulfill residents’ needs, resulting in much more efficient use of space. The price point of these units is usually considerably lower than for standard apartments in the same neighborhood.
Micro apartments allow for buildings with Class A finishes, intentional design, coworking spaces, and free wifi in a first-class location while allowing letting residents to remove the burden of high rent costs. Lower rent burden allows residents the freedom to pursue their goals.
Moreover, when residents can live close to work and major transit centers, they can eliminate long stressful commutes and enjoy a better work-life balance. They can also use building co-working spaces to work remotely. By giving up a little space, micro apartments unlock a whole new way of living for many residents. With savvy property management, there is also ample opportunity to foster community with groups of other like-minded individuals through programmed social events and gatherings, adding to the desirability of living in these spaces.
Housing affordability is a complex issue that will not go away anytime soon. However, increasing the development of high-quality micro apartments can ease the pressure for rent-conscious apartment seekers. It’s one step in the right direction of building future cities that flourish. Micro apartments add to our cities’ economic diversity and resilience, ensuring that they grow and prosper for years to come.