The Economic Power of Missing Middle Housing: Affordable Housing Solutions

The term missing middle refers to a range of housing types that bridge the gap between single-family homes and large multifamily complexes.

These housing options offer diverse, affordable living spaces that fit seamlessly into existing neighborhoods.

According to the National Low Income Housing Coalition, there is a shortage of 7 million affordable and available rental homes for extremely low-income renters in the U.S.

The importance of missing middle housing cannot be overstated.

This shortage highlights the critical need for more housing options catering to various income levels and household sizes.

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What is impacting Missing Middle Housing Demands?

Three factors are impacting the demand for missing middle housing:

Changing Demographics:

• Increase in smaller households and multigenerational living.
• A rising number of baby boomers need care and prefer to age in place.

Economic Factors:

• Inflation and the rising cost of single-family homes.
• Rising cost of elder care.
• Millennials seek affordable, flexible housing options close to urban amenities.

Urbanization Trends:

• A desire for walkable living areas and community-oriented neighborhoods.
• Both millennials and aging boomers want to live in vibrant, walkable communities.

Why Missing Middle Housing Matters

The overall housing supply is falling short. People are tired of working till they are 80 just to pay for housing. They want more freedom and less housing expenses.

People are also going back to living with extended family.

The Pew Research Center reports that multi-generational households have increased over the past decade, driving the need for more flexible housing options as aging populations look to downsize.

By incorporating missing middle housing into urban planning, cities can better meet the needs of their residents and promote more inclusive and sustainable growth.

A study by the Joint Center for Housing Studies at Harvard University highlights that missing middle housing can help address the estimated shortfall of over 1 million housing units in the U.S.

The Types of Missing Middle Housing

Missing middle housing includes several types of homes that fill the gap between single-family houses and large apartment buildings.

Here are some examples:

Each type of housing brings unique benefits and supports a diverse range of family sizes and income levels.

By integrating into existing neighborhoods, they enhance walkability and community feel.

Benefits of Missing Middle Housing

Missing middle housing offers several benefits that make it a valuable addition to urban communities:

Missing Middle Housing Historical Context and Background

Before WWII

Missing middle housing was more common in the years before World War II. Before the war, cities often included various housing types that allowed for diverse communities.

Duplexes, triplexes, and courtyard apartments were typical in many neighborhoods, providing affordable options and supporting vibrant, walkable areas.

After WWII

The rise of car culture led to zoning laws favoring single-family homes and large apartment complexes.

These changes often excluded missing middle housing types, leading to their decline. Single-family zoning became the norm, limiting housing diversity and contributing to the current housing crisis.

How Tiny Houses and ADUs can help fill in Missing Middle Housing

Tiny houses and Accessory Dwelling Units (ADUs) are innovative solutions that address the need for missing housing.

Tiny houses and ADUs help fill the housing market gap by offering more diverse, affordable, and flexible living options. We can’t create more land, but we can do more with our land.

Tiny Houses and ADUs increase density and housing choices without large-scale developments.

Tiny Houses:

• Tiny houses offer flexible, affordable living spaces. They can be integrated into existing neighborhoods without significant infrastructure changes.
• These tiny homes provide an alternative for those looking to downsize or seek affordable housing.
• Example: Tiny house communities have been developed in North Carolina to provide affordable housing. Acony Bell is one such community.

Accessory Dwelling Units (ADUs):

• ADUs are additional housing units built on the same lot as an existing single-family home. They can be detached, attached, or converted from spaces like garages.
• ADUs provide additional housing options, making them ideal for multigenerational living, rental income, or downsizing.
• Example: Los Angeles, California, has seen a surge in ADU housing construction to address housing shortages. The city has streamlined the permitting process, encouraging more homeowners to build ADUs.

3 Policy Recommendations to Promote Missing Middle Housing

To promote missing middle housing, we need supportive policies and community engagement. Here are some ways to promote this needed housing:

1. Zoning Reform:

• Change zoning laws to allow for more diverse housing types, including duplexes, triplexes, townhomes, tiny houses, and ADUs.
• Encourage mixed-use development that integrates residential and commercial spaces.

2. Incentives for Developers:

• Offer tax breaks, grants, or low-interest loans for developers who build missing middle housing.
• Provide financial incentives for homeowners to add ADUs or convert existing structures.

3. Community Engagement:

• Involve community members in the planning process to gain support and address concerns.
• Educate residents about the benefits of missing middle housing, such as affordability, diversity, and walkability.

5 Economic Impacts of Adding Missing Middle Housing

Missing middle housing can positively impact communities by offering cost-effective housing solutions and supporting local economies.

1. Efficient Use of Resources

Building middle housing is often cheaper than single-family homes or large apartment complexes because you use the land and resources more efficiently.

This will reduce the overall construction costs. These savings can translate to more affordable housing.

2. Diverse Population

Increasing housing options through middle housing can attract a diverse population.

Diversity supports a dynamic and resilient local economy by ensuring that people from different economic backgrounds can afford to live in the same area.

3. Support for Local Businesses

Higher density in a neighborhood can increase demand for local businesses and services, such as shops, restaurants, and healthcare facilities.

This increased demand stimulates economic growth and creates jobs.

4. Efficient Infrastructure Use

Higher-density housing can lead to more efficient use of public infrastructure like transportation and utilities.

This can reduce the cost per person for maintaining and upgrading these services. I smell a potential savings for municipalities.

5. Property Value Stabilization

Adding missing housing can increase property values by revitalizing underused spaces.

Higher property values also contribute to the community’s economic health by increasing the tax base and providing more funds for public services and infrastructure improvements.

Final Thoughts

Missing middle housing is essential for creating diverse, affordable, and sustainable communities.

By supporting policies that promote these housing types, we can address housing shortages, enhance community diversity, and improve overall quality of life.

Advocate for missing middle housing in your community to foster more inclusive and resilient neighborhoods.

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