Editor’s Note: This story is the last in a two-part series on the housing and rental market in the State College area.
College students aren’t the only ones feeling the pinch of a more competitive housing and rental market in the State College area.
Morgan Wasikonis, the director of Housing Transitions, a Centre County nonprofit that provides housing programs to those in need, said the amount of affordable workforce housing in the area has fallen by about 400 units in the past five to eight years. While some have been replaced, it’s not a zero-sum game.
According to the Department of Housing and Urban Development, families who pay more than 30 percent of their income for housing are considered above the affordable housing threshold. HUD reports that about 12 million renter and homeowner households pay more than 50 percent of their income for housing, which means they may have trouble affording necessities such as food, clothing, transportation and medical care.
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“It’s kind of a domino effect,” Wasikonis said. “It doesn’t sound like a lot, but it is for the people who need those places. It stresses everyone because it sort of trickles down to the people who are on the edge of being able to afford places to live.”
David Price, lead real estate agent with RE/MAX Centre Realty, agreed. He said the local real estate market has faced challenges in navigating a shrinking pool of options. Compared with the year before, he estimated the region was 25 percent below inventory of available housing in 2016.
“Anything that is moderately priced is gobbled up very quickly,” he said. “We’ve been telling folks since the end of last year, if you are thinking about buying, be absolutely ready to make a decision and prepare to move because the inventory just isn’t there, particularly in the Centre Region.
“We take folks to see the house and by the time you’re walking out the front door, you get a text from the listing agent that says, ‘thanks for looking at the house but we’ve already sold it.’ ”
Centre County Commissioner Mark Higgins noted the county is growing, adding about 1,500 net new residents annually. While the growth reflects the quality of life and the productive entrepreneurial scene in the region, he said, the county runs the danger of becoming a victim of its own success.
In other strong startup markets, for instance, housing and rental prices have stretched beyond the reach of everyday people.
In San Francisco, the starkest example, housing prices increased by more than 50 percent from 2011 to 2016, according to data from the Bureau of Labor Statistics and housing market site Zillow. Across the U.S., they increased by more than 10 percent during that time period.
Though San Francisco is an outlier, Higgins said, it’s a cautionary tale that growing markets, such as State College, can learn from.
“Creating housing that people can afford is quite possibly the most complex issue that we face in the county,” he said. “The concern is we can price ourselves out of, for example, the entrepreneurial market. We’re doing great in a broad variety of areas for job creation, for entrepreneurship, for supporting small businesses, but a portion of this is the owners of these organizations and their employees have to live somewhere. And if we reach the point where it costs so much to buy a single-family home or rent a reasonably nice apartment, entrepreneurs will go wherever they want.”
High-rises or apartment complexes have been proposed for both ends of downtown State College along College Avenue, including one a block away from The Metropolitan, and another on East Beaver Avenue. Nearly all of the Fraser Centre’s luxury condos and penthouses, meanwhile, have been leased.
Like the other proposed buildings downtown, The Metropolitan, located at 400 W. College Ave., will feature an urban aesthetic, combining retail space below with apartment living above. Landmark Properties, based in Athens, Ga., and local company PennTrust Properties are the developers on the project.
For State College, it means more housing in a market that needs it. But it also coincides with the rising cost of living in a college town — and for students, the growing burden of paying for a college degree.
“I’ve always felt strongly that when everyone has a certain quality of life, it’s elevated for everyone and we all benefit,” Wasikonis said. “Having people being able to afford the roof they have over their head, it really helps reduce stress for people and it sort of helps stave off a lot of other problems that they may experience.”
Since she took over as director a year ago, for instance, Wasikonis has seen the housing market affect those most in need.
Housing Transitions’ home-buying and rehabilitation program is funded through a federal block grant. She said the nonprofit is preparing for having a smaller pool of dollars to pull from in the near future. While the organization operates a privately-funded emergency shelter and has a housing case manager who works with clients to find affordable places to live.
“It’s getting more difficult,” she said. “We’ve had people who are in crisis and can’t afford to stay where they’re at or have been couch-surfing for a while, and then becoming homeless.
“There just aren’t places for them to go.”
For the region, tackling the issue requires all stakeholders, Higgins said, to come to the table.
“I don’t think any one group can solve this problem in isolation,” he said. “We’re all going to have to work on this together.”