Courtney LeVinus

Rising housing demand in Arizona is starting to outpace new supply, and the affordable housing supply in particular has reached a crisis point, according to a recent report from the Arizona Multi-Housing Association. In the state, 32% of households require an affordable housing permit, and 48% of households require an affordable housing permit. To accommodate this demand, AMA says the market can support considerable new construction activity.

“This is a function of supply and demand. As more apartments are built and the state's housing stock increases, prices naturally decrease,” Courtney LeVinus, president and CEO of the Arizona Multi-Housing Association, tells GlobeSt.com. “Unfortunately, for various reasons including increasing land prices, local land use restrictions, and costly regulations, we can't build fast enough to meet the growing demand.”

Several markets throughout the country and on the West Coast in particular have seen issues with the supply of affordable housing, along with rising rental rates and housing costs. LeVinus says that the solution is to build more supply. “Communities around the country, including those in California, are realizing that ignoring the signs of a dwindling housing supply can have strong economic implications,” she says. “There are many reasons for these shortages that need to be addressed in order to avert crisis. For example, local land use restrictions, onerous design guidelines, discretionary review processes, and neighborhood hostility have made it much more difficult to bring new housing developments online. Add increasing land prices and labor shortages to the mix as well. All of these pieces add to the cost of housing.”