The concept of affordable housing has gained considerable attention in the last few years. However, the challenges presented by the COVID-19 pandemic have hindered the industry substantially. With rising prices and delayed construction timelines, the supply and demand gap has been widening continuously. The pandemic which caused people to lose their jobs or face pay cuts has bumped up demand considerably without doing much for the supply side, as assessed by Maxwell drever.
For affordable housing projects to create an impact, demand and supply has to work in tandem. Getting inexpensive housing right is essential for stakeholders on both sides because they all have a lot on the line. This is a challenge especially with global supply chains for building materials disrupted. At the same time, growing labor costs make the prospects of building affordable dwellings extremely difficult. Still, here are some ways in which supply and demand can be brought to work together.
Identifying the Bottlenecks
Knowing the source of the problem is essential for a viable solution to be found according to Maxwell Drever. With the COVID-19 pandemic and its impacts, there have been a lot of bottlenecks especially on the supply side ranging from expensive labor to delayed shipments of building materials. At the same time, affordable housing finance has also taken a hit with inexpensive options becoming rare. Each issue is a separate discussion that requires a different plan which is why knowing them is the first step.
Making Collaborations Possible
In many of the issues that are being faced by the affordable housing segment, multi-level collaborations can make a considerable difference. These partnerships can include financial institutions, manufacturers, suppliers, contractors and various other stakeholders. With everyone having a considerable stake in the game, solutions can become easier to come by, asserts Maxwell Drever. Together, each party can offer a path that can ease some of the bottlenecks in the supply chain.
Working on Ways to Preserve the “Affordable” Aspect
With all the problems that have cropped up for the housing sector in recent years, the biggest impact has been on pricing. With demand rising rapidly, there aren’t enough “affordable” units to satisfy the market. Although with global trade dynamics being involved, there is little that can be done to streamline the supply chain for products, other solutions can be explored to make sure that prices are curtailed to some extent.
This can once again be achieved through collaborative efforts as noted by Maxwell Drever. Through government subsidies and working closely with suppliers, both local and international, some of the problems in the supply chain can be circumvented. As a result, prices can come down. On the other hand, affordable financing options from financial institutions is another way to stabilize the market on both sides.
The affordable housing market is under a lot of stress due to the supply chains that are disrupted worldwide. This is presenting a substantial challenge for balancing demand and supply for these units. Although some of the issues will only resolve with time, there is immediate corrective action and alternative arrangements required at present to make sure that the market doesn’t collapse.