Opinion: The capital structure solution hiding inside the housing crisis

The ongoing housing crisis has brought attention to the need for new supply, but the existing stock of workforce housing is often overlooked. The median age of housing stock being at a 45-year high highlights the importance of preservation capital to maintain and upgrade these aging units. As the infrastructure industry looks to address the housing shortage, it's crucial to consider the role of financing in preserving existing workforce housing, rather than solely focusing on new construction.

The decline of 7 million units priced under $1,000 per month is a significant concern, as it exacerbates the affordability crisis. Financing stabilized housing like infrastructure could provide a solution, allowing investors to view these properties as long-term assets rather than short-term investments. This approach could attract new sources of capital, such as pension funds and insurance companies, which are typically drawn to stable, income-generating investments. By treating workforce housing as a form of infrastructure, the industry may be able to unlock the necessary funding to preserve and upgrade these critical properties.

As the infrastructure industry moves forward, it will be important to watch how policymakers and investors respond to the idea of financing workforce housing like infrastructure. The ROAD to Housing Act's focus on new supply is a step in the right direction, but it's equally important to address the preservation capital needs of existing housing stock. Industry leaders should pay attention to emerging financing models and partnerships that prioritize the preservation and upgrade of workforce housing, as these innovations may hold the key to addressing the affordability crisis and ensuring that vital housing infrastructure is maintained for generations to come.

Originally reported by housingwire.com. InfrastructureNews adds analysis for real estate & property readers.