Building for the Future: Access to Affordable Housing Fuels Economic Growth

By Nathan Kessler, Tax Policy Advisor

The Problem

It’s no secret that almost everything has gotten much more expensive in recent years, and housing has been a major victim of inflation. From 2019 to 2023, median housing costs in the U.S. rose from $1,112 to 1,358 per month, a jump of 22%.1 This is problematic for a number of reasons, but an immediate concern is the impact of unaffordable housing on the workforce.
Wisconsin Governor Tony Evers put it well, saying “Lack of access to affordable housing will hold our families, our workforce, and our economy back.”2 As cities across the U.S. become more expensive to live in, millions of workers are at risk of being displaced in search of more affordable housing.

Governor Evers goes on to acknowledge the challenge of our generation, “there is important work ahead of us to ensure that local communities have the resources and infrastructure necessary to support a strong workforce and safe neighborhoods.” The leaders of today must make a substantial investment in developing affordable housing in order to sustain economic growth that doesn’t leave the working and middle class behind.

The Proposition

Let’s look at housing affordability a little closer to home. Neither Kansas nor Topeka were spared from the effects of housing inflation, with median housing costs rising 19% and 16%, respectively.1 However, the cost of housing remains notably lower in our own backyard compared to the nation overall. This is important because the value proposition offered by Kansas, and Topeka specifically, is our competitive advantage in attracting a skilled workforce.

While perhaps lacking the wide range of amenities offered by larger metropolitan areas, Topeka boasts a median housing cost nearly 32% lower than the nation, at $924 per month. Despite the value offered by the city and its excellent location, situated between the state’s largest universities and an hour from Kansas City, Topeka’s population is essentially unchanged since 2000. This stagnating population may partially reflect the stagnation of the city itself.

As of 2023, less than 15% of the occupied housing in Topeka was built in the 21st Century while nearly 40% was built prior to 1960.3 Such an outdated housing stock may be partially responsible for holding the city back from its full potential. Times have changed and with them lifestyles and family structures. Prospective homebuyers of today have a different set of tastes and preferences than those of the 20th Century, and it is important for cities to adapt if they wish to attract and retain residents. To this end, officials in Topeka should pursue a strategy of developing new, affordable housing that caters to a new generation of market participants.

The Path Forward

As the saying goes, “if you build it, they will come,” and that should be the mantra of local officials for the foreseeable future. While many Kansas cities have experienced population growth, Topeka has not been able to capitalize on the advantages of being the state capital and being budget friendly. If stakeholders – including developers, local government, and community-based organizations – work together, Topeka can expand and modernize its housing stock and become more attractive to potential residents.

Topeka was actually featured as the top emerging real estate market in a 2023 Realter.com report, something readers may be surprised to learn.4 And while their December 2024 report has the city ranked 16th, being one of the most affordable in the top 20 should be easy marketing for Topeka.5 By building new housing with a focus on providing value, Topeka could quickly regain the top spot and strengthen the local workforce for years to come.

By drawing more people into the city, and therefore more income, Topeka will become an excellent candidate for increased business investment that can fuel economic growth. This bottom-up approach to economic development ensures the benefits are widespread and lift all boats, so to speak. Topeka is full of potential and by facilitating projects like SENT’s efforts to develop single- and multi-family housing, the city can significantly improve its prospects for the future.

 

Nathan Kessler
Tax Policy Advisor

 

Work’s Cited

1) U.S. Census Bureau, U.S. Department of Commerce. “Financial Characteristics.” American Community Survey, ACS 1-Year Estimates Subject Tables, Table S2503, 2023.
2) National Governors Association. (2023, May 11). How governors are addressing housing access and affordability and the connection to workforce success.
3) U.S. Census Bureau, U.S. Department of Commerce. “Physical Housing Characteristics for Occupied Housing Units.” American Community Survey, ACS 1-Year Estimates Subject Tables, Table S2504, 2023.
4) Danielle Hale, H. J. (2023, October 25). Fall 2023 Wall Street Journal/Realtor.com Emerging Housing Markets index. Realtor.com Economic Research.
5) Jones, H. (2025, January 13). December 2024 hottest housing markets. Realtor.com Economic Research.

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