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HAGATNA, GUAM – Affordable housing is a compelling topic that reflects the economic landscape and public policies contributing to our current challenges. I empathize with young couples and families struggling to make ends meet. When I returned home after completing my engineering degree in 2002, I was struck by the abundance of opportunities. A family friend wanted to sell their three-bedroom condominium for $120,000. Although I couldn’t afford it the offer wasn’t totally out of reach, which reminded me of the optimism surrounding homeownership during my youth.
So, why do we lack affordable housing, and how did we reach this point? Housing is more than an economic indicator; it directly influences our community's ability to thrive. It forms the foundation of stable families and neighborhoods, providing our next generation with opportunities to succeed. Recently, I’ve noticed more young families relocating to the mainland for better prospects and lower living costs. Without affordable housing, we risk losing the brightest members of our future.
A Perfect Storm of Challenges
The high cost of construction in Guam arises from multiple factors. The island’s reliance on imported materials means even small fluctuations in the global supply chain can cause significant price increases. Additionally, Guam is vulnerable to natural disasters like typhoons and earthquakes, leading to stringent building standards that require structures to withstand severe weather. While these safety measures are essential, they add to construction costs due to the need for more robust materials and designs.
Moreover, the limited availability of skilled labor drives up wages, further straining developers and prospective homeowners. Although the military buildup opened doors for foreign skilled laborers, the benefits remain elusive. It often makes sense for large contractors to pursue military contracts that allow for optimal use of their labor force. However, it’s not all bleak for those living outside military installations. Kudos to the Guam Department of Labor for spearheading efforts to secure H2B visa exemptions for housing projects outside military bases.
Collaboration with our military community may provide the solutions we need. Reports indicate that constructing a single-family home on a military base can cost upwards of $900 per square foot, primarily due to strict defense construction requirements. At that price, the economic costs can outweigh the benefits, even with a substantial military budget. However, costs can be significantly reduced off-base where these stringent regulations do not apply. A public-private partnership to build housing for military and civilian personnel could optimize public funds.
The Land Dilemma
Land availability presents another challenge. Guam's zoning regulations restrict development space, particularly in desirable areas with existing infrastructure. Recent efforts to permit accessory dwelling units (ADUs) in R1-zoned lots could relieve some pressure, allowing multigenerational families to build without the added cost of purchasing land. Currently, R1 zoning permits only one house per lot, but if ADUs are allowed, detached structures could be constructed on the same lot, provided they meet certain regulations. While concerns about infrastructure and environmental impact exist, I believe our leaders can find a balanced approach.
A Vision for the Future
In conclusion, the issue of affordable housing in Guam is not merely a local challenge, it is a reflection of broader economic dynamics that require immediate attention and innovative solutions. As we face rising construction costs, labor shortages, and restrictive zoning laws, it is crucial that we foster collaboration between the military and civilian sectors while advocating for progressive policy changes. By embracing initiatives like accessory dwelling units and exploring public-private partnerships, we can create a more sustainable housing market that benefits all residents. We owe it to our young families and future generations to ensure that homeownership remains an attainable dream, not just a distant hope. Together, we can build a thriving community where everyone has the opportunity to put down roots and prosper. Let’s act decisively to confront these challenges head-on, ensuring that Guam remains a place where families can grow, thrive, and call home.
The Guam Chamber of Commerce is a non-profit voluntary association of over 400 businesses, professional individuals, and firms united in their desire to improve business and build a better social and economic community in Guam.
Mr. Tae Oh is the Vice Chairman of the Board of the Guam Chamber of Commerce.
For additional information, contact the Guam Chamber of Commerce at 671-472-6311/8001 or email info@GuamChamber.com.gu.
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October 18, 2024
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