Alas! There is no place like home!

In many parts of the country, housing costs and shortages have begun to show signs of adversely affecting corporations, workers, and local economies. Affordable housing — such as Boston's Orchard Gardens, — is increasingly scarce. How serious is the problem?

It's a tale of two Americas, the best of times and worst of times if you're a consumer in the current U.S. housing market. On the plus side, thanks to the 1990s' economic boom, some two-thirds of Americans, more than ever before, currently own their homes. At the same time, housing of all kinds — for buyers and renters — has become more expensive precisely because of the country's prosperity. With the wages and purchasing power of working people largely stagnant over the last two decades, the cost of adequate housing in a decent neighborhood has soared beyond the reach of many. Today, the demand for affordable housing exceeds the supply by a record 5.3 million units.

"Affordable housing is a problem that increasingly affects companies and employers, as well as the overall economy," says F. Barton Harvey (MBA '74), chairman and CEO of the Enterprise Foundation, a nationwide housing and community development nonprofit organization. Harvey explains that exorbitant housing costs encourage young, professional workers to look elsewhere for jobs, threatening the continued vitality of local industries that depend on their talents. (For example, 86 percent of the companies in one recent survey said that housing costs were a serious deterrent to attracting businesses and middle-income employees to New York City.) On the lower end of the wage scale, companies are forced to pay bonuses and to bus workers long distances to fill essential blue-collar positions. Says Harvey, "Firms must respond to these realities with higher wages, which make the goods and services they produce more expensive, which in turn makes the overall economy less competitive in a global business environment."

Where the Heart Is

Along with food, shelter is perhaps the most basic human need. In modern society, stable, safe housing is more than a matter of comfort and convenience; it positively affects childhood development, individual self-esteem, and family viability.

Housing is generally considered "affordable" when its cost does not exceed 30 percent of the median family income in a given area. In one typically hard-pressed neighborhood, Boston's South End, the average two-bedroom apartment rents for $1,400, considerably more than 30 percent of an average South End family's income. In Massachusetts as a whole, one recent study estimates that between 1990 and 1997, two hundred thousand more people moved out of the state than into it, in large part due to housing prices.

The more worse is yet to come, across the nation, government cutbacks on construction, maintenance, and subsidies for low-income housing, combined with the booming economy's overheated real-estate market, have created what many experts are calling an affordable housing crisis. They predict that the problem is likely to get worse because of a widening income gap and a shrinking stock of low-income units. As a result, business may eventually have to take a more proactive stance, as it has with education and health care, using its influence, creativity, and resources to help address the issue. Decent, affordable, and stable housing is a basic human necessity; it is also a prerequisite for maintaining a productive national work force. The bottom line speaks clearly: there's no place like home.