Anchorage Needs More Land

I have recently learned that the U.S. Census Bureau classifies Anchorage(MOA) and the Mat-Su together as a metropolitan statistical area (MSA). MSAs are areas with economic ties to the central area, as measured by commuting patterns. Currently, there are 57,000 vehicles per day that leave Anchorage heading north with exits to Eagle River, Chugiak, Palmer, Wasilla and all the way to Chase, Alaska with a population of 19 in 2020 but the majority of vehicles head to the ‘Valley’ aka the Matu Su Borough. It has a population of 111,752 and 25,000 square miles compared to the MOA’s population of 281,810 and 1,961 square miles which makes the MOA’s land base only 7.8 percent of the Mat-Su’s. I share this with you because the MSA vs. MOA is an important distinction when analyzing residential inventory and where it is built and what Anchorage as a ‘ hometown’ is competing against. The March 2023 ‘Alaska Economic Trends’ reports that Anchorage’s recent population loss of 12,000 was, therefore, not a loss for the MSA because 5,000 moved to the Valley. However, Anchorage’s loss has had a significant negative impact on Anchorage’s school population and created a negative impression of our community.

 

With limited land to build on compared to the Valley, if Anchorage is going to meet its stated goal of 1,000 new housing units per year for the next several years, there are a lot of changes that will need to occur. But before I address some of these changes to the land development and building process, let me be clear. Based upon my knowledge accumulated over 45 years of residential sales and land development experience, it is impossible to build ‘affordable’ housing without subsidies, provided by various local, state and national governmental entities or private contributors, whether non-profits, trusts, churches or individuals. Market housing in the future, on the first and second rung of the housing ladder, will be smaller, narrower, closer together, stacked, clustered, et cetera, but the bottom line is a 2×6 costs the same regardless of where its framed.

 

One housing problem Anchorage has that the Valley doesn’t is that the ‘median’ age of an Anchorage home is 43 years. Most purchase and sale agreements DFTs (deal falls through) occur over the dreaded home inspection report that every buyer is advised to have when purchasing an aging home. We have seen home inspection reports that are over 40 pages long with recommended’ and suggested items. Both sellers and buyers should only be willing to accept repairs/changes for health and safety items. Every home has a sheetrock crack. You should only be concerned if they are more than a quarter of an inch, not the hairline ones around a door jam. The same is true for garage floor cracks. After all, we live where there are 20,000 earthquakes a year—most of which we never notice. Our residential property taxes should be lowered and competitive to the Mat-Valley’s. Our building permit costs should be adjusted to the Valley’s. Right now, the difference is over $6,000 for the same size dwelling.

 

But what Anchorage really needs to put a dent in our 1,000 requested new housing units per year is to find more land. And since we can’t make any more of it where is it? Anchorage has 223 parks which amounts to over 10,946 acres of municipal parkland. Parks are either dedicated or designated. A dedicated park means to change its status, it must be approved by the Anchorage Assembly. Either dedicated or designated is a nimby challenge. A one acre park is usually situated on a road and generally has all utilities to its boundaries, including water,sewer, gas, electric because it is usually in a neighborhood that is already developed. so there is no cost for land development. A one acre park with a residential zone could accommodate approximatelyl 4-5 single family homes or 9 duplex attached townhomes. If the land cost is generally 25% of the price of a home and all utility extensions are another 35% that would be a tremendous reduction in the overall cost of the home to be built. If we only developed 10% of the parks, we could create at a considerably lower cost approximately 200 attached townhomes with three beds, two baths and a double car garage of 200 attached townhomes. And because of their location and utilities, it could be a much rapidly process. Maybe even get started in late 2025.

 

And one more idea when looking for more land. Every parent would like to walk their children to school. Some Anchorage schools sit on as much as 15 acres of land. Five to six Anchorage schools are being considered for closure. While repurposing them is a valid discussion, let’s include affordable market rate housing into the discussion. Again, all utilities are already on site making them attractive for residential development. Our population loss is not limited to aging boomers. We are losing families with school age children to the Valley. Let’s bring those families back to Anchorage and their children can walk to school.