Housing affordability has become one of the most pressing issues facing American communities. From service workers to young professionals, finding adequate housing at reasonable prices continues to challenge millions. Charles Covey brings a unique perspective to this problem, having worked in housing development from the ground up, literally starting as a teenage framing crew member and building his way to leading major development projects.
Building Understanding Through Experience
Covey’s journey into real estate began at age 16 on a house framing crew. “I was the new guy on a house framing crew. I had to really earn my stripes,” he recalls. His early experience taught him valuable lessons, including one particularly memorable incident. “I was able to get promoted from swinging a hammer to being able to use the nail gun, which to me at 16 felt like a big deal,” Covey explains. “Shortly after getting promoted to the nail gun, I proceeded to shoot myself in the foot with a three-inch framing nail. Not only was that very painful, but I got demoted from the nail gun and had to earn my way back again.”
Despite the painful lesson, those formative years shaped his understanding of housing construction. “Being able to watch a house appear from nothing after guys get out there and work hard every day, sun up to sundown, and after a few months now we have a house where there wasn’t one. That process has never lost its luster for me,” he shares. This hands-on foundation continues to inform his approach to development today, particularly as he manages businesses in the blue-collar space and stays connected to the housing challenges his team members face daily.
The Root Causes of Unaffordable Housing
According to Covey, three major factors drive housing costs higher than necessary.
- Navigating Bureaucracy That Slows Progress – First, excessive bureaucracy slows development and inflates expenses. “The development process has become mired in bureaucracy. It is a process that often takes too much time, too much money, and too much risk,” he notes. “They say that this adds about 30% to the overall cost. That’s a big number.”
- Equity Favors Flashy Luxury Over Simpler Livable Communities – Second, important equity that developers need naturally gravitate toward luxury projects. “It’s definitely easier to raise money on a big, flashy high-rise than it is on two-story, duplex, quadplex affordable housing. It’s not as sexy and it’s not as easy to raise capital,” Covey observes. The capital raising simply favors high-end development, even when affordable housing is desperately needed. Thankfully this is shifting as more savvy investors see the dependable and solid returns of achievable housing projects.
- Expanding Expectations for Larger Homes – Third, Americans have convinced themselves they need increasingly larger living spaces. “Many of our parents and grandparents grew up in a house that was 800 or 1000 square feet. They speak about those times in those homes very fondly. It was a wonderful, beautiful time. Everybody was happy. They had plenty of space,” he says. “That’s a house that doesn’t really exist anymore. You don’t see this kind of house built new.”
Practical Solutions for Affordable Housing
Covey identifies three key strategies to address affordability.
Designing Smaller, Smarter Living Spaces
The most effective immediate solution involves smaller home designs. “The big thing that I think affects price most efficiently and quickly is a smaller form factor,” he states. While national builders have begun offering more compact options, convincing consumers remains challenging because people believe they need more space than they actually do.
Redeveloping Underused Urban Land
Another promising approach involves redeveloping underutilized land, particularly parking lots. “As an example there is an estimated 10,000 acres of unused or poorly utilized land in Dallas-Fort Worth, primarily parking that could be converted to housing,” Covey explains. His current projects include converting an old golf course, redeveloping a significant chunk into achievable housing. These creative reimaginings of existing spaces offer significant potential for new housing development.
Rethinking Materials to Reduce Costs
The third strategy focuses on rethinking construction methods and materials. Cities often require specific materials and construction techniques that drive up costs unnecessarily. “Cities do have a lot of power to regulate what things look like in their city, and oftentimes they’re concerned more with the aesthetics than they are with the affordability,” he points out. However, municipalities are starting to recognize the consequences when service workers cannot afford to live in the communities where they work. This creates challenges for restaurants, hotels, schools, retail and other businesses when their staff has to drive long distances for housing. Those businesses drive tax revenue and if they can’t thrive and grow because a workforce can’t find a place to live nearby, it does affect the city’s financial situation in a tangible way.
While AI cannot replace the physical work of construction, it can dramatically improve the development process. “There’s a lot of ways on the front end of development that AI and analytics can really be helpful in site selection and finding the best sites,” Covey notes. Cities could use these tools to speed up plan reviews and approvals that currently take months. “Having cities and municipalities integrate these into their system is so important. Unfortunately, that’s going a little slower than I would prefer, but it is happening.” For industry leaders looking to make a difference, Covey emphasizes the importance of innovative thinking. “Development and construction tends to be lagging in the world of technology and forward thinking. They tend to just do it the way they’ve always done it. For leaders to really step out of their comfort zone to look at what new tools are available to them and place less emphasis on what has been done in the past would provide opportunities to be different and to take a fresh approach towards developing achievable housing.”
Connect with Charles Covey on LinkedIn to explore how innovative development can reshape housing affordability.
