Governor Gretchen Whitmer and other state leaders have set a new housing production goal for Michigan: permitting, building, or rehabbing 115,000 units over five years. This significant increase from the earlier target of 75,000 units underscores the state’s commitment to addressing the chronic shortage of affordable and quality housing.
A Vision for Housing
Governor Whitmer announced this revised target at the Detroit Regional Chamber’s Mackinac Policy Conference on Mackinac Island, revealing that Michigan is ahead of schedule, with nearly 50,000 units already built, renovated, or permitted. The original goal, which aimed for 75,000 units, has been revised upward by 53% to meet the growing demand.
“It’s ambitious, it’s achievable, and it’s absolutely necessary,” Whitmer declared during the news conference. “Our housing supply is not where it needs to be for several reasons — a decadelong slowdown in construction following the 2008 recession and a lack of state investment. Now we are raising our goal because we’ve been exceeding our targets, driven by our dedicated investments.”
Addressing the Energy Challenge
In addition to increasing housing units, the governor highlighted the federal funding that Michigan is receiving to help 18,000 low-income households install solar panels on their roofs or in their communities. This initiative aims to reduce energy costs for new energy-efficient appliances for 10,000 people. The funding includes $211 million for home efficiency rebates and home electrification and appliance rebates under the 2022 Inflation Reduction Act, along with $156 million for a “Solar for All” program.
The Michigan Department of Environment, Great Lakes, and Energy is expected to open the rebate programs this fall, with the solar program becoming available to residents in the summer of 2025. This effort not only addresses housing but also tackles energy efficiency and sustainability, providing a comprehensive approach to improving living conditions for Michigan residents.
The Economic Imperative
The cost of housing, whether to rent or own, has been a pressing issue for Michigan’s business and political leaders for years. Metro Detroit home values have appreciated by about 55% in the last four years, with rents also experiencing double-digit annual increases, according to Rent.com. This inflationary trend is largely driven by a lack of supply.
Amy Hovey, CEO and executive director of the Michigan State Housing Development Authority, emphasized the economic fundamentals at play. “Basic economics are, if you are short on supply and high on demand, the cost increases. We really have to help the market. The market is not working how it should,” she explained during a panel at the conference. The disparity between the cost of developing housing and what Michiganders can afford is a significant challenge that has resulted in the current housing crisis.
Legislative Action Needed
Hovey called on the Democratic-controlled House to pass two critical bills that would help achieve the new 115,000-unit target. House Bill 5032 would raise the maximum purchase price for a unit financed with an MSHDA loan to 90% of the average area purchase price, adjusting current limits to more realistic levels. Senate Bill 293, approved by the Senate last June, would give the state flexibility to use the Housing and Community Development Fund to support middle-income families, not just low-income ones.
“I am begging that politics be taken out of housing and that we all get together to make sure Michiganders have a place to call home,” Hovey pleaded, highlighting the bipartisan nature of the issue.
A National Concern
The housing crisis is not unique to Michigan. Nationwide, the struggle to afford housing continues. For instance, Pontiac-based mortgage lender United Wholesale Mortgage recently introduced a 0% down payment program in the form of a second lien loan, a strategy reminiscent of the homebuying frenzy during the pandemic.
The disconnect between typical incomes and the actual cost of housing is a problem that developers across the country are grappling with. Glenn Wilson, president and CEO of Flint-based Communities First Inc., encapsulated the dilemma: “When you think about those particular numbers, how are people supposed to have that home ownership opportunity? The math doesn’t add up. Unless we get additional resources to solve that problem, you’re going to continue seeing low-income families struggle.”
A Call to Action
The revised housing goal set by Governor Whitmer and Michigan’s state leaders is a bold step toward solving the housing crisis. It reflects a comprehensive approach that includes increasing housing supply, enhancing energy efficiency, and addressing the economic challenges faced by residents.
This initiative is not just about numbers; it’s about ensuring that every Michigander has a place to call home. It’s about creating a future where affordable, quality housing is not a privilege but a right. As we look ahead to 2026, the success of this initiative will depend on continued investment, legislative support, and the collective will to overcome the barriers that have long hindered housing development.
In the words of Governor Whitmer, “This is ambitious, it’s achievable, and it’s absolutely necessary.” Michigan is on a path to not only meet but exceed its housing goals, setting a precedent for other states to follow. The road ahead may be challenging, but the vision is clear: a Michigan where everyone can thrive in a home they can afford.
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