Last month’s announcement of Eli Lilly’s $5 billion investment in Goochland County brought excitement across Virginia’s capital region. The project is expected to create 650 jobs at West Creek Business Park, marking a significant economic advancement. Yet this achievement also highlights a growing concern: the lack of sufficient housing for incoming workers. n nAs of October 1, only 837 residential lots have been rezoned across seven counties and the city this year. Meanwhile, approximately 2,500 new homes were sold during the same timeframe. The gap between job growth and housing availability persists, driven largely by insufficient rezoning activity—key to unlocking new construction permits. n nIn contrast, 11 out of 12 regions in the Carolinas maintain a balanced relationship between employment expansion and housing development. Many achieve a ratio of one new building permit for every new job, reflecting deliberate planning that supports sustainable growth. This alignment may partly explain why North Carolina was ranked the top state for business by CNBC in 2025, while Virginia’s standing declined compared to the previous year. n nCurrently, the Richmond area issues just one building permit for every three jobs created. To sustain economic momentum, experts suggest moving toward a 1:2 or even 1:1.5 ratio. Applying the Carolina benchmark, the Goochland project would require rezoning approvals for between 325 and 650 single-family homes to match workforce needs. Without such action, the region risks appearing welcoming to corporations but unprepared to support their employees. n nThe broader regional outlook remains strained. Richmond typically authorizes 4,000 to 5,000 for-sale building permits annually. However, rezoning must occur two to three years ahead of construction, meaning an annual target of 4,000–5,000 newly approved lots is essential. With only 837 rezoned so far this year, the pipeline falls drastically short. n nMarket trends further illustrate the imbalance. According to Zillow, millennials now represent the largest demographic sharing residences with non-family members—a sign of mounting pressure on affordability and supply. In the second quarter of 2025, 468 condos and townhomes were sold in the Richmond area, accounting for 43% of all new home sales. These attached units are increasingly vital for workforce housing, with a median price of $427,071, significantly lower than the $618,310 average for detached homes—a difference of 45%. Under current income levels, only about 20% of households can afford a newly built home. n nHomebuilders and contractors are already adapting to these constraints, not due to weak demand, but because too few lots are available for development. Without policy reforms that align rezoning with actual market needs, both housing accessibility and regional economic strength could erode. n nTo address this, leaders in the Richmond region are urged to integrate housing planning with economic development strategies. Communities should establish clear housing-to-employment targets and respond to major corporate investments with coordinated residential approvals. Accelerated review processes—especially fast-tracked rezoning for job-generating developments—could demonstrate proactive planning. Incentives promoting affordable options like condos and townhomes, such as increased density allowances or shared infrastructure funding, might help narrow the affordability gap. A publicly accessible regional housing dashboard, updated quarterly, could monitor progress by comparing permit issuance and rezoning outcomes against job growth. Additionally, state policymakers should recognize housing supply as a critical factor in economic competitiveness, integrating it into broader workforce and development frameworks. n nThe Richmond region possesses the resources, land, and leadership needed to overcome this challenge—but only if housing is prioritized as a foundational element of economic strategy, rather than an afterthought. Each rezoning decision shapes whether workers can reside near their workplaces and whether the region remains competitive in attracting future investment.
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Richmond’s housing supply crisis is an economic development risk (Guest Commentary)
Last month, when I read Eli Lilly’s announcement of a $5 billion investment in Goochland County, I was thrilled. It’s a major economic development win for our region, bringing 650 jobs to the West Creek Business Park. But it also raised a pressing question: Where are all those new employees going to live? n nAs of Oct. 1, we’ve only rezoned 837 residential lots across seven counties and the city this year — an alarmingly low number. In the same period, we’ve sold about 2,500 new homes. The region continues to report an insufficient supply of building permits relative to job creation. And what drives new building permits? Rezonings. n nBy contrast, in the Carolinas, 11 out of 12 regions report a healthy alignment between job creation and housing supply. Ratios of one building permit per new job are common — an intentional balance that supports both workforce and economic expansion. It’s no coincidence that CNBC ranked North Carolina the No. 1 state for business in 2025, while Virginia slipped several places compared with the previous year. n nHere in Virginia’s capital region, only one building permit is issued for every three new jobs created. To keep pace with growth, we need to move closer to a 1:2 or even 1:1.5 ratio — a level that would better position us to house the very workforce driving our economy forward. n nApplying the Carolina standard, Goochland would need to approve rezonings for 325 to 650 new single-family homes in tandem with the Eli Lilly project. Without this parallel action, Goochland risks sending a mixed signal: pro-business in attracting employers, but unprepared to house the workforce those businesses require. n nThe regional picture is no stronger. Richmond typically issues 4,000 to 5,000 for-sale building permits annually. To sustain that pace, rezonings must occur two to three years in advance. Meaning, we need 4,000 to 5,000 for-sale lots rezoned annually, while we sit at 837 year-to-date. n nThe housing market itself underscores these constraints. Zillow reports that millennials are now the largest group of individuals sharing homes with nonrelatives, a clear symptom of affordability and availability pressures. In Q2 2025, builders sold 468 condos and townhomes in the Richmond region, representing 43% of all new home sales. These attached products are becoming essential to workforce housing: the average condo or townhome sold for $427,071, compared with $618,310 for a single-family home — a 45% premium. Optimistically, 20% of households can qualify for a new home under current average median incomes. n nBuilders and trades are already adjusting to this slower market — because fewer homes are being built, not because demand has disappeared. Unless rezoning policy evolves to meet market realities, we risk undermining both our housing affordability and our economic competitiveness. n nTo correct course, the Richmond region needs a rezoning strategy directly linked to economic development. Localities should set measurable housing-to-jobs targets and pair every major employer announcement with parallel housing approvals. Streamlined, predictable review timelines — including fast-track rezonings for job-related projects — would show coordination between growth and housing. At the same time, incentives for attainable housing such as condos and townhomes, including density bonuses and shared infrastructure costs, would help close the affordability gap. A regional housing scorecard, updated quarterly, could track rezonings and permits against job creation, while the state should treat housing supply as a core competitiveness metric, aligning it with workforce and economic policy. n nThe Richmond region has the talent, the land and the leadership to meet this challenge, but only if we treat housing as a central pillar of economic development, not an afterthought. Every rezoning is a decision about whether our workforce can live where it works, and whether our region can truly compete.