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Mathew Davis, who lives in a homeless shelter in Austin, Texas, would love an apartment of his own. But with the little money he makes donating blood plasma, even a $450-a-month\u00a0tiny home\u00a0with no running water and a communal bathroom would be a stretch.<\/p>\n
Meanwhile, over 4,500 units the city classifies as affordable \u2014 nearly 16% \u2014 sit empty.<\/p>\n
\u201cI don\u2019t make enough money really to afford anything,\u201d Davis, 49, said of the few hundred dollars he earns a month. \u201cI just keep trying to swim uphill.\u201d<\/p>\n
The\u00a0poorest people in the U.S.\u00a0face the\u00a0most acute shortages\u00a0of affordable homes. But the majority of low-income housing financed in recent years is for those earning 50% of an area\u2019s median income or above, according to a survey of state housing agencies.<\/p>\n
Some cities are now seeing an uptick in vacancies as rents for these units approach market rates. The result: Apartments designated as affordable sit empty because the\u00a0poorest of the poor\u00a0cannot afford them.<\/p>\n
Meanwhile, some people are forced into homelessness and others into desperate circumstances to pay for housing they can\u2019t afford.<\/p>\n
The poorest have few housing options<\/p>\n
There are only about 4 million affordable rental units available for the country\u2019s 11 million extremely low-income renter households, according to the National Low Income Housing Coalition\u2019s\u00a0most recent annual report.<\/p>\n
These are people with annual incomes either below the federal poverty guidelines \u2014 just under $16,000 for a single-person household \u2014 or 30% of the median income in their area, whichever is higher. They comprise about a quarter of U.S. renter households, and include many people working low-wage jobs, seniors and those with disabilities living on fixed incomes.<\/p>\n
About three-quarters of extremely low-income renter households pay over half their income on rent and utilities, the report said, leaving little leftover for other necessities.<\/p>\n
Yet homes set aside for these renters were only about 12% of the affordable housing units financed in 2024 by the Low-Income Housing Tax Credit \u2014 a\u00a0federal program\u00a0providing\u00a0tax credits to developers\u00a0in exchange for keeping rents low for at least 30 years, according to figures from the National Council of State Housing Agencies.<\/p>\n
The majority are for those earning at least 50% of an area\u2019s median income, or AMI. In Austin, that\u2019s a single person earning roughly $47,000 a year, as compared with an extremely low-income person earning under $28,000.<\/p>\n
The program has financed nearly 4 million affordable units nationwide since its creation 40 years ago. But some experts say it\u2019s inefficient \u2014 and more costly than housing vouchers.<\/p>\n
\u201cIt\u2019s enormously complex and bureaucratic, and it raises the cost of construction enormously because the rules are so complicated,\u201d said Chris Edwards, an economist at the Cato Institute, a libertarian think tank, who\u00a0told Congress\u00a0the program\u2019s complexity \u201cspawned\u201d an industry of law and accounting firms just to administer it.<\/p>\n
\u201cIf you\u2019re going to subsidize affordable housing, you should give the money directly to tenants,\u201d he said, referring to housing vouchers.<\/p>\n
Other experts say the two programs work together well because properties built with the tax credit are required to accept vouchers \u2014 while landlords of market-rate apartments in many states are not.<\/p>\n
Still, there\u2019s a\u00a0major federal funding shortfall: Experts estimate only one-in-four eligible families ever receive vouchers. Vouchers can help the poorest pay for housing that\u2019s targeted to higher income groups, but the waitlist can be yearslong.<\/p>\n
Some affordable housing developers say that without vouchers, it\u2019s not economically feasible to provide units for extremely low-income people.<\/p>\n
True Ground Housing Partners, an affordable housing developer in the Washington, D.C., area, gives an example: A unit for those earning 60% of the area\u2019s median income \u2014 nearly $70,000 a year \u2014 brings in $1,715 per month in rent. But after $1,575 in mortgage and operating expenses, only $140 is left.<\/p>\n
\u201cThe math does not lie,\u201d said president and CEO Carmen Romero, noting that an extremely low-income person would pay only half that rent.<\/p>\n
\u201cOur expenses don\u2019t make it really possible to create a 30% AMI unit, unless there was this extraordinary amount of subsidy that just doesn\u2019t exist.\u201d<\/p>\n
Affordable housing competes with market-rate rents<\/p>\n
Meanwhile, affordable housing rents for 60% AMI units are approaching those of market-rate apartments in U.S. cities like Austin, Denver and Portland, Oregon.<\/p>\n
As a result, some people are opting to pay a bit more for market-rate apartments with less income-verification and faster approval \u2014 leaving growing numbers of affordable units vacant.<\/p>\n
In Austin, the vacancy rate for all affordable housing is nearly 16% with over 4,500 vacant units, according to real estate data and analytics firm CoStar. A healthy vacancy rate is around 5%.<\/p>\n
LDG Development, an affordable housing developer, cited a 12% vacancy rate for its 60% AMI units in Austin. Chief portfolio officer Rebekah Fischer said LDG is \u201cin direct competition\u201d with the thousands of new market-rate apartments recently built in Austin.<\/p>\n
\u201cI have to have every bank statement, every pay check, every bill, every Venmo transaction that you had with your friends,\u201d Fischer said of affordable housing applicants.<\/p>\n
\u201cWhen we\u2019re almost going after the same renter, you can be approved within two minutes at a market-rate deal, where unfortunately in affordable housing \u2026 it takes time.\u201d<\/p>\n
In Denver, there\u2019s a 13% vacancy rate among 60% AMI units financed by the federal tax credit program \u2014 and a 21% vacancy rate for 80% AMI units, according to the Colorado Housing and Finance Authority. Meanwhile, there is\u00a0far too little housing for the city\u2019s poorest.<\/p>\n
In Portland, where there is also\u00a0a housing shortage\u00a0for the lowest income groups, there are over 1,700 vacant affordable units for an overall vacancy rate of 7.5%, according to the Portland Housing Bureau. Most are for those earning 60% AMI, or about $54,000 for a single-person household, with rent capped at $1,444 per month.<\/p>\n
That\u2019s close to the average rent of $1,581 for a one-bedroom market-rate apartment, according to CoStar figures shared by the bureau.<\/p>\n
Portland resident Jaiden Barbee earns around 55% of the area median income and is on waitlists for affordable housing. But, he says, he\u2019d pay more for a market-rate apartment to avoid the lengthy application process.<\/p>\n
\u201cI\u2019d rather spend the $200 extra just to get into a place easier that\u2019s wherever I want\u201d and doesn\u2019t have \u201call these hoops,\u201d he said.<\/p>\n
\u2018I want to shut the door at night and sleep\u2019<\/p>\n
Austin officials set a goal of building 20,000 units between 2018 and 2027 for extremely low-income people \u2014 17% of the city\u2019s households.<\/p>\n
Just 543 were built as of 2024, city documents show.<\/p>\n
Meanwhile, all 15,000 units planned for those earning between 60% and 80% of area median income were built.<\/p>\n
In response to questions from The Associated Press, the Austin housing department said it recognized the need to do more to produce housing for the poorest people and was taking steps to do that, including giving preference to funding proposals that include 30% AMI units.<\/p>\n
For Davis, who lived in his car for a year before getting a bed in the Austin shelter, the housing shortage for people like him is frustrating.<\/p>\n
\u201cI want to shut the door at night and be able to sleep,\u201d he said. \u201cI really just want to find the right place.\u201d<\/p>\n
__<\/p>\n
Former AP writer Charlotte Kramon contributed.<\/p>\n
#math #lie #Austin #built #lowincome #homes #delivering #middle #class<\/p>\n","protected":false},"excerpt":{"rendered":"
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