Housing supply

Local action to increase the supply of affordable housing

Local action to increase the supply of affordable housing

Creative policymaking at the local level has been key to addressing the housing shortage and its impacts. Photo credit: istockphoto.com/eyecrave productions

On June 23, 2022, the Bipartisan Policy Center hosted the Terwilliger Center Summit on Housing Supply Solutions in Washington, D.C. One panel, “Local Solutions for More Affordable Housing Supply,” focusing on the tactics local governments across the country are deploying to preserve and develop the supply of affordable housing. Moderated by Henry Cisneros, former secretary of the US Department of Housing and Urban Development, the panel included Flora Arabo, senior national director of state and local policy at Enterprise Community Partners; Michael Liu, director of the Miami-Dade County Department of Public Housing and Community Development; and Philip Mangano, President and CEO of the American Round Table to Abolish Homelessness.

The Local Housing Toolkit

Panelists recognized the ongoing challenge of maintaining housing affordability across the United States and reviewed the far-reaching work of local governments to address the issue. Efforts are focused on zoning reform, rental assistance, tenant-landlord relations, and targeted financing, among others. Increasing supply is important, Cisneros said, to avoid outcomes such as increased experiences of homelessness, displacement of long-standing communities from gentrifying neighborhoods and displacement of older residents. struggling to keep up with rising property taxes in rapidly appreciating areas.

Arabo identified the removal of zoning barriers such as exclusive single-family zoning or lot size requirements, which serve to limit low-income residents’ access to certain areas. Beyond removing barriers to land use, jurisdictions can be proactive, Liu agreed, by creating dense, transit-oriented areas, as is done in Miami. Increased density will build more housing, increase supply and put downward pressure on costs. Liu reports that in recent years, Miami-Dade County has become one of the least affordable places in the country to live for both renters and homeowners, a trend that has accelerated due to relocation activities during the pandemic.

Arabo described a zoning overlay in two rapidly gentrifying Chicago neighborhoods that prohibits developers from turning three-unit multifamily structures into single-family residences, helping to preserve the existing housing stock. The move echoed Cisernos’ concern that the loss of existing affordable units, whether through deterioration or displacement, remains a significant challenge for local governments.

Panelists also discussed efforts beyond zoning. To help address growing affordability challenges, Liu described steps Miami-Dade is taking to raise rent from the area’s Fair Market, which helps bondholders by effectively increasing the number of units vouchers can cover; use Emergency Rent Assistance Program funding to help both tenants in arrears and those experiencing rent increases of up to 20%; and doubling, to 60 days, the notice period required for rent increases.

Arabo has developed initiatives aimed at preserving existing affordable housing. San Francisco, for example, gives tenants and nonprofit housing organizations a right of first refusal to purchase small-to-midsize rent-regulated buildings at risk of market conversion. In Seattle, a rapid acquisition loan fund allows nonprofit developers of permanent supportive housing to better compete with well-capitalized developers of market-priced housing.

Local action with wider support

Many of the programs and initiatives profiled by the panelists, while locally driven, nevertheless depend on state and federal policies to achieve maximum impact. Liu described the pressure many owners of manufactured housing stock face to redevelop their properties as unaffordable market-priced apartment buildings for current residents; he saw the potential for incentives at the federal level to encourage these owners to redevelop their parks in ways that maintain affordability.

With respect to homelessness, panelists agreed that having an inadequate supply of affordable housing options is a key factor in determining whether people in a given area will experience homelessness. Mangano discussed ongoing efforts in California, many stemming from the pandemic and related state and federal funding, to increase housing supply targeting homeless individuals and families. With $5 billion in state funding and funding from the American Recovery Plan Act of 2021, as well as existing funding sources such as HUD vouchers, Mangano reports that the state has developed 20,000 new supportive housing units targeting homeless people, with resources available to bring another 15,000 online. These units are possible, he says, thanks to the on-the-ground efforts of local entities across the state.

Inadequate housing supply is an ongoing national challenge. Local governments and their state and federal partners have developed far-reaching strategies to bolster supply, preserve existing affordable housing, and mitigate displacement. As the panelists showed, creative policymaking at the local level has been key to solving the housing shortage problem and its consequences.

Visit the HUD User’s Regulatory Barriers Clearinghouse article archive on state and local solutions to increase the supply of affordable housing here.