Lasting Affordability
Deconstructing the housing affordability crisis: How we can move forward by looking back
The housing affordability crisis gripping the United States is complex, but doing nothing for lack of a comprehensive strategy only ensures the crunch will continue.
According to the National Low Income Housing Coalition, the affordable housing gap widened by more than 500,000 homes during the COVID-19 pandemic, resulting in the shortage of 7.3 million affordable homes currently available to the lowest-income renters, reflecting a more than 7% increase between 2019 and 2021.
Meanwhile, a recent Fannie Mae study pegged the cumulative single-family housing shortage affecting both renters and homeowners at about 4.4 million units nationwide.
The figures are sobering because they reveal that 1-in-7 U.S. households already pay half or more of their monthly income toward housing alone, and Habitat for Humanity can only address the mortgage needs of about 4,000 families per year.
Times like these are when terms like innovation get tossed around, but let me be clear: There are no quick fixes, and advocates waiting on the housing version of Uber or InstaCart to materialize and fill the gap are ignoring the obvious.
Sometimes innovating doesn’t mean starting from scratch.
Sometimes progress occurs when tried-and-true methods are re-evaluated with fresh eyes and committed hearts.
Rather than wringing hands over the widening affordable housing gap - without offering actionable solutions - we should focus more on maximizing the reach of what’s working.
Lasting affordability models, for instance, which include community land trusts, help to leverage and prolong the impact of subsidies invested in the development of affordable housing units. Using these models is also more likely to result in economic mobility and wealth generation.
A key component of Habitat’s lasting-affordability success hinges on the use of community land trusts, a tool first embraced by Black farmers during the U.S. Civil Rights Movement of the 1960s to avoid mass evictions. By shouldering the cost of land acquisition and development, Habitat can then sell the homes to low- and moderate-income families at below-market rates while retaining ownership of the land. Buyers are then contractually obligated if they sell the home to do so at a price affordable to other low-income buyers.
Again, CLTs have been around for decades, there’s nothing new to see here, but leveraging this tool allows Habitat – and any other nonprofit with a similar commitment to improving access to affordable housing – to stabilize housing costs, whether we’re talking about homes for renters or entry-level homeowners.
Rebooting an old idea doesn’t come without its challenges. Take the 30-year-old New Urbanism movement as an example. The “new” idea refreshed the grid-based, dense, transit-oriented older American city and provided principles for brand new housing and downtown development. Opponents argue the approach invites gentrification, but reclaiming neglected spaces and crafting communities people want to be a part of can directly increase supply if zoning restrictions and the like are re-evaluated through an affordable housing lens.
The number of American families priced out of affordable homeownership continues its unchecked climb, fueled primarily by skyrocketing interest rates and inadequate lending sources.
By refocusing efforts on scalable programs with proven results, however, we can address the factors within the control of low- and moderate-income homebuyers and close the gap.
