Affordable housing is the cornerstone of effective homelessness prevention.
By expanding the inventory of housing options that low-income individuals and families can realistically afford, communities create pathways to stable housing for those experiencing or at risk of homelessness.
The Link Between Housing and Homelessness
The lack of affordable housing is a significant cause of homelessness, especially for people with low incomes. When housing costs consume too much of a person’s income, even minor financial setbacks can lead to losing their home.
Chronic homelessness—when people experience homelessness for extended periods or repeatedly—is strongly tied to the shortage of affordable and permanent housing.
Eleven million households spend more than half their income on rent, putting them at risk of homelessness.
Success Stories from Cities
Cities that focused on expanding affordable housing stock have shown remarkable progress in reducing homelessness:
- New York City has reduced homelessness through expanding affordable housing units.
- Salt Lake City’s Housing First programs, coupled with new affordable housing development, have helped thousands find homes.
- Houston has significantly decreased chronic homelessness by increasing the availability of affordable housing units and using its unique housing market advantages.
These success stories demonstrate that increasing the affordable housing supply can effectively address homelessness.
The Housing First Approach
The Housing First approach provides immediate access to permanent affordable housing without prerequisites. This model recognizes that increasing the availability of affordable housing units is the foundation for addressing homelessness and that supportive services are more effective when people have stable housing.
Evidence of Success
Studies show that Housing First programs, when combined with expanded affordable housing stock:
- Help people maintain stable housing long-term
- Reduce the number of people utilizing emergency shelters
- Create pathways out of homelessness that are sustainable
Strategies to Expand Affordable Housing Stock
Government Policies and Incentives
Policies that directly increase affordable housing supply include:
1) Expanding the Low-Income Housing Tax Credit program to create more units.
This federal program provides tax incentives to developers who build or rehabilitate affordable rental housing, effectively reducing construction costs and allowing for lower rents. Since its creation, the LIHTC has financed the development of over 3.2 million affordable housing units nationwide.
2) Implementing inclusive zoning rules that require affordable units in new developments.
These regulations mandate that a percentage of units in new residential developments must be affordable to lower-income households. By leveraging private development, cities can create affordable housing without direct public funding, ensuring mixed-income communities across neighborhoods.
3) Offering density bonuses to developers who include affordable housing.
This incentive allows builders to construct more units than typically permitted by zoning if they include affordable housing. For example, a developer might be allowed to build a 12-story building instead of an 8-story one if 20% of units are affordable, creating a financial incentive that increases both the market rate and affordable housing supply.
4) Converting unused commercial properties into affordable housing.
Many cities have vacant office buildings, hotels, and retail spaces that can be repurposed for housing. By changing zoning codes and offering tax incentives for adaptive reuse, municipalities can quickly add affordable units to their housing stock while revitalizing underutilized properties.
5) Streamlining approval processes for affordable housing developments.
Lengthy permitting processes add significant costs to housing construction. By creating expedited review processes specifically for affordable projects, cities can reduce development timelines from years to months, lowering carrying costs and enabling more affordable units to be built faster.
Innovative Building Techniques
Methods to build more affordable housing quickly and cost-effectively include:
- Modular construction (building homes in factories before on-site assembly)
- Alternative materials, including prefabricated panels that reduce costs
- 3D printing technology to reduce construction time and expenses
- Adaptive reuse of existing buildings to create new affordable units
Nonprofit and Public-Private Partnerships
These collaborations directly increase housing stock by:
- Developing new affordable housing projects
- Renovating and preserving existing affordable units
- Leveraging combined resources to create more units than any single entity could alone
- Ensuring long-term affordability through proper management and oversight
Challenges in Creating More Affordable Housing
Zoning Laws and Neighborhood Resistance
Barriers that limit the creation of new affordable housing include:
- Single-family zoning that prevents multi-family buildings in high-opportunity areas
- Minimum lot size requirements that reduce density
- Community opposition to new affordable developments
- Height and density restrictions that limit the number of units that can be built
Addressing these challenges requires:
- Reforming zoning codes to allow more housing types in more locations
- Educating communities about how increased housing supply benefits everyone
- Demonstrating how well-designed affordable housing enhances neighborhoods
Funding Challenges
The U.S. lacks over 7 million affordable rental homes for very low-income households. Increasing this supply requires:
- Dedicated funding for new affordable housing construction
- Capital investment in the renovation of existing buildings
- Subsidies to make housing affordable for those with the lowest incomes
- Tax incentives and grants for developers of affordable housing
The Future of Affordable Housing Development
Policy Changes to Increase Housing Supply
- Upzoning to allow more units per lot
- Transit-oriented development with affordability requirements
- Streamlined permitting for affordable housing projects
- Increased federal funding for the National Housing Trust Fund
- Expanded rental assistance programs to make existing housing affordable
Technology Advances in Construction
New methods to build more affordable units faster:
- Factory-built components that reduce construction time and labor costs
- Innovative materials that lower building expenses
- Data-driven approaches to identify where housing is most needed
Conclusion
Increasing the supply of affordable housing is the foundation for addressing homelessness. By building more affordable units, preserving existing affordable housing, and ensuring these homes remain affordable long-term, we can create pathways out of homelessness for vulnerable populations.
When paired with appropriate support services, expanding affordable housing stock offers the most direct and effective approach to reducing homelessness in our communities.
Additional Resources:
https://endhomelessness.org/ending-homelessness/policy/affordable-housing
