Big Picture
The economic disruption caused by the COVID-19 pandemic exacerbated the already dangerous costs of rent and mortgage payments. Now, America is experiencing an affordable housing crisis; the housing supply is far short of demand and housing prices are reaching record highs, leaving a historic number of people without homes. Housing costs are also a key driver of inflation. In light of the housing crisis, American policymakers must take action to make housing more affordable and available, as the issue of housing is one of human rights and impacts people’s access to food, water, education and economic opportunity. While federal housing assistance expansion and reform require a complex and nuanced approach, certain initiatives would expand housing access to low-income renters and increase the affordable housing supply.
Operative Definitions
Pathways to Removing Obstacles to Housing (PRO Housing): A federal grant program implemented in 2023 that provides funding to communities to support rezoning initiatives.
Fair Housing Initiative Program: A federal program that provides grants to nonprofit fair housing organizations, which educate the public and housing providers on fair housing practices and investigate allegations of discrimination in housing.
Low-Income Housing Tax Credit (LIHTC): A federal program that provides tax credits through state governments to housing developers constructing affordable housing projects. The project must continue to meet the eligibility requirements for 30 years.
Important Facts and Statistics
Half of American renters spend at least 30% of their income on rent.
In the last decade, the number of low-rent units has decreased by 2.1 million.
According to a survey from the Pew Charitable Trusts, at least 70% of people, regardless of party affiliation, support the five most popular policies for encouraging more apartment construction.
The Low-Income Housing Tax Credit (LIHTC) has helped create more than 3.6 million units since 1986.
Homelessness is at an all-time high, with the 2023 Point-in-Time count (measuring how many people were experiencing homelessness on a single night during the year) found that about 20 of every 10,000 people in the U.S. were experiencing homelessness.
3-Step Plan
1. Implement a federal renter’s tax credit program for extremely low-income renters.
Many tenants, especially those who qualify as low-income or extremely low-income, struggle to afford rent on top of other living expenses. A tax credit program would provide direct financial assistance to renters, bypassing any need for landlord cooperation with rent assistance, which is not always guaranteed. Also, rent in government-subsidized housing is still a massive financial burden for low-income renters.
2. Increase the housing supply by expanding LIHTC, encourage local rezoning efforts and continue monitoring the impact of PRO Housing.
Limited housing supply is a central driver in the affordable housing crisis. Current federal programs aimed at encouraging the construction of affordable housing have not kept up with demand— expanding federal investment in programs such as LIHTC would help bridge the gap between supply and demand. Furthermore, exclusionary municipal zoning laws have historically been a large factor in disincentivizing the construction of affordable and multi-family units. Encouraging and removing barriers to rezoning should be a priority in the effort to increase housing supply.
3. Update the Fair Housing Initiatives Program.
Recognizing and addressing the social inequities in housing should be another priority when approaching the housing crisis. Updating the Fair Housing Initiatives Program would help remove administrative barriers and ensure the quicker allocation of federal funding in the efforts to eliminate discrimination in housing.
Why This Initiative Is Important
The issue of housing affordability is now particularly pressing, as more and more Americans feel the financial strain of soaring rent and limited housing options. While there are many federal housing assistance programs in place, funding has not kept up with growing need, and the implementation of many programs is bogged down with bureaucratic inefficiencies. Revising and expanding these programs is crucial. Ultimately, housing is a human right, and limitations in housing availability can have detrimental impacts on health, education, economic activity and mobility. Investing in housing is an investment in the American people.
Acknowledgment: The opinions expressed in this piece are those of the individual author.
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