The City of Austin is building hundreds of affordable homes a year to tackle growing affordability challenges for low-income families – and to help prevent homelessness.
Austin’s Action Plan to End Homelessness has warned that many historically affordable units within the market are no longer affordable due to increased rent and re-development. The supply of affordable rental units is expected to remain a challenge given the continued population growth across the Austin area.
Analysis in the Strategic Housing Blueprint found that the city’s lowest-income households are the most financially stressed by housing costs, due to the limited supply of deeply affordable units available for a large segment of Austin’s population.
That is why creating new homes and retaining affordable units specifically for individuals and families with low incomes is a key priority for the Neighborhood Housing and Community Development Department (NHCD) and the Homeless Strategy Office.
Figures from the City’s Affordable Housing Inventory show that over the last decade (2009-2018), 8,465 income-restricted affordable units either came online or began their affordability period – the length of time that the units are required to be affordable to low- and moderate-income households. That’s an average of 846 per year.
The number of those homes coming online in the last five years is up 84% in comparison with the previous five years (5,485 between 2014 and 2018 compared with 2,980 between 2009 and 2013). The Inventory also shows there are 11,238 income-restricted units in the “pipeline,” which means they are expected to be built in the coming years.
Income restricted units are those that cater to families earning between 30% (or below) and 80% of the median family income, which in Austin in 2019 was $95,900 for a 4-person household, according to the U.S. Department of Housing and Urban Development. This means families of four earning up to $76,720 could qualify.
“While we’re working hard to support people experiencing homelessness today with the urgent help they need to get off the streets, the best way to prevent homelessness over the longer term is to create policies that recognize that wages are staying the same but rents are rapidly rising,” said Lori Pampilo Harris, Austin’s Homeless Strategy Officer. “With rents getting more expensive in Austin, the City’s efforts to maintain and increase the supply of safe, permanent and stable housing that is affordable for all who want to make Austin their home will be essential to our overall strategy of preventing and ending homelessness.”
“The City’s vigilant efforts to address the needs of our homeless community members are through a consortium of important partnerships to include Austin’s service providers and numerous City departments and community agencies,” said Rosie Truelove, director of Neighborhood Housing and Community Development.
Texas State law prevents the City of Austin from requiring private developers to provide a proportion of affordable units in any new development. The state also prohibits the City from levying impact fees on new development to fund affordable housing, or from limiting rent increases. All these restrictions make it harder for the City to provide low-cost housing.
Instead, the City relies on a range of other resources and tools to maintain and increase the supply of affordable units, including:
- Federal funding
- General obligation bonds
- Low-income housing tax credits
- Repurposing public property
- Attempting to preserve market rate affordable housing
- Setting aside property tax revenues from increment financing and homestead preservation districts.
Another key tool is the City’s affordable housing bonus program. Under this voluntary, market-driven incentive program, which does not require cash subsidy from the City, developers are permitted to build more units or taller buildings if they agree to make a proportion of their development income-restricted affordable housing. The proposed Land Development Code revisions would expand the parts of the City where this density bonus program can be used – from 3% of the City’s land area to 17%. The revised Code, if adopted, is projected to increase the capacity for new affordable units generated by the program from 1,500 to 9,000.
Other programs and resources to boost affordable housing and help people facing homelessness
The City of Austin’s Fiscal Year 2020 Budget allocated $8.3 million for homeowner repair and assistance programs to help people remain safely in their homes, $7.1 million for homelessness prevention services such as housing location and placement, case management, and financial and legal assistance, and $5 million for renter assistance programs such as emergency relocation services for those at risk of displacement.
The Housing Authority of the City of Austin (HACA) administers several rental voucher programs, including Veteran Affairs Supportive Housing, serving 464 transitioning homeless veterans, and the Homeless Program Grant.
NHCD’s Rental Housing Development Assistance and Acquisition & Development programs have provided funding to private developers to create affordable rental and ownership units.
- General obligation bonds for affordable housing were approved by Austin voters in 2006, 2013, and 2018. The funding is being used to build and preserve thousands of quality, affordable homes for the most vulnerable families and individuals and for low wage workers in our community.