National Affordable Housing Report – March 2025
Affordability restrictions will expire on more than 850,000 units by 2038, according to a Yardi Matrix report.
More than 850,000 private LIHTC units are on their way to reach the end of their compliance and extended-use periods between 2025 and 2038, according to the latest Yardi Matrix Affordable Housing report. Upon expiration, owners will no longer be bound to limit rents.
This year alone, about 29,000 private LIHTC apartments will hit the compliance period’s end, representing 2.2 percent of stock. Another 15,000 units, or about 1.1 percent of inventory, are on track to meet the end of their extended-use period in 2025.
During the next three years, north of 44,600 private LIHTC units are set to reach the end of their extended-use period. Five states will pass the 2,000-unit mark in this timeframe. Texas leads the way with 9,179 units, followed by Florida (6,512 units), Ohio (2,800), California (2,185) and North Carolina (2,122).
Though these units may no longer be affordable, that doesn’t necessarily translate into a thinning out of stock. A counterbalance of 69,800 fully affordable, private-sector units is projected to debut throughout the U.S. over the next three years, resulting in a net gain of 25,000 affordable units. California takes the lead with a projected net gain of 10,372 affordable units over the next three years, followed by New York (2,604 units) and North Carolina (2,411). Conversely, Ohio could lose 1,666 affordable units and Maryland might be 559 affordable units short.
Looking past the compliance period’s end
The future of assets approaching the end of their compliance period relies upon their location, performance and condition. Properties in pristine condition could attract value-add investors who may be tempted to turn them into market-rate communities.
Maintaining affordability is also an option attainable through 4 percent LIHTC, debt and equity subsidies. However, the available grant volume may fall short of the required capital expenditure earmarked for maintenance and repairs, according to Paul Fiorilla, Yardi Matrix Director of Research.
Read the full Yardi Matrix Affordable Housing report.
