Solutions to Ease the Affordable Housing Crisis

The affordable housing crisis affects nearly every community in the country. Jonathan Wolf of Wendover Housing Partners offers some solutions to speed up the building process and help meet the demand for more options.

By Jonathan L. Wolf

Jonathan L. Wolf

Jonathan L. Wolf

The affordable housing crisis affects nearly every community in the country, with some areas reaching crisis levels. Pick any city in the U.S. and chances are the community is experiencing its own version of the affordable housing crisis—rents continue to rise and housing options for working families continue to decline.

According to a study by the National Low Income Housing Coalition (NLIHC), the U.S. has a shortage of 7.4 million affordable rental housing units for extremely low income families, resulting in only 35 units for every 100 of those families.

While the situation is dire, there are some solutions that would help alleviate the crisis and meet the need for more safe, affordable housing. 


Funding is a key element in jump-starting the process to build more affordable housing units, and that means at the local, state and national levels.

The NLIHC suggests a realignment of federal housing expenditures to help address the affordable housing shortage. The group points out that higher income homeowners receive a significantly greater share of federal housing expenditures than low income renters—mostly due to the mortgage interest deduction. They compare the $65 billion total of the mortgage interest deduction to the $38 billion that was spent on all of HUD’s housing programs for the lowest income households in 2014. The NLIHC suggests reducing mortgages eligible for a tax benefit from $1 million to $500,000 and converting the deduction to a non-refundable tax credit, saying those two moves could generate more than $240 billion in new revenue over the next ten years that could be used to invest in affordable housing programs.

A study conducted by the Florida State University Center for Economic Forecasting and Analyses (FSU CEFA) on behalf of the Florida Realtors, looked at the economic impact of two of the state’s affordable housing programs; the State Housing Initiatives Partnership Program (SHIP) and the State Apartment Incentive Loan (SAIL) program. SHIP provides funds to local governments as incentives to create partnerships that produce and preserve affordable home ownership and multifamily housing. SAIL provides low-interest loans to affordable housing developers.

The FSU CEFA study found that over the 10 year period from 2006-2016, $1.3 billion was appropriated for the two programs—but the economic impact dwarfed what was spent. Researchers found that $1.3 billion generated:

  • $12.5 billion in sales and revenues
  • 94,149 people being employed
  • $2.9 billion in wages earned

That means for every dollar appropriated by the legislature over that ten-year period, more than $9 was generated by SHIP and SAIL programs in economic activity; and not only are we helping people that need affordable housing, but providing a wealth of other benefits by creating jobs and revenue sources.

In Denver, the city council created a $150 million housing fund last year that it will use to pursue land trusts and help its partners buy up small apartment buildings in order to create a new supply of affordable housing for thousands of residents struggling to stay in the city.

In contrast, legislators in Florida routinely raid the state’s affordable housing fund—called the Sadowski Fund—and use those dollars for other purposes. Over the past 10 years, the governor and legislature have shifted $1.3 billion from that fund away from affordable housing and into the general fund. This is at a time when Florida’s affordable housing crisis will deepen as the state receives an estimated 100,000 people from Puerto Rico who are leaving in the wake of Hurricane Maria.

Steps Towards Improvement

Other changes that can be made at the local level that would help jump-start the supply of affordable housing would be to:

  • Lower impact fees.
  • Speed up the approval process for projects that address the need for affordable housing.
  • Relax zoning regulations; even slight changes in setbacks, density and height restrictions could help bring more affordable projects to fruition.
  • Speed up the permitting process—this isn’t to suggest a weakening of the permitting process, just a willingness by local government agencies to speed up what can be a very lengthy process.

Utilizing infill development, as is being explored in Spokane, is another means of creating an additional supply of affordable housing. Drive around any community and see how many abandoned retail sites exist that could be utilized as affordable housing sites, rather than sitting empty for years.

In Charleston, voters recently approved the city’s request to borrow $20 million for affordable housing projects. The measure passed with an overwhelming 70 percent support of voters, a sign of the growing demand by the public for solutions. The city will lend the money to both public and private organizations to create affordable housing through construction or rehabbing existing structures.

On the national level, we should all be pushing for passage of Senator Maria Cantwell and Senator Orrin Hatch’s Affordable Housing Credit Improvement Act of 2017 legislation, which expands the Low-Income Housing Tax Credit and leaves the 9 percent LIHTC program in place.

Time is a crucial component in addressing affordable housing crisis. If a company were to break ground on an affordable housing complex today, it would likely take a year for the first residents to move in. If you’re starting from land acquisition, add another 18-24 months to that.

The good news is, many of the tools to attack the affordable housing crisis are already in place; the challenge is to convince the many parties who are part of the solution to actually utilize them.

Jonathan L. Wolf is president of Wendover Housing Partners LLC, a privately held real estate development, investment and management company founded in 1995. As one of the Southeast’s premier housing companies, Wendover specializes in the development of multifamily communities. Wendover’s expansive portfolio of affordable and mixed-income developments demonstrates the company’s success in creating housing opportunities in a variety of economically and socially diverse neighborhoods.

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