By the Numbers:

82%— the amount of new rental housing built in the US  as luxury priced housing according to a 2015 study commissioned by the Wall Street Journal. We are under-building housing for lower and middle income households.  *

58— the number of available affordable housing units nationwide for every 100 households earning less than 50 percent of Area Median Income. In most central city locations, the supply of affordable units was far lower.

26%— the number of eligible very-low income families who received assistance from a federal rental assistance program (such as Section 8). HUD is only able to support just over 1 in 4 eligible very low-income families.*

3.5%— the nationwide percentage rise in rents in 2015, which marked the fastest rise in nearly 30 years. *

2 million— the number of affordable rental units in the US needed to meet the need of renter households with income at 50% of AMI or less. *

The Missing Middle

Most government programs support housing for families below 60 percent of area median income, but there is an emergent need in many communities for housing that is affordable to families between 60 percent and 120 percent of median income, often called middle-income housing. In many places, inclusionary housing programs are among the only tools for creating housing that is affordable to this income group.

Common Questions

If we build more luxury housing, won’t that just free up existing units for lower income residents?

Yes: But probably not enough. It might stand to reason that development of housing—any kind of housing—would lead to lower housing prices. In most urban areas, however, the opposite occurs. Construction of new housing impacts the price or rent of existing housing in two different ways simultaneously. As the basic notion of supply and demand suggests, the addition of new units in a given housing market will inevitably put some downward pressure on the cost of existing units. But in regional housing markets, the units that become less expensive may be far out on the suburban fringe, far from jobs and opportunity.

At a more local level, new development often creates upward pressure on housing costs because new housing is primarily built for higher-income residents. A 2015 study commissioned by the Wall Street Journal found that 82 percent of new rental housing in the US was luxury housing.* Not only do the new units have higher rents, but the new higher-income residents spend money in ways that create demand for more lower-wage workers in an area; this, in turn, creates more demand for housing in the area and ultimately raises housing costs.

Modest price increases in a region can translate into very acute increases in specific neighborhoods. The lower costs resulting from increased supply may be apparent only at the suburban fringe of the region, while new luxury housing may cause dramatic upswings in the price of residential real estate in central neighborhoods.


Policy Brief: Potential Dedicated Revenue Sources to Support Affordable Housing Production

This document briefly summarizes a variety of potential dedicated revenue sources to support affordable housing development, including taxes and fees, voter-approved bonds, debt and equity funds, and special purpose revenue districts. For each type, the matrix describes how the revenue source works, how it is implemented, its revenue generating potential, as well as some examples. View Policy Brief

Policy Map

PolicyMap provides a user friendly and graphical way to explore data about housing markets, the need for affordable housing, and the existing stock of affordable housing in every community. Visit PolicyMap

Paycheck to Paycheck

This tool makes it easy to compare wages and housing costs to visualize the challenge that American workers face in paying for housing. The database includes wage and housing cost data from 108 regions and 81 common occupations. Paycheck to Paycheck Tool