Another Approach to Affordable Housing

A new approach to affordable housing attempts to overcome the traditional approaches of supply-side economics and government-funded investments and extractions.

2 minute read

February 17, 2019, 5:00 AM PST

By James Brasuell @CasualBrasuell


Construction Cranes

Scruggelgreen / Shutterstock

Joe Cortright writes on the subject of a "third way" to build affordable housing—in addition to the traditional approaches of supply-side economics and public investment in affordable housing through subsidies and inclusionary zoning.

While acknowledging the importance of both methods of adding and preserving affordable housing, Cortright is amplifying news of a third way that doesn't conform to either of those approaches while acknowledging their shortcomings. 

[Washington, D.C. developer Rob] Stewart and his firm are working with the Federal City Council in Washington DC on a proposal they call the Washington Housing Initiative (WHI), which aims to create more affordable housing units, more quickly, in neighborhoods that are on the cusp of change. The essential idea is to use a combination of private investment and public funds to acquire existing housing, and maintain its availability for low and moderate income households. Buying existing housing units is dramatically less expensive that building new units, and can be done much more quickly.

And more:

WHI aims to have a lower cost of capital and lower operating cost that traditional affordable housing approaches. A key economy comes from taking a “fund” approach rather than a “project” approach to structuring financing.  In most affordable housing projects, funding is arranged on a project-by-project basis, with each project consisting of a different set of actors, and funding sources, and with the added complexity of construction financing and site-specific risk.  The WHI would be structured as a pooled fund, with financing not tied to individual projects, but spread across many projects. Because the fund is buying existing buildings, construction lending isn’t needed and other risk factors (approval or construction delays) are minimized. A fund, especially one led by private management, could be quick and nimble, and minimize overhead costs of acquiring properties.

There's a white paper that shares detail insights into the development as a potential model for projects in other locations.

Tuesday, January 29, 2019 in City Observatory

Aerial view of Eugene, Oregon at dusk with mountains in background.

Eugene Ends Parking Minimums

In a move that complies with a state law aimed at reducing transportation emissions, Eugene amended its parking rules to eliminate minimum requirements and set maximum parking lot sizes.

December 3, 2023 - NBC 16

Green Paris Texas city limit sign with population.

How Paris, Texas Became a ‘Unicorn’ for Rural Transit

A robust coalition of advocates in the town of 25,000 brought together the funding and resources to launch a popular bus service that some residents see as a mobility lifeline—and a social club.

November 30, 2023 - Texas Monthly

SMall backyard cottage ADU in San Diego, California.

San Diegans at Odds Over ‘Granny Towers’

A provision in the city’s ADU ordinance allows developers to build an essentially unlimited number of units on single-family lots.

November 29, 2023 - CALmatters

Mission Bay and Potrero Hill

San Francisco Approves Zoning Reforms to Avoid ‘Builder’s Remedy’

The county board of supervisors voted to approve zoning changes that bring it closer to compliance with state housing mandates.

7 hours ago - Reason

Aerial view of housingin Las Vegas, Nevada with desert mountains in background.

Where Are Millennials Moving to?

As the housing crisis rages on, four U.S. states are seeing high levels of new migration from young and middle-aged workers.

December 7 - Yahoo Finance

Aerial view of houses against partly cloudy sky in San Mateon County, California.

California Cities Cite Historic Preservation to Block Development

Are some cities using historic designations disingenuously?

December 7 - Mercury News

News from HUD User

HUD's Office of Policy Development and Research

New Updates on PD&R Edge

HUD's Office of Policy Development and Research

"Rethinking Commuter Rail" podcast & Intercity Bus E-News

Chaddick Institute at DePaul University

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.