Affordable housing in the United States

The term "affordable housing" refers to housing that is considered economically accessible for individuals and families whose household income falls at or below the Area Median Income (AMI), as evaluated by either national or local government authorities through an officially recognized housing affordability index.^[3] However, in the US, the term is mostly used to refer to housing units that are deed restricted (for typically at least 30 years) to households considered Low-Income (80% of AMI), Very Low-Income (50% of AMI), and Extremely Low-Income (30% of AMI). These units are most often constructed by non-profit "affordable housing developers" who use a combination of private money and government subsidies. For-profit developers, when building market-rate developments, may include some "affordable" units (often 10-30%), if required as part of a city's inclusionary zoning mandate.

For over six decades, housing has consistently been the largest expenditure within the average American family's financial plan. Throughout a substantial portion of this era, housing expenses have outpaced income growth, especially impacting those who rent their residences.^[4] Following the Great Recession in 2008, there has been a substantial decline in the rate of home ownership, leading to increases in foreclosures and short sales. This, in turn, has driven a surge in the number of individuals and families opting to rent homes, causing greater rental expenses.^[5]

The National Low Income Housing Coalition (NLIHC) released its annual report, Out of Reach: The High Cost of Housing in June, 2023. This report underlines the disparity between people's earnings and the cost of modest rental housing across the U.S. It emphasizes how rising rents, coupled with the end of COVID-19 pandemic-era support programs, are intensifying financial instability for low-income renters. The report's key figure, the "Housing Wage," reveals the hourly earnings necessary for full-time workers to afford fair market rental homes without exceeding 30% of their incomes. Nationally, the 2023 Housing Wage is $28.58 per hour for a modest two-bedroom home and $23.67 per hour for a one-bedroom home. The findings emphasize that housing remains unaffordable for workers across various job types and income levels. Sixty percent of workers earn less than the hourly wage required for a two-bedroom home, and nearly 50% earn less than the one-bedroom Housing Wage.^[6]

Some of the main issues which lead to the need for affordable housing are homelessness, the housing affordability crisis,^[7] and historic housing discrimination against people of color. The reported effects of affordable housing range from improved health and educational outcomes to reduced homelessness.^[8] A series of legislative steps have been taken to address different aspects of housing policy in the United States, including the National Housing Act of 1934,^[9] Housing Act of 1937,^[10] Housing Act of 1949,^[11] and Fair Housing Act of 1968.^[12] Together, these acts represent a progression of federal housing policy, from facilitating mortgage insurance and creating public housing options to emphasizing the importance of affordable and equitable housing opportunities while also addressing discrimination and promoting fair housing practices. Government policies and programs, such as subsidized housing, tax incentives, and inclusionary zoning, coupled with innovative solutions, such as tenant protections, mixed-income developments, and homeownership programs, have contributed to shaping the affordable housing landscape in the United States.