City eyes strategy shifts to address affordable housing shortfalls

City staff members are evaluating the idea of investing more in housing as well as other strategies to address shortfalls in key areas of the Strategic Housing Blueprint, including deeply affordable housing and permanent supportive housing.

A memo released this week looks at progress related to the 2023 Austin Strategic Housing Blueprint Scorecard and shows the city has exceeded targets in housing preservation and development near transit corridors. It also shows that significant gaps remain in housing for residents earning below 60 percent of the median family income and in the geographic distribution of income-restricted units across all City Council districts​.

To close these gaps, city staff is preparing to revise the blueprint based on current market data and affordability trends.

The expected updates include:

• Revising the blueprint based on new housing market data, since the original goals were set using studies from the mid-2010s. The memo acknowledges that the housing landscape has changed significantly, with home prices rising by 58 percent since 2017 and rents remaining high despite recent dips.
• Updating the “opportunity index,” a tool used to evaluate where income-restricted housing is located in relation to access to economic opportunity, schools, transportation and services. The update is intended to better align future affordable housing development with equity goals​.
• Developing new zoning tools to support “missing middle” and urban mixed-use housing types to make it easier to build a wider variety of housing in neighborhoods where current land use regulations may limit density or affordability​.
• Preserving affordability near light-rail investments by directing resources and incentives to areas where displacement pressures are expected to increase due to upcoming transit infrastructure​.

A $6.7 million federal grant from the U.S. Department of Housing and Urban Development’s PRO Housing program would cover the cost of those activities over a six-year period, but several tranches of federal grant money have been put on hold or have become uncertain because of ongoing budget cuts.

The Housing Department is expected to present a detailed work plan for the update in an upcoming Housing and Planning Committee meeting.

Some policy shifts already under discussion include enhancing the city’s density bonus programs, recalibrating income thresholds and standardizing affordability periods across project types. A January planning memo acknowledged that while more than 46,000 units have been produced through density bonuses, many programs remain inconsistently applied or underused in parts of the city with limited affordable housing stock​.

The 2023 scorecard reported the highest single-year output of affordable units since the blueprint’s adoption in 2017, with 4,926 units affordable to households earning 80 percent or less of the MFI. Only 63 new “deeply affordable” units were built for households at or below 30 percent MFI, leaving a sizable community underserved since that income group makes up 17 percent of Austin’s population.

The scorecard also found income-restricted housing in high-opportunity areas rose to 16 percent, an improvement from prior years but still short of the 25 percent target​.

Related to geographic distribution, the scorecard found that District 8 and District 10 had only 37 affordable homes included in the 1,568 homes built in the one-year period studied. Districts 2, 4 and 1 were found to have more than met the city’s annual goal for the creation of affordable homes.

Affordable housing advocates argue the progress in new-home creation is not reaching the most vulnerable residents.

“What this means in simplest terms is that the city is prioritizing housing for people making $100,000 or more, while extremely low-income Austinites making less than $25,000 can’t afford rents and are getting left behind,” Cate Graziani, co-director of VOCAL-TX, said in a statement following the Scorecard’s release.

VOCAL-TX recently launched a new campaign titled Housing Access Now: Stop Discrimination and Start Affordability, aimed at eliminating barriers to housing for individuals with criminal records and pushing for an increase in deeply affordable housing stock. Graziani emphasized the connection between early housing access and preventing chronic homelessness, arguing that the city must “rightsize our housing plan to meet the need,” particularly in light of anticipated federal budget cuts.

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