Preserve Affordable Rental Homes

What is rental housing preservation?

Rental housing preservation policies seek to ensure the continued, long-term availability of quality affordable rental homes — an essential part of the housing stock for working families, the elderly, people with a disability, and others. Across the country, hundreds of thousands of subsidized rentals, affordable to low- and moderate-income households, are at risk of being lost. Millions of unsubsidized rental homes that are affordable to moderate-income families are also at risk of becoming less affordable as rents rise and older properties are either upgraded to serve higher-income families or allowed to deteriorate. According to Harvard University’s Joint Center for Housing Studies, in the past decade more than 1.2 million of these units were lost — to escalating rents or condominium conversions in strong markets, to abandonment and demolition in weaker markets. [1]

There is no single “magic bullet” that can ensure that affordable rental homes are preserved. Rather, multiple, coordinated and flexible policies are needed to identify properties at risk (and in time to preserve their affordability), provide the resources needed to facilitate the rehabilitation and/or purchase of target properties, and create the incentives needed to encourage owners to preserve and improve their properties.

Why is rental housing preservation important?

Because the health, stability, and economic vitality of our communities depend on a mix of housing options. Nearly all of us are renters at some point in our lives — whether as a young person, a family moving to a new job opportunity, or a retiree living on a fixed income. Rental homes play an important role in our economy, and are as critical to our nation’s infrastructure as highways, transit systems, schools and industry.

The preservation of affordable rental properties allows working families, the elderly and others to live in stable environments and within their financial means. By helping to ensure the continued availability of affordable rental homes, preservation policies help families spend a reasonable amount on rent and utilities, leaving them better positioned to afford basic health and food costs and to save funds: for weathering the unexpected — loss of employment, medical issues, vehicle repairs, etc.; for expanding their economic opportunities — savings for education, training, etc.; or for a major purchase — such as the downpayment on a home.

Preserving existing rental properties helps to conserve billions of public dollars already invested in the affordable rental housing supply. For over 40 years, federal tax policy and housing programs have encouraged private owners and investors to develop millions of rental homes. These homes play a critical role in housing working families. Due to the high costs of construction, the strong competition for land that drives up land prices, and the limited availability of new federal rental subsidies, affordable rental homes that are lost are unlikely to be replaced through new construction. In most cases, it is also less expensive to preserve existing affordable rental homes than to build new ones.

The loss of stable affordable rental homes can mean upheaval in a neighborhood, displacement of long-time residents, and a loss of the community’s traditional character – particularly in communities where rents and surrounding property values are rising. Well-maintained rental homes that are affordable to working families and others can contribute to neighborhood stability, combat the negative effects of gentrification, and create or preserve diverse, mixed-income communities.

Solutions in Action

Hazel Hill Apartments in Fredericksburg, VA, a project-based Section 8 property built in 1971, had twice failed HUD inspections by 2004. As housing prices in the area soared, the owner faced foreclosure and the residents displacement.
The National Housing Trust/Enterprise Preservation Corporation acquired Hazel Hill in 2004 and conducted the renovations needed to save the property. NHT/Enterprise further improved the community’s quality of life by developing a resident services and community safety program.

Visit the Gallery for more information on Hazel Hill.

When existing rental homes are well-located near jobs and/or public transit, their preservation can also be helpful for improving the quality of life of residents and the surrounding community. Families living in such locations tend to experience lower transportation costs and automobile usage than families in more remote locations. This helps to reduce families’ transportation costs, energy usage, and commute time. The reduction in car usage also may help to ease congestion and traffic for others in the community.

Indeed, preservation is inherently “green” and environmentally responsible. The preservation of existing affordable housing produces less waste and uses less new materials and energy than new construction. Click here to leave this site and learn more about the environmental benefits of rental housing preservation.

Where are rental housing preservation policies most applicable?

Rental housing preservation initiatives can be applied in both strong and weak markets. While most rental housing preservation efforts focus on ensuring the ongoing affordability of properties with expiring federal or state subsidies, some communities are deploying resources to preserve unsubsidized affordable rental properties. Each year, a portion of this unsubsidized but affordable inventory is lost due to inadequate maintenance. Other unsubsidized units are lost when owners make substantial upgrades that in turn price the homes out of reach for working families.

Not every property can or should be preserved. Some properties are simply too physically deteriorated or financially unstable to be preserved. But much of the existing rental housing stock can be preserved as a quality, affordable housing resource. Simply put, affordable rental homes play a critical role in the nation’s housing stock. It is much more efficient to preserve this resource than to recreate it.

Learn more about rental housing preservation

 

Go back to learn about other policies that preserve and recycle resources for affordable homes

[1] Revisiting Rental Housing: Observations from a National Summit. [PDF] April 2007. Cambridge, MA: Joint Center for Housing Studies at Harvard University.

Note: The rental housing preservation section of HousingPolicy.org draws heavily on the experience and work product produced through the Window of Opportunity Initiative, sponsored by the John D. and Catherine T. MacArthur Foundation. The Center for Housing Policy particularly acknowledges our reliance on written materials prepared for this initiative by a Window of Opportunity policy working group that was facilitated by CFED. In addition, we gratefully acknowledge the input and feedback provided for this policy section by Michael Bodaken and Tracy Kaufman of the National Housing Trust, and Michael Torrens (CFED). Please note, however, that the views and opinions expressed on HousingPolicy.org are those of the Center for Housing Policy alone.

Leave a Comment