The poorest in the US can't find housing even as low-income units sit
empty
[September 08, 2026] By
CLAIRE RUSH
PORTLAND, Ore. (AP) — Mathew Davis, who lives in a homeless shelter in
Austin, Texas, would love an apartment of his own. But with the little
money he makes donating blood plasma, even a $450-a-month tiny home with
no running water and a communal bathroom would be a stretch.
Meanwhile, over 4,500 units the city classifies as affordable — nearly
16% — sit empty.
“I don’t make enough money really to afford anything,” Davis, 49, said
of the few hundred dollars he earns a month. “I just keep trying to swim
uphill.”
The poorest people in the U.S. face the most acute shortages of
affordable homes. But the majority of low-income housing financed in
recent years is for those earning 50% of an area’s median income or
above, according to a survey of state housing agencies.
Some cities are now seeing an uptick in vacancies as rents for these
units approach market rates. The result: Apartments designated as
affordable sit empty because the poorest of the poor cannot afford them.
Meanwhile, some people are forced into homelessness and others into
desperate circumstances to pay for housing they can’t afford.
The poorest have few housing options
There are only about 4 million affordable rental units available for the
country’s 11 million extremely low-income renter households, according
to the National Low Income Housing Coalition’s most recent annual
report.
These are people with annual incomes either below the federal poverty
guidelines — just under $16,000 for a single-person household — or 30%
of the median income in their area, whichever is higher. They comprise
about a quarter of U.S. renter households, and include many people
working low-wage jobs, seniors and those with disabilities living on
fixed incomes.
About three-quarters of extremely low-income renter households pay over
half their income on rent and utilities, the report said, leaving little
leftover for other necessities.
Yet homes set aside for these renters were only about 12% of the
affordable housing units financed in 2024 by the Low-Income Housing Tax
Credit — a federal program providing tax credits to developers in
exchange for keeping rents low for at least 30 years, according to
figures from the National Council of State Housing Agencies.
The majority are for those earning at least 50% of an area’s median
income, or AMI. In Austin, that’s a single person earning roughly
$47,000 a year, as compared with an extremely low-income person earning
under $28,000.
The program has financed nearly 4 million affordable units nationwide
since its creation 40 years ago. But some experts say it’s inefficient —
and more costly than housing vouchers.
“It’s enormously complex and bureaucratic, and it raises the cost of
construction enormously because the rules are so complicated,” said
Chris Edwards, an economist at the Cato Institute, a libertarian think
tank, who told Congress the program’s complexity “spawned” an industry
of law and accounting firms just to administer it.
“If you’re going to subsidize affordable housing, you should give the
money directly to tenants,” he said, referring to housing vouchers.
Other experts say the two programs work together well because properties
built with the tax credit are required to accept vouchers — while
landlords of market-rate apartments in many states are not.
Still, there’s a major federal funding shortfall: Experts estimate only
one-in-four eligible families ever receive vouchers. Vouchers can help
the poorest pay for housing that’s targeted to higher income groups, but
the waitlist can be yearslong.
Some affordable housing developers say that without vouchers, it’s not
economically feasible to provide units for extremely low-income people.
True Ground Housing Partners, an affordable housing developer in the
Washington, D.C., area, gives an example: A unit for those earning 60%
of the area’s median income — nearly $70,000 a year — brings in $1,715
per month in rent. But after $1,575 in mortgage and operating expenses,
only $140 is left.
“The math does not lie,” said president and CEO Carmen Romero, noting
that an extremely low-income person would pay only half that rent.
“Our expenses don’t make it really possible to create a 30% AMI unit,
unless there was this extraordinary amount of subsidy that just doesn’t
exist.”
[to top of second column] |
A person sweeps outside during the grand opening of the Rose
on Colfax, a new affordable housing community with a co-located
childcare center in the East Colfax neighborhood, Jan. 24, 2024, in
Denver. (AP Photo/David Zalubowski, File)
 Affordable housing competes with
market-rate rents
Meanwhile, affordable housing rents for 60% AMI units are
approaching those of market-rate apartments in U.S. cities like
Austin, Denver and Portland, Oregon.
As a result, some people are opting to pay a bit more for
market-rate apartments with less income-verification and faster
approval — leaving growing numbers of affordable units vacant.
In Austin, the vacancy rate for all affordable housing is nearly 16%
with over 4,500 vacant units, according to real estate data and
analytics firm CoStar. A healthy vacancy rate is around 5%.
LDG Development, an affordable housing developer, cited a 12%
vacancy rate for its 60% AMI units in Austin. Chief portfolio
officer Rebekah Fischer said LDG is “in direct competition” with the
thousands of new market-rate apartments recently built in Austin.
“I have to have every bank statement, every pay check, every bill,
every Venmo transaction that you had with your friends,” Fischer
said of affordable housing applicants.
“When we’re almost going after the same renter, you can be approved
within two minutes at a market-rate deal, where unfortunately in
affordable housing … it takes time.”
In Denver, there’s a 13% vacancy rate among 60% AMI units financed
by the federal tax credit program — and a 21% vacancy rate for 80%
AMI units, according to the Colorado Housing and Finance Authority.
Meanwhile, there is far too little housing for the city's poorest.
In Portland, where there is also a housing shortage for the lowest
income groups, there are over 1,700 vacant affordable units for an
overall vacancy rate of 7.5%, according to the Portland Housing
Bureau. Most are for those earning 60% AMI, or about $54,000 for a
single-person household, with rent capped at $1,444 per month.
That’s close to the average rent of $1,581 for a one-bedroom
market-rate apartment, according to CoStar figures shared by the
bureau.
Portland resident Jaiden Barbee earns around 55% of the area median
income and is on waitlists for affordable housing. But, he says,
he’d pay more for a market-rate apartment to avoid the lengthy
application process.
“I’d rather spend the $200 extra just to get into a place easier
that’s wherever I want” and doesn’t have “all these hoops,” he said.
‘I want to shut the door at night and sleep’
Austin officials set a goal of building 20,000 units between 2018
and 2027 for extremely low-income people — 17% of the city’s
households.
Just 543 were built as of 2024, city documents show.
Meanwhile, all 15,000 units planned for those earning between 60%
and 80% of area median income were built.
In response to questions from The Associated Press, the Austin
housing department said it recognized the need to do more to produce
housing for the poorest people and was taking steps to do that,
including giving preference to funding proposals that include 30%
AMI units.
For Davis, who lived in his car for a year before getting a bed in
the Austin shelter, the housing shortage for people like him is
frustrating.
“I want to shut the door at night and be able to sleep,” he said. “I
really just want to find the right place.”
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Former AP writer Charlotte Kramon contributed.
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