About The Housing Credit

The Low-Income Housing Tax Credit (Housing Credit) is our nation’s primary tool to create and preserve affordable rental housing.

• Since its inception in 1986, the Housing Credit has financed the development of 3.7 million affordable rental homes in urban, suburban, and rural areas, according to the National Council of State Housing Agencies.
• In 2019 and 2020, the Housing Credit produced or preserved roughly 130,000 homes annually, meaning no other local, state, or federal program comes close to its level of production, according to CohnReznick.

The Housing Credit serves millions of households in need.

• In total, the Housing Credit has housed over eight million low-income households, including veterans of the armed forces, senior citizens, formerly homeless families and individuals, people recovering from opioid addiction, people with disabilities, and low-wage workers.
• The median income for households living in Housing Credit properties is less than $18,200, and approximately 52 percent of households are extremely low-income, making 30 percent or less of the area’s median income, according to the Department of Housing and Urban Development. If forced to pay market-rate rent, many of these households would be just one unforeseen event away from losing their housing.

The Housing Credit generates jobs, economic activity, and tax revenue.

• Since 1986, the Housing Credit has supported over 6 million jobs and generated over $688 billion in wages and business income, as well as $239 billion in tax revenue, according to research by the National Association of Home Builders presented here.

Housing Credit properties are high-quality and financially stable.

• Due to strong private-sector oversight stemming from the Housing Credit’s public-private partnership model, Housing Credit properties are built to durable, high-quality standards.
• The process of bringing Housing Credit properties to fruition is often facilitated by syndicators, who act as intermediaries that provide critical underwriting, asset management and oversight functions to assure that developments supported by the Housing Credit remain fiscally sound and affordable for low-income Americans.
• Housing Credit properties have a high occupancy rate – over 97 percent – showing a very strong demand for Housing Credit homes, according to CohnReznick,
• Also according to CohnReznick, the total foreclosure rate for all Housing Credit properties is only 0.57 percent, which is lower than any real estate asset class. In fact, there was only one new reported foreclosure in 2020, despite the challenges of COVID-19.

The Housing Credit works in all types of communities.

• The Housing Credit allows states to set their own affordable housing priorities and to award Housing Credits based on those priorities, e.g. housing for special populations, like seniors or veterans, or housing in specific regions, like rural areas.
• Housing Credit properties are built in large and small urban areas, suburban communities, rural towns, and on tribal land. Roughly 22 percent of properties are in nonmetropolitan counties, where it has historically been challenging to develop affordable housing, according to CohnReznick.
• The Housing Credit has also been important for communities recovering from natural disasters – from California wildfires to Hurricane Katrina to the floods in Iowa.

The Housing Credit is needed to address the affordable housing crisis.

• There is a vast and growing demand for affordable housing. More than 10 million low-income households spend more than half of their monthly income on rent, cutting into other essential expenses like childcare, medicine, groceries, and transportation, according to Harvard’s Joint Center for Housing Studies.
• Meanwhile, there is a growing shortage of affordable housing. For every 100 extremely low-income households, there are only 33 affordable homes available. In total, there is a shortage of 7.3 million rental homes affordable and available to renters with extremely low incomes (making 30 percent of area median income and below), according to the National Low Income Housing Coalition.

The Housing Credit can and should serve even more households.

• Virtually no new affordable rental housing can be built without the Housing Credit, because it is financially infeasible to do so. However, the Housing Credit is limited by the amount of credits available, which is set by Congress. Congress should expand and strengthen the Housing Credit to provide more affordable homes across the country.
• Advocate for the Housing Credit today by asking Congress to pass the Affordable Housing Credit Improvement Act of 2021, legislation that would provide two million more affordable homes by expanding and strengthening the Housing Credit, and see more ways to advocate here. Become an AHTCC member to join our advocacy efforts.

Learn how the Housing Credit works here.