As we’ve written previously, affordable housing is becoming a greater priority for economic development organizations because it affects talent attraction and retention. A new report from the Urban Institute prepared for the Washington, DC, region explicitly acknowledges, “Inaction on the challenges of housing affordability could ultimately undermine the region’s future economic growth and prosperity.”
In response, the report provides recommended actions and suggests a set of policy tools to meet the region’s housing needs. The policy tools include several types of incentives. For example:
- Incentivize current property owners to maintain low or moderate rents. Specifically, enact property tax incentives for preservation to reduce landlord costs in return for rent limits.
- Fund moderate to substantial rehab programs. For example, jurisdictions can offer tax abatements or incentives to help property owners reduce the cost of substantial renovations.
- Enact property tax incentives for preservation. Offer property tax reductions to owners in exchange for continuing to provide housing at below-market rents.
- Continue to offer property tax relief as an affordability incentive for rental production and to assist homeowners who are older and/or have disabilities.
- Support affordability and inclusion. Create developer incentives (waive fees, increase allowable density, or other incentives) in exchange for the production of low or moderate cost units.
- Increase the locations and density of housing development. Implement infill authorization or incentives such as property tax abatements or infrastructure improvements to put more parcels to use.
For context on the Washington region’s future housing needs and the review of all proposed policy tools, please see the full report: Meeting the Washington Region’s Future Housing Needs. A Framework for Regional Deliberations, Urban Institute, September 2019.