Creating Affordable Housing Opportunities in Austin: New Incentive Programs on the Horizon

Austin City Council, affordable housing, Affordability Unlocked, Median Family Income, housing incentives, Vanessa Fuentes, Ryan Alter

Smart Austin Concierge

June 7, 2023

The Austin City Council is exploring new ways to collaborate with local developers to increase affordable rental and homeownership opportunities in the bustling Texas city. Affordable housing in Austin is primarily based on developments that reserve units for residents earning a certain percentage of the local Median Family Income (MFI). Over the years, Austin’s MFI has surged, now standing at $122,300 for a family of four.

Instead of employing inclusionary zoning practices prevalent in other parts of the country, cities like Austin can only offer building trade-offs to entice developers to include income-restricted units in their plans. Austin has used various incentives to promote affordable housing alongside market-rate and luxury units, with diverse outcomes.

Two City Council members have drafted proposals to improve these programs, aiming to foster more affordable living spaces across different types of development. Council Member Vanessa Fuentes is seeking to expand Austin’s current Affordability Unlocked development bonus program, which was established in 2019. Council Member Ryan Alter, on the other hand, is proposing a new bonus program specifically targeting ownership housing within existing single-family areas.

Affordability Unlocked offers waivers for specific development standards, permitting denser or taller projects if a significant number of units are income-restricted. Fuentes’ update would introduce a new median tier that demands less affordable housing than the current tiers but more than some of Austin’s other existing bonuses.

In a statement, Fuentes declared, “By creating affordable housing incentives without the use of city subsidies, we’re taking a proactive stance in addressing housing market failures, saving taxpayer money, and implementing solutions that bring us closer to a more affordable and accessible Austin.”

Alter’s proposal aims to promote more affordable for-sale projects through a new potential bonus program focused on housing within residential areas. The plan is still in its infancy and would require months of staff review before a finalized program is open for approval.

As Austin continues to flourish, the need for affordable housing solutions becomes more critical. With the aid of innovative programs like Affordability Unlocked, the city is taking strides to ensure a more inclusive and accessible housing market for all residents. Check out our comprehensive Austin Relocation Guide to make your move to Austin seamless and stress-free. If you have further questions regarding the Austin housing market or local lifestyle, our Smart Austin Concierge, a professional AI chatbot, is ready to assist you by granting access to current market data and our entire article database! Get in touch with us at 512-710-0337 or send an email to concierge@smartaustinrealty.com for personalized guidance through Central Texas living and real estate matters.