“While building affordable housing is a hot topic, new buildings only account for about a quarter of the affordable housing market. The rest is comprised of Naturally Occurring Affordable Housing, or NOAH, which falls between subsidized housing and high-rent buildings. However, that too is that risk. In Chicago, 10% of NOAH housing was lost from 2012-2019.
“One Chicago CDFI has been working to preserve that housing for decades. Called Community Investment Corporation (CCI), they have a wide range of programs, including their Troubled Building Initiative, to support the acquisition, rehabilitation and preservation of affordable rental housing.
“CEO Stacie Young says they started in the ’80s by creating access to credit for primarily local owners to buy and rehab multi-family housing in historically disinvested neighborhoods, as well as for small-business owner acquisitions. They did this in part by creating funding pools of lenders with a shared-risk model. Now, they have $330 million dollars of loan capital committed by 40 lenders to preserve naturally affordable rental housing.
“They also offer a suite of services to support and educate the landlords who borrow from them, including training on best practices, resources and building code updates. The goal is to help landlords serve as better stewards of affordable buildings. Young says a survey found that half of their borrowers are people of color, and many are local.
“‘We usually don’t think about landlords as businesses, but they are,’ Young says. ‘They need the same support.’
“Their 20-year-old Trouble Buildings Initiative (TBI) is aimed at unresponsive landlords. Instead of the city of Chicago filing code violations, TBI pulls together multiple city departments including housing, police and building, to identify at-risk structures and appoint CIC as a stakeholder to make repairs.
“One notable product of this multi-org collaborative is tax relief for multi-family housing which incentivizes low- to moderate-income owners to improve buildings while keeping them affordable. This is critical to preserving more locally-owned NOAH stock as national markets face speculation from aggressive investment groups without stake in community stability.
“Here in Chicago, we’re looking at rents of $800-$900 a month for neighborhoods without subsidy,” Young says. “And in higher-cost neighborhoods, they’re going up to $1,200-$1,700 a month. This tax incentive is a way for owners to keep rents affordable in those higher-cost markets where the rents are going up.” (Patterson, Urbanist News, 6/8/22)
When Preserving Affordable Housing Is Cheaper Than Building It; This Chicago CDFI is taking a multi-faceted approach, from political advocacy to landlord training, to keep the city’s dwindling affordable housing supply, Hadassah Patterson, Urbanist News, 6/8/22