June is recognized as national homeownership month by the Department of Housing and Urban Development-HUD. Owning a home is part of the American dream. Homeownership brings stability to families along with economic growth to the country. It gives voice and visibility to those often overlooked.
Somehow making housing affordable for families that earn lower incomes has become stereotyped with it being another government handout. In Peoria, when affordable housing development projects are proposed to areas outside of 61605, neighbors, public officials, and local residents oppose it. Especially when the term low income is used. Some of the concerns from residents and city officials opposing affordable housing development range from fear there will be an increase in crime, a decrease in property value to an increase in demands on municipal services. Most of these claims often are masked by underlying biases and ignorance. The word nimbyism comes to mind. Not in my back yard.
Affordable housing and low-income housing are different even though the words are used interchangeably. Affordable housing is housing that is affordable to households with income at or below what HUD classifies as median income. The area median income for Peoria is $89,900. A household or individual that earns 50% or 80% of the area median income is considered low income. So, a two-person household that earns $34,150 (by HUD’s definition, they are considered low income) and spends $854 or less a month for rent or mortgage payments is considered paying affordable housing. Or, if that two-person household earns $54,600 (low income by HUD’s guidelines) a year and spends $1,365 a month for rent or mortgage payments, their housing is affordable. Federal low-income housing is subsidized programs that provide rental assistance to households who cannot afford to rent an apartment. Most of these households earn less than $20,500 a year.
Receiving government assistance to build affordable housing is nothing new in this country or city. The federal government has been in the business of providing subsidies to help households buy land and build homes as far back as the 1862 Homestead Act. FHA (now Fannie Mae and Freddie Mac) was created to help banks when they didn’t have money to lend and people didn’t have jobs to buy homes during the great depression. When millions of veterans returned home from World War II, there was an extreme housing shortage. The GI bill provided federal subsidies to veterans returning home from the war to purchase a home, get a job, or go back to school. Developers also received numerous financial incentives to build affordable housing in locations not considered urban areas for these returning veterans. The 1949 Housing Act was created to eliminate blight in urban cities. With the GI bill, so many were leaving the city and moving to the suburbs. Until the Fair Housing Act was passed in 1968, African Americans could not get a loan from a bank to purchase a home because of discrimination.
History has a way of always repeating itself. Demand for affordable housing is at an all-time high, and low-income households can’t afford the rent it costs developers to construct. Federal programs like low-income tax credits and grants were created to bridge the gap between what it costs developers to build and what they can sell or rent for.
With the extreme housing shortage this country is facing, federal programs are available to help everyone regardless of race, gender, or familial status. People with the loudest voice against affordable housing in their zip code are probably still living in areas built with the GI bill.