Preserving And Constructing Affordable Housing That Is Appropriately Targeted To Existing And Future Vulnerable Residents
Goal 2A: Preserving the Existing Affordable Housing Stock in Gentrifying Neighborhoods
i. Affordable Housing Preservation Network
In the City of Dallas, we are currently losing affordable housing units far faster than we are replacing them, and we are projected to lose many more in the coming years. According to data published in the spring of 2023 by the Child Poverty Action Lab (CPAL), the City of Dallas currently has a 33,660-unit rental supply gap for households earning 50% of the Area Median Income (AMI) and below.29 By 2030, that gap is expected to grow to 83,500 units. A key driver of the widening gap is a projected loss of almost 54,000 units of naturally occurring affordable housing (NOAH),30 representing an 87% decrease in existing supply. In gentrifying neighborhoods, these affordable housing units are especially difficult to maintain and preserve, given rapidly rising property values and owners’ desire to maximize potential ground rents.
To support the preservation of affordable housing in gentrifying neighborhoods with high concentrations of multifamily apartment complexes, the City can facilitate the establishment of an affordable housing preservation network to collectively monitor and track at-risk multifamily properties and collaborate on preservation strategies including property acquisition and rehabilitation.
The City can do this through dedicating staff time and resources to coordinate preservation efforts and regularly convene the preservation network, creating and managing a citywide database to track at-risk properties, adopting a right-to-purchase ordinance, and establishing a public-private strike fund for acquisitions. Public corporations such as the Dallas Public Facilities Corporation (DPFC), Dallas Housing Finance Corporation (DHFC), and the new Dallas Economic Development Corporation (DEDC) can also play key roles in preservation strategies by prioritizing the acquisition, rehabilitation, and long-term affordability of both previously subsidized and naturally occurring affordable housing developments.
The creation and maintenance of a comprehensive database to track at-risk properties is a critical tool in any preservation effort. This database should include detailed information regarding key indicators of vulnerability including expiring subsidies and land use restrictions, building conditions, code violations, and any other habitability concerns sourced by stakeholders on the ground. Detailed data provides preservation-minded organizations with key insights into which affordable properties may be most at risk of redevelopment and which would be the best candidates for preservation.
The City can also assist preservation efforts by adopting a right-to-purchase ordinance granting government agencies, tenant associations, and preservation organizations purchase rights and rights of first refusal to acquire at-risk properties. A purchase right typically affords preservation-minded organizations the right to purchase properties exiting existing affordability programs at fair market value, while a right of first refusal (ROFR) provides the right to match a private offer to purchase during a set timeframe. Both can extend to all multifamily complexes, regardless of whether they previously participated in any affordability program. Washington, D.C., and Chicago are examples of cities with comprehensive preservation programs and right-to-purchase ordinances.
Finally, the City can further support preservation efforts by establishing a public-private strike fund to offer quick, flexible, and low-cost financing to preservation organizations for acquisitions and rehabilitation. These funds, often referred to as “strike funds” or “layered funds” combine public, private, and philanthropic dollars, creating a structure that allows for greater flexibility than typical government subsidy programs.
ii. Enhanced Legal Protections for Vulnerable Tenants
Gentrifying neighborhoods across Dallas are experiencing an influx of new, intrusive, and incompatible housing development that is threatening the residential and cultural character of these vulnerable communities. It is a common sight in many of these neighborhoods to see brand-new, three- or four-story “McMansion”-style homes towering over 50-year-old single-story wood frame structures. The juxtaposition is jarring to any observer. Existing zoning tools and regulations such as Neighborhood Stabilization Overlays (NSOs) or Conservation Districts have unfortunately not proven effective in these vulnerable communities. Both are overly cumbersome to establish and maintain, and the NSO specifically has limited regulatory authority.
To remedy this, the City of Dallas should create a new displacement mitigation zoning overlay to preserve and stabilize the physical and built character of rapidly gentrifying single-family neighborhoods with high concentrations of naturally occurring affordable housing (NOAH) that are at increased risk of teardowns and redevelopment. This new zoning overlay should incorporate design standards that draw from the existing residential development in the area to regulate height, square footage, and roof type, at a minimum. It can also consider the inclusion of porches and garage placement, where appropriate to preserve neighborhood character. The City Council has already taken steps toward this goal by adopting specific displacement mitigation overlay policy language in its updated comprehensive land use plan, ForwardDallas 2.0, and through the consideration of similar language and tools in its development of the South Dallas/Fair Park Area Plan.
iii. Targeted Home Repair Programs (see Goal 1Biii)
As discussed in the previous section, targeted home repair programs are an incredibly effective tool both in preventing the direct displacement of vulnerable homeowners and in preserving the existing stock of naturally occurring affordable housing units within rapidly gentrifying neighborhoods. (See Goal 1Biii for more.)
Goal 2B: Creating New Affordable Housing Options to Serve Current and Future Vulnerable Households in Gentrifying Neighborhoods
i. Strategic Land Banking
When done appropriately, land banking for affordable housing can be a powerful tool for mitigating residential displacement in neighborhoods experiencing and/or susceptible to gentrification. In areas with rapidly rising land values or where land values are anticipated to rise, acquiring land early and removing it from the speculative real estate market protects the possibility of future affordability in those areas. Land banking programs are most effective when they are coupled with public land for affordable housing policies (see Goal 3Bii), right-priced affordable housing policies (Goal 2Ci), and shared equity housing models (Goal 3Ci), all of which help ensure the programs are successful in creating and preserving long-term affordable housing units that meet the needs of vulnerable residents and neighborhoods.
The City of Houston serves as an example of effective strategic land banking for long-term affordability and neighborhood transformation and stabilization. The Houston Land Bank (HLB) thoughtfully and strategically acquires, stewards, and conveys vacant, abandoned, and damaged properties and facilitates the development of affordable housing to support community and economic development in historically underserved Houston neighborhoods. Partnering with the City of Houston’s Housing and Community Development Department and Houston Community Land Trust, the HLB prioritizes the sale of new homes to households earning 80% of the Area Median Income (AMI) and below. The HLB also actively assists in the assessment, cleanup, and redevelopment of brownfields sites in historically underserved communities, offering free assessments and planning support for proposed brownfields redevelopment projects – costly endeavors that often place debilitating burdens on nonprofit and affordable housing developers here in Dallas.
The City of Dallas can better utilize its existing land bank program, the Dallas Housing Acquisition and Development Corporation (DHADC), to further anti-displacement goals by adopting a strategic land banking policy that prioritizes the acquisition and land banking of vacant lots in gentrifying neighborhoods.
This policy should also consider the acquisition of aging homes that come up for sale and placing them in a Community Land Trust (discussed more in Goal 3Ci). Additionally, the creation of a Land Acquisition Fund could support this strategy by facilitating the DHADC’s swift acquisition of lots.
ii. Public Land for Affordable Housing Policy
The City of Dallas and other public entities including Dallas Area Rapid Transit (DART) and the Dallas Independent School District (DISD) have significant land holdings in numerous neighborhoods experiencing or susceptible to gentrification. Without an explicit policy setting this land aside for affordable housing, it could potentially be sold and developed for uses that exacerbate rather than mitigate existing displacement pressures for vulnerable residents.
To circumvent this, the City of Dallas should adopt a Public Land for Affordable Housing Policy that prioritizes the construction of long-term and deeply affordable housing on publicly owned land to serve vulnerable residents in gentrifying neighborhoods. This policy should set clear and enforceable standards regarding specific income targets and the minimum amount of affordable housing that must be included on redeveloped parcels of publicly owned land. It can also consider the incorporation of neighborhood-based restrictions to meet community-identified needs such as tenant protections for rental properties and preference policies for specific priority groups such as voucher holders or legacy residents.
iii. Comprehensive Density Bonus Program
The recent adoption of the City’s new comprehensive land use plan, ForwardDallas 2.0, has stirred up both significant excitement and trepidation around the idea of increased density in residential neighborhoods and what it could potentially mean for housing affordability. Many housing advocates and “YIMBYs”31 have championed increased density, parking reductions, and the general deregulation of zoning and land use laws as the primary policies for making housing more affordable in Texas. However, a recent report published by Texas Housers shows that increased density and land use deregulation alone are likely insufficient to address the housing affordability needs for the majority of cost-burdened households in Texas and that additional funding and programs are needed to support low-income and cost-burdened residents across the state. Through an anti-displacement lens, increased density and residential “up-zoning” can also contribute to gentrification and displacement pressures by increasing land values, incentivizing the teardown of naturally occurring affordable housing units, and changing the physical and built character of an established neighborhood.
For these reasons, we advocate for tying density to deed-restricted affordability requirements to ensure that a portion of newly constructed units are sold or rented to low- to moderate-income households. In gentrifying neighborhoods where land values are rapidly increasing and affordable housing becomes more expensive to build, density bonus programs that require the inclusion of income-restricted affordable housing in exchange for increased zoning and land use entitlements can leverage the power of accelerating housing markets to include affordable units in otherwise market-rate developments. When structured properly, density bonuses can be an effective tool in creating more affordable units and more mixed-income housing overall.
The City of Dallas currently has a density bonus program for multifamily housing called the Mixed Income Housing Development Bonus (MIHDB), but no program currently exists for single-family developments. The City can better address the affordable housing needs of vulnerable families in gentrifying neighborhoods by establishing a single-family density bonus program to ensure that new housing development projects seeking increased zoning and land use entitlements in gentrifying neighborhoods are appropriately priced for low- and moderate-income families. The City Council recently approved policy language to create such a program in ForwardDallas 2.0. In addition to establishing a new single-family density bonus program, the City should also take steps to strengthen and expand its existing MIHDB program to better serve more vulnerable residents at lower income levels.
Goal 2C: Ensuring that Affordable Housing Programs Appropriately Serve Existing and Future Vulnerable Residents
i. Right-Priced Affordable Housing Policy
According to the 2023 study from the Child Poverty Action Lab (CPAL) referenced earlier in this section, Dallas currently has a 33,660 rental unit supply gap for its lowest-income households – those earning 50% of the area median income (AMI) and below. There is currently no supply gap for households making above 50% AMI, although city programs continue to prioritize households making up to 80% AMI and above for rental subsidies. A recent report on housing affordability from the Texas Comptroller affirmed the need for “more funding for low- to moderate-income housing programs and incentives to increase the supply of housing at the price range where it is most needed.”
To better serve its most vulnerable residents and ensure that public subsidies align with demonstrated needs, the City of Dallas should adopt a Right-Priced Affordable Housing Policy for all city housing programs that would lower existing income targets to prioritize households earning 50% AMI and below for rental units and 80% AMI and below for homeownership units.
ii. Targeted Marketing Of Affordable Units To Vulnerable Residents
Intentional outreach and targeted marketing of affordable units to vulnerable residents in gentrifying neighborhoods can greatly increase the ability of these residents to become aware of and apply for existing vacancies in their neighborhoods, mitigating community displacement.
The City of Dallas should require targeted marketing plans for all units in city-subsidized or incentivized housing developments to ensure that vacant affordable units in gentrifying neighborhoods are strategically marketed to vulnerable residents while complying with fair housing requirements.
iii. Community Preference (“Right To Return”) Policy
As discussed in the previous section, Community Preference Policies are useful tools in preventing the displacement of existing vulnerable residents and ensuring their right to stay in their communities, as well as creating the opportunity for previously displaced residents and their descendants to return. (See Goal 1Aiv for more.)