What does affordable housing mean in Washtenaw County?

With several affordable housing developments on the way in our community, it's important to look at what this term can mean, barriers to housing affordability, and what's being done about it. 
In any discussion of the several affordable housing developments on the horizon in Ann Arbor and Ypsilanti, someone invariably asks the question: "Affordable to whom?" This is not an unreasonable question, as the term "affordable housing" can mean many different things to different people. With several affordable housing developments on the way in our community, it's important to look at what this term can mean, barriers to housing affordability, and what's being done about it. 

What is affordable housing?

The United States Department of Housing and Urban Development (HUD) defines "cost burden" as monthly housing costs that exceed 30% of the resident's take-home income. Many people use the inverse of this – housing that costs no more than 30% of the household's take-home income – to define affordable housing. This means that affordability depends on income. 

"Affordable housing to someone that works at Wendy's or McDonald's is going to be very different than to someone that is a CEO of a corporation," says Arthur Thomas, a member of the Ann Arbor Renter's Commission and Ypsilanti resident. "That term, affordable housing, is a tricky phrase. … You have to be more specific. Affordable to whom?" 

Jennifer Hall, director of the Ann Arbor Housing Commission, says one emerging definition of affordability also includes travel costs. This school of thought holds that a household is cost-burdened if its members pay more than 45% of their gross income on housing and transportation combined. 

"Ann Arbor is a good example of where that definition might come into play because when you've got a tight housing market, people tend to live farther and farther away," Hall says. "So it can make sense to add these two things together." 
Huron Vista and The Residences at Huron on W. Clark Rd. in Ypsilanti.
What does affordability look like by these metrics in Washtenaw County? According to HUD, the 2022 median income in Washtenaw County was $82,500 for a household of one and $117,800 for a household of four. This translates to a maximum total monthly housing cost of $2,063 for a household of one and $2,945 for a household of four making median income. Factoring in the transportation affordability measure that Hall outlines, the monthly affordability limit rises to $3,094 for a household of one or $4,417 for a household of four.

However, median income varies dramatically across the county. According to the U.S. Census Bureau the median household income in Ann Arbor between 2018 and 2022 was $78,546 (representing a housing affordability limit of $1,964 per month) while the median household income in Ypsilanti during the same time period was $41,914 (representing a housing affordability limit of $1,048 per month). Median monthly rent during the same time period was $1,472 in Ann Arbor and $977 in Ypsilanti. While both cities' monthly rents are technically affordable for their residents, Ann Arbor incomes leave a much more comfortable buffer to cover rent in the city, and Ann Arbor rents are extremely unaffordable for those living on an average Ypsi income. When you incorporate transportation costs, especially given that many Ypsi residents work in Ann Arbor, Ypsi rents quickly become unaffordable as well.

How does someone who makes less than their area median income (AMI) find housing that doesn't create a cost burden? They might be lucky and find housing that costs less than the area median. Some refer to housing like this as "naturally occurring affordable housing" – housing that is, for whatever reason, less expensive than the area average. But for someone who makes 30% or even 60% of the AMI, finding housing that is not burdensome can be a challenge. 

This is where another definition of affordability can come into play. Oftentimes when people talk about housing being affordable, they don't just mean that the housing costs its residents less than 30% of their gross household income. They specifically mean housing that is subsidized to be affordable to people who earn a specific percentage of the area median. According to HUD, 60% of the AMI is "low income," below 50% is "very low income," and 30% or less is "extremely low income." Rent is limited in subsidized housing so that it is affordable to someone who makes a specific AMI. Subsidized housing is built through various means, including housing commissions, organizations like Avalon Housing, and developers who include subsidized units in their projects.

The state of affordable housing in Washtenaw County

In 2015 Washtenaw County released the Housing Affordability and Economic Equity - Analysis. This report identified a need for Ann Arbor (and Pittsfield Township) to add 3,139 subsidized units by 2035. Since then, 249 affordable units have been added and 1,015 formerly affordable units have been lost. Countywide, there are just over 4,400 subsidized units, which make up about 8% of the total rental units. Almost 700 subsidized units are currently in development or construction and should open their doors in the next three years. You can see more on the county's Affordable Housing Dashboard

The scarcity of housing in our community makes affordability a major challenge in the county's urban core, with many people struggling to afford housing and making tough decisions regarding basic needs. 

"People with the highest income live wherever they can afford. It pushes up the prices and then the next-level people get what they can afford," Hall says. "So, inevitably, the lowest-income people are the ones that are priced out, have to move the farthest away, end up becoming homeless, or need some serious subsidy ... to enable them to live in the community that they work in. I think there needs to be a lot more housing choices for people of all incomes." 

Housing scarcity decreases the amount of naturally occurring affordable housing and makes renting more precarious. 
Site of the future development at 121 Catherine Street in Ann Arbor.
"Affordability is the biggest issue. People just can't afford to live in [Ann Arbor]. Some people are right now having to make tough decisions when it comes to what kind of food they're going to buy or their rent," says Zackariah Farah, chair of the Ann Arbor Renters Commission and a member of the Ann Arbor Tenants Union (AATU). "You can see the shortage not only in rent increases, but when you talk to tenants, they're having to apply at many, many more units before they get one. And as a result of that they are losing tons of money in application fees and other fees, which are generally unregulated." 

Major Stevens, another member of AATU, shares a recent example in which a tenant was asked to pay nearly $6,500 for a non-refundable "option contract" to secure an option to lease an apartment when it comes on the market.

"I've lived in Ann Arbor since I started undergrad in 2018, and the cost to rent and housing fees have dramatically increased," he says. 

Beyond allowing dramatic rent increases and a parade of new fees, Thomas says housing scarcity also allows landlords to discriminate against potential tenants. 

"There is always something more that needs to be done to keep people out [who] they want to keep out," he says. "[Landlords] find legal ways to discriminate against people they don't like. They find ways to keep people out based on their skin color or past history. They can add lots of hoops to jump through and there is no way to regulate this."

Is there hope on the horizon?

"Renting has gotten a little worse every year I've lived here, but there has been some recent progress," Stevens says. 

Stevens refers to Ann Arbor adding two new tenant protections in recent years: a right to lease renewal and regulating how early landlords can ask tenants to renew their leases. There are also several subsidized housing developments coming to fruition in the near future. The Ann Arbor Housing Commission and Avalon Housing are currently partnering on developing 121 Catherine St. in Ann Arbor. The largest source of funding is the Low Income Housing Tax Credit, but still it can be challenging to find enough money, especially for supportive housing. Supportive housing targets more vulnerable populations and includes voluntary access to services ranging from health care to substance use disorder treatment.

Avalon Housing is working on three more projects in addition to 121 Catherine, says Scott Ellis, the organization's director of mission advancement. Avalon broke ground this fall on The Grove at Veridian near County Farm Park, which will create 50 new units, or 114 bedrooms, of affordable housing. The city of Ypsilanti recently approved an Avalon development at 206 Washington St., which will create 22 units of affordable housing. Ellis says Avalon is also in the process of securing the financing for another property on S. Maple Road in Ann Arbor, which will add 38 more units of affordable housing.

Elsewhere in Ypsilanti, the Huron Vista and The Residences at Huron developments at 845 and 945 W. Clark Rd. will bring 300 units of affordable housing to the community, including some units for seniors 55 and older, according to Ward 3 Ypsilanti City Councilmember Desiraé Simmons. Prior to her tenure on council, Simmons served on the community benefits ordinance committee that worked with the developer and city council to bring this project to fruition. 
The Dorsey Estates site at 220 N. Park St. in Ypsilanti.
"This is really huge for the community in terms of the number of affordable units, and in terms of actually providing much-needed senior housing," Simmons says. "A lot of people don't want to leave Ypsilanti as they age and so we do need more housing for seniors." 

This in turn, frees up housing elsewhere in the community for people looking to start a family. 

Dorsey Estates is also currently under construction at 220 N. Park St. in Ypsilanti. This unique project will offer a subsidized path towards homeownership. Twenty-three of the 46 units in the development will be sold at below market rate. Deed restrictions on these properties will also ensure they will stay below market rate. 

A more affordable future?

There is hope for more affordability in our community, both for more subsidized units and non-subsidized affordable units. Beyond the projects already mentioned, Ann Arbor is evaluating proposals for an 18-story mixed income development on the old YMCA Lot at 350 S. 5th Ave. Ann Arbor now has a dedicated Affordable Housing Millage, and the city is currently re-writing its comprehensive land use documents. The City Council has instructed staff working on that project to do so with an eye towards affordability. 

Still, there is more work to be done. The Washtenaw Housing Alliance (WHA) has a goal of providing 500 permanent supportive units targeting people making 30% of the AMI and lower, according to WHA Executive Director Amanda Carslile. To do this, WHA will need an endowment of $60 million. Trinity Health and the Ann Arbor Area Community Foundation helped spur the creation of the fund by donating $1 million each. 
The Grove at Veridian near County Farm Park in Ann Arbor.
"Now that we've grown it to about $8.5 million," says Carlisle, "it's important to have an enduring source of funding for supportive housing locally that is not contingent on federal, state, or local budgets." 

There is a long way to go for the county to hit the subsidized housing target set forth in the 2015 report by 2035. And much needs to be done to address the scarcity that is at the foundation of the lack of naturally affordable housing. However, community advocates are making progress to ensure that everyone who wants to make their home in our community can do so with dignity. 

Ben Connor Barrie is an Ypsilanti resident and founder of the blog Damn Arbor.
All photos by Doug Coombe.
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