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Louisville Policies Should Match Need For Affordable Rentals, Report Says

Affordable housing got a boost in this year's city spending plan.

Rental trends in Louisville and across the country are affecting affordable housing advocates' policy preferences.

The Metropolitan Housing Coalitionreleased its annual state of housing report Tuesday. This year's report focuses on affordable and fair rental housing in the 12-county metro area that includes Louisville and parts of Southern Indiana.

Executive director Cathy Hinko said homeownership, long a tenet of the American Dream, is no longer every American’s goal. Young people saddled by student debt, seniors living on fixed incomes and lower-paid workers are among those for whom renting is the best — or only — option.

In the Louisville area, there was a more than nine percent increase in renter-occupied units from 2010 to 2015, the report said. And since 2006, the percentage of higher-income renters is up, too.

Hinko said she's not against homeownership. But she wishes renting was treated with the same level of acceptance.

“If you’re as old as I am, you always thought, ‘Oh, Louisville’s very affordable and people should own.’ And then came 2006 and a change in our whole way of housing people,” Hinko said. “So we have a lot of people with old paradigms making policy and enforcing policy but the new paradigm is rental at all price points, all rental points.”

Fair and affordable rental policies are essential to decreasing segregation, lowering the eviction rate and supplying workers across Louisville and its surrounding counties, Hinko said.

Hinko said she’s hopeful that recommendations in the Coalition’s report will lead to short- and long-term change in the Louisville area. She sees a more proactive approach from Metro Council, which, for example, tied affordable housing assurancesto a tax increment financing (TIF) request last year. The Coalition recommended requiring a commitment to affordable housing for any TIF that creates low-wage jobs.

But in other cases, Hinko said local lawmakers have fallen short. She pointed to a decision in October that shut down plans for an affordable housing project for seniors in Prospect. That prompted the developer to file a fair housing case against Metro Council.

“We theoretically have a commitment to fair and affordable housing but when the vote is out there we don’t seem to have an actual commitment to fair and affordable housing,” Hinko said. “So we have to keep working on that.”

But she said at least leaders are saying the right things, and sometimes doing the right things. Hinko said one reason for that may be an effort over the past year and a half that encouraged area residents to speak at Metro Council meetings about their housing problems. They could have helped show the Council how important this issue is, Hinko said.

Here are some more takeaways from the report:

  • Louisville ranks seventh out of the top 50 largest Metropolitan Statistical Areas for its eviction rate, which was 5.3 percent from 2015 to 2017. The Coalition calls for a program of short-term low-interest or forgivable loans for low-income renters at risk of eviction.
  • The area ranks ninth for percentage of owner-occupied households, but is down almost four points from a 2006 high of 70.3 percent. This indicates additional pressure on rental market, which had a vacancy rate of 7.2 percent in 2015, down from 9.9 percent in 2009.
  • The share of rent-burdened households, or those that spend 30 percent or more of their income on housing, in the Louisville area dropped more than 7 percent from 2012 to 2015. That figure fell about 5 percent among seniors. But the report points out that there are about 31,000 severely-burdened Louisville-area households, meaning those whose rental payments eat up more than half their income.
  • Homeownership rates differ drastically based on rates. While 70 percent of whites own their homes, just 37 percent of black/African-American and 39 percent of Hispanic/Latinx households do.
  • If property owners in eastern Jefferson County accepted Section 8 vouchers, it could help decrease the concentration of poverty in western neighborhoods. Hinko said Section 8 payments would need to be increased for eastern neighborhoods. The report calls for linking changes in Section 8 policy to job and transit needs.
Amina Elahi is LPM's City Editor. Email Amina at aelahi@lpm.org.