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Report shows Louisville affordable housing gains not enough for lowest-income households

A small white house on a cloudy day
J. Tyler Franklin
A residential area in Louisville's Rubbertown community. City officials say more affordable housing options are needed across Jefferson County.

Louisville needs to build more affordable housing, local leaders say. A new assessment released Wednesday shows that while the city has made some progress, the need is still great for low-income residents.

There are around 36,000 missing housing units for Louisvillians making 30% or less than the area median income, according to a new housing needs assessment. Five years ago, the gap was 31,000.

The supply of affordable and available homes is enough for 55% of those households — a nine-percentage-point improvement compared to 2019. That’s when the city last issued this kind of assessment, using data from 2012-2016.

The third-party report uses data from the 2017-2021 American Community Survey to determine the number of housing units that are affordable to residents — meaning they don’t have to spend more than 30% of their income on it — across the financial spectrum.

It found shortages remain for Louisville residents with the lowest incomes, especially those making 30% or below AMI, which was at or under $26,900 for a family of four in 2023. The report attributes the missing 36,000 units to an overall population increase.

It also found that in 2021:

  • The median gross rent was $954, a nearly 10% increase from five years earlier, after adjusting for inflation
  • All affordability groups saw increased incomes compared to five years earlier, except for households at or below 30% AMI, whose incomes fell by 8%
  • There were enough affordable and available homes for 90% of households making 50% or below AMI, up from 74%
  • There were surpluses of affordable and available homes for households making up to 80% and 100% of AMI

During a press conference Wednesday, Louisville Mayor Craig Greenberg said the new report showed improvement, but that more progress is needed. He has committed to build 15,000 affordable housing units across incomes by 2027.

“We all need to continue to work together, to make sure there is affordable housing in every neighborhood in Louisville, not just in other people’s neighborhoods,” Greenberg said.

Caitlin Bowling, a spokesperson for the city’s economic development arm, said in a text Wednesday that about 600 affordable housing units have been introduced in Louisville since Greenberg took office in Jan. 2023. Most of those are targeted at households making up to either 50% or 80% AMI.

She added that nearly 3,300 more units are under construction, about a third of which are for households making up to 30% AMI.

Greenberg noted that city planners are currently working on an amendment to Louisville’s land development code that would allow forms of middle housing, like duplexes and townhomes, to be built on land that’s currently zoned for single-family houses.

But that change, if approved by the Louisville Metro Council, would not automatically apply to independent cities within Jefferson County that have their own zoning authorities. They could choose to adopt them.

Greenberg said that his administration stressed the need for expanding affordable housing in conversations with those cities’ leaders.

“We hope that they’re partners with us to help make this happen,” Greenberg said.

Metro Council Member Andrew Owen, a District 9 Democrat, also spoke at the press conference. He is the chair of a new council committee that aims to focus on specific development issues in the city.

“This housing needs assessment is our charge. How do we make changes to our land development code, regulations, that sort of thing, to make sure that as a community, we can fill the gap of the deficit of affordable housing,” Owen said.

Owen said the committee is eyeing middle housing, inclusionary zoning and streamlined development as priorities.

Jacob is LPM's Business and Development Reporter. Email Jacob at jmunoz@lpm.org.

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