A New Model for Affordable Housing
The Challenge: Affordable housing is a problem that worsens with time. As the free market appreciates, opportunities recede and the cost to develop affordable housing increases. Since 1992, affordable housing in Teton County has been funded by taxes, developer exactions and private donations. Over this same time period, the subsidy (the difference between the cost of development and the sale price) required to sell a home that is "affordable" to someone in our workforce has jumped from $16,000 to $300,000.
The Solution: Affordable Rental Housing. The model is simple and the impacts are significant. On seven lots in east Jackson, the Housing Trust will build 28 affordable rental units with a total project cost of $12,100,000. Redmond Street Rentals will house more than 40 people and net $240,000 annually. This predictable, recurring revenue stream can be invested in new opportunities or leveraged to access alternative sources of funding.
Once this concept is developed to scale, we will have a sustainable model for the development of affordable housing that minimizes the need to underwrite operating budgets and construction subsidies.
Our $12,100,000 investment today will result in a diminishing reliance on taxpayer, donor and developer subsidies tomorrow.