More financial support is needed to develop additional affordable housing units in metro Milwaukee, according to a new report.
Wisconsin Policy Forum released a report Wednesday taking stock of housing affordability challenges in the city, where more than half of renter households spend at least 30% of their income on rent.
Based on a survey of dozens of nonprofit organizations and private developers whose work involves affordable housing development or housing services, WPF said increased affordable housing development was named as the strategy most in need of increased financial support. More than half (54%) of the 61 housing leaders surveyed said it was the top priority to address the housing affordability gap.
Non-governmental organizations in Milwaukee produce roughly 1,500 new affordable housing units per year, but there is a notable lack of units available to very low-income households, respondents said.
An estimated 31.5% of renter households in Milwaukee earn less than $20,000 annually, but only 9.5% of units in the city charge under $500 per month for rent, which is the maximum they could afford without becoming rent burdened.
Housing leaders surveyed said priority should be on developing affordable housing units near suburban employment hubs to increase job opportunities for low-income households and reduce residential segregation.
“(A) theme emerging from our interviews was a need to develop mixed-income housing – rather than developments that focus exclusively on affordable units – and to locate those developments near employment centers and high quality schools throughout the region instead of in city neighborhoods that already have an abundance of affordable housing,” the report said, noting that suburban communities would likely need to change local zoning regulations and long-range land use plans to encourage higher-density housing developments.
Ultimately, the report said, efforts to develop more units and provide housing services in the city won’t substantially move the needle on affordability challenges until incomes rise. Previous WPF research has found that renters’ low incomes, rather than high rental prices and availability of housing, is the primary driver of the city’s housing affordability gap.
“…with very low household incomes a primary factor underlying all of the city’s housing affordability problems, the solutions will likely have to extend beyond housing itself to economic and workforce development policies and strategies,” the report said.
Over the past 15 years, homeownership has declined in Milwaukee, from almost 50% in 2005 to 40% in 2019. That rate is lower among the city’s Black population, at 27%, compared to 37.5% of Hispanic households and 56% of white households.
In neighborhoods like Harambee on the city’s north side, where Milwaukee Habitat for Humanity recently launched an initiative to build 80 new affordable homes, the homeownership rate is 22%.
COVID-19 has only exacerbated long-standing housing challenges in the city, the report said. Despite a national moratorium on evictions throughout the pandemic, which is currently set to expire at the end of June, eviction filings have continued in Milwaukee. A tracker from Princeton University indicates the 8,732 eviction filings in the city in 2020 represented an increase from previous years. Housing leaders also said they are concerned about an even larger spike when the moratorium lifts.
“…preventing evictions through increased rent assistance, tenant-landlord mediations services, and (when necessary) legal representation are urgent needs for the immediate future,” the report said.
Currently, housing nonprofits direct significant resources toward home repair services; among 14 organizations surveyed, the combined budget for those services was $11.3 million in 2019.
WPF said that finding mirrors its previous research indicating the city of Milwaukee invests nearly half of its overall housing dollars in home repair services.
Among the dozens of Milwaukee-based organizations and developers surveyed by WPF were Acts Housing, Community Advocates, Inc., General Capital Group, Gorman & Co., IMPACT and LISC Milwaukee.
