A fund created to preserve affordable apartments in Austin has raised enough money to begin buying properties.
“We’re not going to say how much [money] we have," he says. "Our goal this year is to raise $30-$50 million. We're not there yet. We still have a lot of work to do.”
The housing created through the fund will be income-restricted, meaning residents have to make below a certain salary. In Austin, the median family income is about $81,000 a year for a family of four. Steinwedell says the group wants to house people who make anywhere from 60 to 120 percent of the area’s median family income.
Steinwedell says the fund was created in conjunction with a similar effort to buy and preserve affordable housing proposed Austin Mayor Steve Adler. While the mayor’s plan has a broader focus, the Conservancy is zeroing in on what it calls “workforce housing.” The group wants to house residents who make too much to qualify for other affordable housing programs – people like nurses, teachers, musicians and first-responders.
“There are programs that are out there that meet the needs of low- and very low-income [people],” he says. “There’s nothing there to meet the needs of people that are earning somewhat more, but are still feeling the stresses of affordability. So when we were looking at this with the mayor and his staff, we decided to focus on workforce.”
A private nonprofit also has the leeway to do things the city can’t. For example, Texas law doesn’t allow for rent control, so the city can’t limit how much landlords increase rent. Because the Conservancy will continue to raise money, Steinwedell says, it will be able to limit the rate of rent increases and align them with Austin’s wage growth.
It remains to be seen how the nonprofit will keep rents stable when faced with other forces that can drive up costs, like Austin’s notoriously slow permitting process, says Geoffrey Tahuahua, vice president of policy and government affairs at the Real Estate Council of Austin.
“One of the things we deal with a lot is just the sheer delays and the cost associated with the delays that ultimately then have a cost on the consumer,” Tahuahua says. “There’s going to be a tangible cost to those delays, and they’ll have to be absorbed somewhere, and so I think that’ll definitely be a challenge for them.”
David Danenfelzer, a senior director with the Texas State Affordable Housing Corp., says construction delays are an inescapable reality in many cities, though they may be worse in Austin. The independent nonprofit, which was created by the state Legislature, has been working for decades to house moderate- and low-income Texans at the statewide level.
Still, Danenfelzer says, the Austin Housing Conservancy is investing at a crucial time. He says nonprofits may be able to weather changing market forces because they’re focused on keeping things affordable in the long-term, not earning fast profits.
“Efforts to preserve what is affordable now ... is a good idea because it captures value now and builds on the affordability down the line,” he says.