Affordable Housing Fund
What is an Affordable Housing Fund?
An affordable housing fund is an ongoing dedicated source of public funding designed to support the preservation and production of affordable housing.
How does an Affordable Housing Fund work?
Because creating affordable housing is not very profitable, affordable housing projects often require financial investment from multiple public sources. Federal and state programs also require a matching local investment before they will provide funds for an affordable housing project. An AHF provides a flexible source of local funding to leverage other public, private, and philanthropic investments in affordable housing or support investments (fill gaps) that would not otherwise be filled through existing public programs.
How is the Town of Blacksburg furthering this strategy?
The Town of Blacksburg established an Affordable Housing Fund to help increase the number of affordable homes developed for our workforce (non-students), provided these homes remain permanently affordable. Long-term affordability is important because these investments are expensive and the Town wants to ensure that they benefit as many households as possible. Permanent affordability for owner-occupied housing would be achieved by writing down the price of the home to a price that is affordable for a lower-income family and then restricting the sales price upon resale so it can remain affordable to all subsequent low-income families who purchase the home. For rentals, long-term affordability would come in the form of a requirement that the developer keep rents affordable to households of specific Area Median Incomes for a specified period (greater than 60 years). Blacksburg is using $4 million in American Recovery Plan Act funding to seed the Affordable Housing Fund but still needs to identify a dedicated ongoing source of revenue to ‘fund the fund’. Stay tuned for more information on affordable housing fund project awards.