At a time when the nation’s housing crisis has hardened into political battle lines, a new study is challenging a central claim in the debate: that cities can solve their affordability problems by focusing exclusively on low-income housing.
The report, from the Georgetown Center on Poverty and Inequality, examines six high-growth metropolitan areas — Atlanta, Dallas, Houston, Phoenix, Seattle and Washington, D.C. — where construction since 2010 has made up a larger share of total housing stock than the national average.
Drawing on American Housing Survey data from 2015 to 2023, the authors set out to answer a central question: Who, exactly, is benefiting from new supply?
“Housing affordability is a nationwide crisis,” the authors write. “Lower-cost areas of the country are becoming more expensive, and rising housing costs are affecting homeowners and renters alike.”
They attribute part of the pressure to the “nation’s housing shortage—particularly of deeply affordable housing—” which they say has “contributed to surging rents and home prices, driven in part by restrictive regulatory environments.”
The study centers “deeply affordable housing,” focusing especially on renters with extremely low, very low and low incomes — households that often spend far more than 30 percent of their earnings on rent and are most vulnerable to displacement.
But the report does not completely dismiss the role of supply.
On the contrary, it acknowledges a body of research showing that “adding new market-rate housing can reduce rents or slow rent growth for lower-income households without exacerbating displacement.”
This reflects a broader economic reality that sustained affordability is difficult to achieve in markets where overall supply fails to keep pace with demand.
At the same time, the authors document patterns that complicate the argument that building more, by itself, will solve the problem for those at the bottom.
“Overall, the analysis shows that the newer housing stock in these metropolitan areas primarily served moderate- and higher-income households,” the report concludes. Even in places where construction surged, “the proportion of units serving lower-income households stagnated or decreased.”
In Dallas and Houston, roughly 22 percent of housing stock in 2023 had been built since 2010, compared with about 11 percent nationally. Yet much of the new rental construction consisted of smaller units in large multifamily buildings, often priced above what extremely low-income renters could afford. On the ownership side, new homes tended to be large single-family houses, reducing the availability of lower-cost entry options.
The rent data jumps out immediately as the report finds that “rent growth was generally higher for units serving lower-income households than the units serving higher-income households.”
In Phoenix, average rents for units occupied by extremely low-income households rose 26.7 percent between 2015 and 2023, while higher-income households experienced a cumulative decrease.
Those findings undercut the notion that supply growth automatically translates into relief for renters earning $20,000 a year or less.
This reflects an increasingly polarized debate about how cities should respond.
Critics of supply-driven strategies often point to the theory of “filtering,” the idea that as wealthier households move into newly built homes, older units gradually become more affordable.
The Georgetown report addresses that argument directly by noting, “Some housing experts argue that as areas add new market-rate supply, housing units will ‘filter down,’ becoming more affordable to lower-income households over time.”
But they add that “some evidence shows that this process has stalled or reversed.”
The outcome, they suggest, varies by place and by moment, shaped by local market conditions.
“Addressing housing instability for lower-income households—especially people with extremely low- and very low-incomes—requires comprehensive strategies that go beyond a reliance on market-rate supply,” the authors write in its concluding section.
“Go beyond” does not suggest eliminating market-rate construction but instead signals that increasing supply must be paired with tools designed specifically for households with the fewest resources.
The numbers help explain why.
Older housing stock remains a cornerstone of affordability.
About one-fifth of renter-occupied units built before 1980 receive some form of rental subsidy, compared with roughly 15 percent of units built between 2010 and 2023.
And of the five million rental homes nationwide supported by federal project-based rental subsidies, affordability restrictions for 374,974 are due to expire by 2030.
At the same time, federal rental assistance remains scarce.
“Only 1 in 4 eligible households receives federal rental assistance due to inadequate funding,” the report notes.
These constraints mean that households earning 30 percent of area median income — often less than $25,000 a year in many metro areas — are unlikely to find housing at affordable rents without some form of subsidy.
Construction costs, financing requirements and land prices make such units infeasible in most markets without public support.
The report’s recommendations call for “Prioritizing locally funded and equitable development financing mechanisms,” “Incentivizing diverse housing types and new affordable developments that serve very low- and extremely low-income families,” preserving existing affordable housing, and “Increasing resources for local, state, and federal rental assistance.”
What it does not do is endorse a halt to market-rate development.
In fact, the data suggest that restricting new construction in high-demand areas could have unintended effects.
When supply contracts in growing regions, competition intensifies.
Higher-income households continue to seek housing, often occupying older units that might otherwise have been available to middle- or lower-income renters.
The report notes that in the metropolitan areas studied, higher-income renters held increasing shares of rental units over time.
Vacancy patterns offer additional context.
In four of the six metros, newer units had higher vacancy rates than older ones, which may reflect mismatches in price point or housing type.
Yet that also implies that in the absence of new construction, demand pressures might have concentrated even more sharply in older segments of the market.
The broader lesson is that the housing crisis resists ideological shortcuts.
Supply constraints, regulatory barriers, rising construction costs and insufficient public investment all play a role.
The experiences of moderate-income renters differ from those of households with disabilities, families with children or voucher recipients and the report calls for further research into racial, gender and disability dimensions of housing access.
For policymakers, the message is complex: stabilizing rents for middle-income households appears to depend on sustained growth in overall supply, while meeting the needs of extremely low-income renters will require substantial public subsidy and preservation of existing affordable housing.
Casting the debate as a choice between market-rate and subsidized housing understates the scale of the challenge, as building deeply affordable units requires tax credits, bonds, appropriations and political will that have long lagged demand, while restricting broader supply risks further tightening already strained markets.
The Georgetown study does not present a single solution so much as a harder arithmetic: reducing housing instability “for lower-income households—especially people with extremely low- and very low-incomes,” as the authors write, will require both more housing overall and far more targeted public investment for those at the bottom of the income scale.
Anything less leaves the structure of the crisis intact — and the argument unresolved.
“In Dallas and Houston, roughly 22 percent of housing stock in 2023 had been built since 2010, compared with about 11 percent nationally. Yet much of the new rental construction consisted of smaller units in large multifamily buildings, often priced above what extremely low-income renters could afford. On the ownership side, new homes tended to be large single-family houses, reducing the availability of lower-cost entry options.”
Uhm, neither one of those cities is exactly known for “regulatory burdens” or lack of construction. I haven’t checked today, but it also seems likely that prices are dropping in those locales, as they have been for much of the country.
In any case, if one cannot find cheap, new housing in those cities, what chance are they going to find it elsewhere?
“Those findings undercut the notion that supply growth automatically translates into relief for renters earning $20,000 a year or less.”
Doesn’t this indicate a problem with income, rather than with housing?
Ron, you’re right that Dallas and Houston are not known for heavy regulation, and that’s exactly why they’re instructive cases. Even in high-production markets, new private construction rarely rents at levels affordable to households earning $20,000 a year. That’s why the report focuses heavily on the lack of subsidies.
At extremely low incomes, affordability is largely a function of income and subsidy.
But the point raised by the article is that overall supply still matters because when markets tighten, higher-income households compete for older, lower-cost units, pushing pressure downstream.
So yes, income is part of the problem. But housing supply and income levels interact. If you don’t address supply, you end up with homeless people who are not likely to improve their income levels.
That’s why for the poorest renters, you need subsidy combined with available housing that they can afford.
Moreover, for the broader market, you still need sufficient supply.
It’s not either/or.
That was the point of the report.
In addition, Dallas and Houston aren’t directing developers to build the type of housing that could serve lower income households. That’s where increased density requirements with transit come into play.
“So yes, income is part of the problem. But housing supply and income levels interact. If you don’t address supply, you end up with homeless people who are not likely to improve their income levels.”
If you can’t make it in Phoenix or Houston (with market rate housing), the problem is not housing (or lack of density, for that matter).
At that point, the problem can be found in the mirror. (That’s not a “moral” judgement, but it’s nevertheless a fact.)
Essentially the opposite of Frank Sinatra’s song: “If you can’t make it there, you can’t make it anywhere”.
Phoenix and Houston are consolation prizes for people who can’t even make it in Sacramento. And Sacramento (including to some degree Davis) are consolation prizes for those who can’t make it in the Bay Area.
I meant to say Dallas and Houston (since those are the cities referenced in the article), though Phoenix is an even better-example than Dallas at least.
You can throw in much of Las Vegas (and its surroundings) into that pile, as well. The places that are running out of water (where even the development activists are saying “whoa”).
And that’s before we get to the south (middle or east). Atlanta comes to mind, but so do other places.
Then again, we do have our own share of local hell-holes. (The difference being that you still might need at least $300K to get something in a dangerous neighborhood, whereas perhaps $150K will get you into a hellhole elsewhere.) I probably should have been a real estate agent myself, given my promotional abilities.
Meant to link this in the article – full report – https://www.georgetownpoverty.org/wp-content/uploads/2026/01/AbundanceforWho.pdf