A man walks his dog past tower blocks on Sept. 1, 2022 in the Thamesmead area of London, England. Thamesmead, on the south bank of the River Thames on the eastern outskirts of London, mostly consists of social housing developments that were built from the 1960s onward. Photo by Carl Court/Getty Images.
A European-style affordable housing model could come to the U.S. under legislation introduced Wednesday by Minnesota Sen. Tina Smith, a Democrat, and Rep. Alexandria Ocasio-Cortez, D-New York.
The bill would create a new department within the U.S. Department of Housing and Urban Development to fund and develop what’s referred to as social housing, an affordable housing system widespread in many European countries, including Austria, France, England and Belgium.
Social housing systems vary from country to country, but generally differ from American public housing in several key ways. The income limits are often higher in social housing systems, allowing more people to qualify for rent-controlled units — in Vienna, for example, around 75% of residents qualify for social housing.
In some cases, even when a resident’s income increases, their rent stays the same. Advocates of social housing say this allows for greater economic mobility and economic integration, preventing social housing developments from becoming islands of poverty.
The developments don’t have to remain under the ownership of a government entity; the bill proposed by Smith and Ocasio-Cortez would allow land trusts, co-operatives and non-profits to finance affordable housing developments through the agency.
Some social housing programs, like the one in Paris, have years-long waitlists — much like the U.S. Section 8 housing voucher program, which subsidizes rent for low-income families.
The bill, accompanied by a 10-year, $300 billion funding request, is unlikely to pass the divided Congress.
“It’s important to be aspirational and to be ambitious about what it is that we can accomplish,” Smith said. “It’s important to lead in this way — if you can’t imagine it, if you can’t describe it, then you’re never going to get there.”
For groups that have been advocating for U.S. social housing, a national-level conversation about a potential path to affordable housing is an important step in the process, they say.
“We’re excited to see Sen. Smith and Rep. Ocasio-Cortez making a commitment to social housing at the national level — and in the meantime, here in Minneapolis, our members are fighting for innovative pathways to establish social housing at the county and state level,” said Jennifer Arnold, executive director of Inquilinxs Unidxs Por Justicia (United Renters for Justice), which has organized tenant cooperatives in the Twin Cities.
Smith and Ocasio-Cortez’s plan calls for the creation of a federal Housing Development Authority within HUD, which would partner with local governments, non-profits, land trusts or tenant co-operatives to finance affordable housing developments using a combination of congressional spending and Treasury-backed loans. Once complete, ownership would be transferred to the agency’s partner — it would not remain in the hands of the federal government.
Representatives from Minnesota-based organizations Rondo Community Land Trust and One Roof Community Housing in Duluth joined Smith and Ocasio-Cortez at a press conference in Washington, D.C. Wednesday announcing the legislation.
In greater Minnesota, small municipalities rarely have the staff capacity to take on affordable housing projects, said Noah Hobbs, policy director at One Roof Community Housing in Duluth, during the press conference.
Nor do they have the financing. “So this would fill a huge need,” Hobbs said.
Under the proposal, tenants would pay 25% of their household income in rent, but up to 30% of units in a development could be leased at market rate, helping to subsidize rent-controlled portions of the complex. The agency would also provide funding to establish land trusts, which remain affordable while allowing residents to build equity.
While a nationwide housing shortage is driving up the demand for new construction, there is also an urgent need for an estimated $80 billion in repairs to existing public housing complexes across the U.S. This year, the city of Minneapolis requested $35 million in state funding to cover much-needed repairs to the city’s public housing stock.
The bill would authorize the funding necessary to address the backlog of repairs in the country’s public housing complexes. It would also repeal a moratorium on new public housing developments.