Can Affordable Housing in Baltimore be Transformed? - Baltimore Post-ExaminerBaltimore Post-Examiner

Can Affordable Housing in Baltimore be Transformed?

Affordable Housing for Baltimore’s low-income families is at the forefront in the news. An incredible 83% of the city’s citizens voted this November to establish an Affordable Housing Trust Fund in the Baltimore city charter. This is going to push forward the expansion, production, planning and maintenance of housing for low-income families. It’s not the only way that affordable housing can be transformed though in Baltimore.

The new year

As we move into a new year of tax law, all eyes are on the real estate market, particularly when it comes to affordable housing. It is no secret that there has been a crisis in America for many years now. However, what we can be thankful for is the decision to preserve the 9% and 4% Low Income Housing Tax Credits. Partly this is due to the opportunity zones that have been created as part of the new tax laws. It is also due to the East Baltimore Development Plan – this has been put into place by the Choice Neighborhood Initiative Grant.

Sadly the tax credits aren’t worth as much as they used to be, according to Wally Scruggs, the president of the Housing Trust of America. It means that arranging funding for projects has become difficult. However, when panelists discussed this at the recent Baltimore Affordable Housing Investment and Development event, they pinpointed other financial sources such as new investment funds that have arisen.

New Investment Funds

Avanath Capital Management is one of the companies that have used a series of new investment funds to purchase affordable housing in Baltimore. It’s current fund – the third one that they have raised has attracted 32 investors, some international. These investors realize the value that affordable housing has for low-income families and are not just focused on the naked profiteering

The Affordable Housing Trust Fund also has a massive part to play in transforming Baltimore’s housing situation. At least 50% of the units that have been assisted by this fund must serve the low-income community. Adding to this, rental property that has been funded in this way must be guaranteed to conform to affordable rent for a minimum of thirty years. The “Housing For All” initiative is definitely being pushed forward.

Inspecting Baltimore’s homes

Helping Baltimore’s low-income families who rent their homes is important too. The properties also need to have adequate heating, lighting, and ventilation. From January 1, 2019, all of Baltimore’s rental homes are legally required to have a home inspection. This will ensure that affordable housing is of a good standard for living in – it sets a benchmark for quality, no matter what your level of income.

What about opportunity zones?

In America, the newly created opportunity zones – administered by the Department of Treasury, means that an estimated $2 trillion in unrealized capital gains can be deployed elsewhere within the property market. If some of this capital is moved into affordable housing, then it means that developers won’t be scraping around for every available tax credit. Baltimore has 42 areas that have currently been allocated as potential opportunity zones. There is a lack of restrictions on building, however, there will certainly be scrutiny on investors to build housing for low-income families.

Providing affordable housing in Baltimore is a priority if the city is going to continue to thrive. The next few years will be crucial to developing a diverse community that we can all be proud of.

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