LIHTC: The Good, the Bad, and the Very Complicated

LIHTC developers must follow strict affordability rules—and fulfill other promises—for at least 30 years. While industry insiders insist compliance rates are high, tenant advocates say noncompliance is a real problem.

Arrangements in which LIHTC tenants share in the development’s financial benefits, or become partial or full owners, are rare—but some properties have pulled them off. This scan of several examples shows the possibilities—and the conditions needed for them to succeed.

Housing and policy experts agree that LIHTC has successfully increased the supply of affordable housing. But they also believe there’s room for improvement.

The Low-Income Housing Tax Credit is famously complex. We can’t exactly make it simple, but we’ve broken down the basics, especially those that residents of a LIHTC property might want to know, as clearly as possible.

Three years after our initial story, aggressive investors are still suing LIHTC general partners to profit off of what should be affordable housing. But one legal decision, along with proposed legislation, could help protect the right of first refusal.

Last year, we reported on tenants in Northern Virginia LIHTC properties whose rents were raised in the middle of their leases. Here’s how other states have banned the practice.

Even those who praise the tax credit program and what it has accomplished are concerned that there are so few sizeable alternatives to it.

Adding more credits and making tweaks do not actually address some of the major weaknesses of the program. We should be bolder.

This video breaks down the LIHTC rent-setting process, and shows the surprising number of people it doesn’t serve.