How the City of Boston Defines Affordable Housing

Boston, like most major cities experiencing rapid growth, is facing an affordable housing crisis — the majority of residents cannot afford the city’s housing stock, and low-and-middle income residents are finding it difficult to stay in their homes. In 2014, the Walsh administration, responding to development pressure and seizing the opportunity to grow, created a plan to build 53,000 new units of housing by 2030 — a plan that promises to result in more affordable housing opportunities for Bostonians as it is implemented. Thousands of new units have already been completed or permitted in accordance, and as residents see their neighborhoods transform, they’ve been assured that the building taking place is for their benefit: Mayor Walsh has said on multiple occasions that so far “rents have decreased in existing stock by 4% citywide” and “40% of all new housing stock is affordable to low and middle income people”. Hearing these claims, many Bostonians have wanted more information — they’ve asked what “affordable” actually means and why they aren’t personally experiencing decreasing rents if costs are reported to be going down.

Boston’s data on affordable housing is often confusing and sometimes misleading; reports on housing contain inconsistencies in data and how affordability is defined. The City has a new website focused on affordable housing which still does not state a simple definition of “affordable”. In recent months, my colleagues and I (who work in affordable housing, independently of the City) were able to get some clarification, or at least insight, into these matters regarding affordability from helpful staff at City offices. This post is intended to help provide understanding in response to the commonly asked questions regarding: 1) how affordability is defined, 2) what Boston’s affordable housing stock looks like, and 3) how rents can possibly be decreasing in a time when most are feeling (at the very least) financially pinched. The focus is on rental housing since it’s what residents ask about most often.

One of many posts regarding progress in affordable housing from Marty Walsh for Boston Facebook page

1.What is Boston’s definition of “affordable”?

The standard HUD definition of affordability, used by many cities across the country to define affordable housing, is “housing for which the occupant(s) is/are paying no more than 30% of his or her income for gross housing costs, including utilities”. By the same definition, any household spending more than 30% of income on rent is considered “cost-burdened” or “rent-burdened”.

The City of Boston lacks a clear definition of affordable housing and of housing cost burden. It too defines affordability using HUD’s 30% standard measure on some of its official websites, but all major housing and planning reports under the Walsh administration commonly use another definition: housing for which the occupant(s) pay 35% or less of income on rent is affordable, with households spending more than 35% of income cost-burdened. Then, in its central housing document, the Boston 2030 housing plan (page 26), the City actually defines affordable for non-elderly households as spending up to either 35% or even 50% of their income on rent (see table below):

— For family households with children, the City uses 35% of income as a measurement of housing cost burden. Any household spending up to 35% income on rent is considered affordable.

— For non-family households, the City uses 50% of income as a measurement of housing cost burden. This means that any household spending up to 50% of income is considered affordable.

The puzzling and far-reaching 50% of income affordability measurement doesn’t appear repeatedly in planning documents like the 35% measurement does, but it is incorporated into the principal Housing 2030 plan. It is clear that the City uses 35% as a measurement and may sometimes count units as affordable using up to 50% of a household’s income if the household does not have kids. Both the 35% and 50% measurements are different from widely-used HUD definitions. Standard definitions of housing cost burden refer to those paying more than 50% of income on housing costs (including utilities) as “severely cost-burdened,” and those paying more than 30% on housing costs as “cost-burdened.” Here, what is considered to be cost-burdening and a severely cost-burdening by HUD standards is instead considered affordable. Using 35% or 50% instead of 30% means that renters spend much more of their income on rent while having their housing deemed “affordable” to them. It also means that the City’s estimate of households who are housing cost-burdened and severely cost-burdened is smaller than standard estimates, making the reality of Boston’s cost burden seem less severe than it actually is.

Table from “Housing A Changing City: Boston 2030” using 35% and 50% of income as affordability measurements

Many housing advocates take issue with how the City categorizes low-income and middle-income earners. The typical household in Boston makes $55,000 a year or less, but the middle/working bracket is defined as $50–125k. The low-income and middle-income terms treat much of Boston (those who are considered “low-income”) as “other” and as if they are not part of the workforce. It also means, because the City is calling those making $50–125 the middle, typical, working household, housing production for this group should be made priority, while low-income housing is lower priority.

Below is an example of a rental unit that would be considered affordable based on the City’s definition. The unit is not deed-or income-restricted but is affordable because a “middle-income” individual could live there spending 34% of income on rent (see next section for more on deed restrictions).