Harvard Research Examines State and Local Programs Promoting Middle-Income Housing

Housing Affordability
Published

The Harvard University Joint Center for Housing Studies (JCHS) recently released a white paper, “Subsidizing the Middle: Policies, Tradeoffs, and Costs of Addressing Middle-Income Affordability Challenges,” that examines 11 state and local programs designed to address middle-income housing needs amid the housing affordability crisis.

The programs that the JCHS researchers analyze target middle-income rental households — which constitute 14.4 million renters, or one-third of all renters nationally, who earn between 60 to 120% of area median income (AMI) — through direct or indirect public subsidies.

“Numerous state and local middle-income housing programs have been created in recent years with the explicit intent to address the affordability challenges of households in the workforce,” the paper notes. “These programs suggest that working adults should be able to afford to live in the communities where they work.”

State programs examined include:

  • Florida: Missing Middle Property Tax Exemption
  • Georgia: Rural Workforce Housing Initiative
  • Michigan: Missing Middle Housing Program
  • Colorado: Middle-Income Housing Authority
  • Rhode Island: Middle Income Loan Program
  • California: CSCDA Workforce Housing Program
  • Minnesota: Workforce Housing Development Program
  • Massachusetts: Workforce Housing Initiative
  • Kansas: Moderate Income Housing Program

Local programs examined include:

  • Philadelphia: Workforce Housing Credit Enhancement
  • Breckenridge, Colo.: Workforce Housing Five-Year Blueprint

Although the programs differ in terms of funding, activities and requirements, the researchers identified several key themes, including the recent focus on this segment of housing, the use of AMI as a threshold to determine eligibility, and geographic diversity of these programs.

Researchers also found that these middle-income housing programs are primarily focused on “expanding the supply of housing affordable to middle-income households through new development, though many projects also fund rehabilitation, adaptive reuse, or acquisition and conversion.”

Most programs offer favorable or forgivable construction financing to developers of middle-income housing, the paper adds, as well as grant funding directly to developers. Some programs provide a cap on per-unit funding, which may depend on the type of activity funded and/or subsidy provided.

Researchers note that many of these programs are relatively new, so it’s difficult to determine their full impact. The research also takes a comparative look at middle- vs. low-income renters — based on factors such as housing affordability challenges, employment status, geography and demographic details, and identifies the benefits and concerns surrounding middle-income housing programs — with concerns that these programs may be overshadowing the needs for the nation’s most cost-burdened renters.

In addition to these types of housing programs, JCHS researchers propose that states and localities look toward additional solutions outside of subsidies to help increase housing supply — solutions that underline key points from NAHB’s 10-point plan.

“Liberalizing local zoning ordinances, particularly in areas that allow only single-family homes, can encourage a broader range of housing types like small multifamily buildings, ADUs, or manufactured homes, and can make it easier to increase the overall stock,” the paper states. “Expedited permit processes, relief from some environmental or community review requirements, reduced parking mandates, or density bonuses for projects that hit a specified affordability level could also encourage development that benefits middle-income renters.”

Visit jchs.harvard.edu to view the full report.

Subscribe to NAHBNow

Log in or create account to subscribe to notifications of new posts.

Log in to subscribe

Latest from NAHBNow

Workforce Development

Oct 10, 2025

HBI Report Reveals Economic Impact of Labor Shortages on Housing Production

The 2025 Fall Labor Market Report reveals the true cost of too few workers in the residential construction industry, and provides insights on generational and demographic shifts in the workforce.

Safety

Oct 10, 2025

Fighting the Stigma of Mental Health in Construction

Friday, Oct. 10, is World Mental Health Day, an annual observance from the World Health Organization to raise awareness of mental health issues around the world and to mobilize efforts in support of mental health.

View all

Latest Economic News

Economics

Oct 10, 2025

Vinyl Surpasses Stucco as Most Used Principal Exterior Wall Material

In 2024, vinyl siding was the most used principal exterior wall material for homes started. It holds just over a quarter share of homes, slightly surpassing stucco for the first time since 2018.

Economics

Oct 09, 2025

Remodeling Market Sentiment Improves in Third Quarter

In the third quarter of 2025, the NAHB/Westlake Royal Remodeling Market Index (RMI) posted a reading of 60, up one point compared to the previous quarter. With the reading of 60, the RMI remains solidly in positive territory above 50, but lower than it had been at any time from 2021 through 2024.

Economics

Oct 08, 2025

Refinancing Activity Surges in September

Refinancing activity surged in September, marking the largest monthly increase since the COVID-era of ultra-low interest rates. This increase followed mortgage rates dropping below 6.5% for the first time since October 2024 in anticipation of rate cuts that ultimately materialized. ­­