Public Housing Is Social Housing

The housing crisis is a calamity that can no longer be ignored. AOC and Bernie Sanders’s newly reintroduced Green New Deal for Public Housing highlights the importance of deeply affordable and generously funded public housing as key to solving this crisis.

Alexandria Ocasio-Cortez speaks during a press conference with Bernie Sanders outside the US Capitol on March 21, 2024 in Washington, DC. Ocasio-Cortez and Sanders reintroduced the “Green New Deal for Public Housing Act” during the press conference. (Win McNamee / Getty Images)

Last month, Representative Alexandria Ocasio-Cortez and Senator Bernie Sanders reintroduced the Green New Deal for Public Housing Act, which would enable the spending of a much-needed $230 billion to weatherize, electrify, and repair all public housing.

For over fifty years now, the federal government has grossly neglected and slashed the budget of our nation’s public housing stock. Government programs have actively privatized and demolished public housing. Policymakers, through the “war on drugs,” have subjected public housing residents to racist criminalization and overpolicing.

Public housing remains a critical source of deeply affordable housing for the lowest-income families. Yet, in the midst of growing houselessness, we lose fifteen thousand of these precious homes every year to decay and lack of repair. Instead of allocating direct public funding for affordable housing, we rely on the Low-Income Housing Tax Credit Program (LIHTC), a scheme offering tax breaks to Wall Street investors, which diverts public money toward their profit-skimming. Meanwhile, policymakers’ decisions to gut our public housing directly fueled the explosion of mass homelessness we’ve seen across the United States since the 1980s.

Throughout the country, renters and unhoused people are uniting to call for renewed government action to ensure that housing is a human right. What’s more, this growing movement is adamant about the “for whom” and “how” of housing policy.

Renters are increasingly organizing to protest the role of Wall Street investors and large corporate landlords in our housing market, including within the sector of government-subsidized but profit-driven “affordable housing.” Launched in 2021, Renters Rising has built a national tenant association comprising seventeen thousand renters who have corporate landlords. It is beginning to organize tenants in publicly subsidized housing acquired by private-equity giants like Blackstone, which has been expanding its acquisitions of tax-credit properties since the COVID-19 pandemic.

“Blackstone and corporate landlords like them are worsening the housing crisis, as they seek to extract maximum profits for their investors. We need to stop allowing these big corporate landlords to buy up our neighborhoods,” says Amy Schur, campaign director of Alliance of Californians for Community Empowerment. “Instead, we should publicly fund housing that is off the private, speculative market.”

Housing justice groups are not only highlighting the problem of corporate control but also calling for lasting solutions: we must treat housing as the basic human need it is by decommodifying land and housing, so that homes are for people, not profit. In 2023, the Center for Popular Democracy’s national network of over fifty base-building groups, alliances, and unions decided to unite behind a national campaign organizing for green social housing, led by organizations of renters and unhoused people.

Social Housing for Whom?

Rooted in tenant and racial justice movements, we define social housing as a public option for housing that is permanently and deeply affordable, even for the lowest-income households. It is publicly owned or under democratic community control and it can never be resold for profit. Social housing is decommodified housing. For-profit investors are barred or grossly restricted. Our vision of social housing champions democratic management through the input of resident associations, tenant unions, and surrounding communities. Social housing includes quality public housing, permanently affordable housing owned by mission-driven nonprofits, and community land trusts and limited equity cooperatives under nonprofit community control.

Quality public housing — housing that is publicly owned, directly funded by the government, and hence affordable to the lowest-income people — is a fundamental cornerstone of social housing. In the United States, public housing is a form of social housing that has been with us for generations. It now serves as one of the only deeply affordable housing options left, housing 860,000 families nationwide. Policymakers must keep these families housed, rather than wastefully allowing their homes to decay or become unaffordable. Repairing public housing and improving conditions for residents is an essential first step toward housing justice.

Moreover, particularly when it comes to creating affordable housing, it is important to apply principles of “targeted universalism”: setting universal goals while using targeted processes to achieve them. Ultimately, social housing should be available to the majority of the population, including moderate-income households, to achieve lasting and far-reaching affordability across our entire housing system. But housing construction takes time. Housing production is not a policy like universal rent control, which can take effect immediately, covering all people everywhere, at once. Rather, production necessarily starts in certain places, benefiting certain people first.

To most effectively curb homelessness and displacement in real time and to best advance racial, gender, and economic justice goals, we must start with people who are most in need: the lowest-income residents, and people of color who have the least housing options. We must prioritize people living with disabilities, unhoused people, people with records, people without immigration status, single mothers with children, and other marginalized groups.

“Generational wealth has not been given to black and brown people. . . . The line drawn is not fair. Make sure that these people who are hurting, let’s make sure they’re taken care of and their head is laid somewhere safe at night,” says Winsome Pendergrass, a delegate member of New York Communities for Change (NYCC). She further states that:

Social housing should include all of the people who are struggling. The working-class . . . seniors . . . families and children . . . the person working three days at the lunch counter . . . the vulnerable immigrants. . . .When we visited Vienna we found there was . . . social housing that helped immigrants. . . . Social housing should be accessible to these people who make a community . . . the people who have been incarcerated and done their time; we have to find a way to make them part of society.

When, as housing justice advocates, we say we want social housing for all, we get there by first prioritizing those most in need. And we must ensure massive amounts of social housing are truly, deeply affordable to those most in need, to match the scale of need.

Rising to the Scale of Need

The typical US renter is forced to pay unaffordable rent. Over sixteen million households qualify for federal housing assistance, but receive none. Over twelve million households are forced to spend most of their incomes on rent. Nationally, we lack 7.3 million rental homes that are both affordable and available to the lowest-income families. This daunting level of need indicts the for-profit development industry, which builds fewer than about 1.5 million homes annually on average. The rental housing it creates is mostly unaffordable, while new construction too often sits vacant, functioning not as shelter but as assets that profit investors through gentrification. What’s more, over the past ten years, our communities have lost nearly four million deeply affordable homes renting for $600 or less per month — in large part to landlords’ rent increases.

This worsening crisis will only continue to escalate if the government does not aggressively intervene.

To make a significant impact, housing justice organizations are calling on the federal government to spend $1 trillion over ten years to create twelve million deeply and permanently affordable homes. This bold scale of action is both necessary and feasible.

Only government action and massive direct public funding will create housing that is truly and deeply affordable for our communities, at the scale required to meet today’s affordable housing crisis. Around the world, the historical record shows that public investment in housing for people, not profit, has succeeded where the private market could not, generating massive numbers of affordable homes. Government leadership to establish and fund robust social housing programs is effective at turning around housing crises. Robust social housing programs have successfully reversed widespread lack of affordable housing. They have expanded equitable housing access and raised whole populations out of poverty and into prosperity.

For instance, from 1965 to 1975, Sweden launched an ambitious effort to create public housing, successfully constructing over one million affordable homes owned by municipalities and cooperatives. The Million Homes Program brought affordable housing within reach of its entire population, raised living standards for a generation, and improved the quality of housing. In 1945, for-profit landlords owned most of Sweden’s rental apartments, but by the 1970s, this trend had reversed, with municipalities, public enterprises, and affordable housing cooperatives owning over 60 percent of them. If the United States implemented a per capita construction rate equivalent to Sweden’s, this would translate to constructing an estimated forty-three million homes within ten years.

Preserving existing affordable housing, as well as renovating and converting existing buildings into social housing, makes even more sense ecologically and economically. This approach is greener, cheaper, and faster than new construction. Social housing can be created by expropriating and converting corporate-owned properties. Across the country, sixteen million homes sit vacant, and, in fact, there are twenty-eight vacant homes for every unhoused person in the United States. A New York bill introduced to create a social housing development authority would allow the conversion of vacant homes as well as tax-foreclosed properties into permanently affordable social housing. Policies mandating the conversion of properties where landlords have neglected health and habitability standards, as well as granting tenant cooperative and social housing providers the first right of purchase, can also serve as mechanisms to create social housing.

Revenue Neutrality Is a Myth

Social housing that is deeply affordable, on a sweeping scale, and that truly prioritizes low-income communities of color, is how we can correct harmful legacies of our country’s racist housing policies and make strides toward racial justice. But to be truly affordable at scale, and to fulfill its potential in furthering racial, economic, and gender justice, social housing requires massive public funding.

“Revenue neutrality” has become a cost-cutting shorthand that refers to financing that avoids public inputs or subsidies that will not eventually be recovered or paid back. But financing schemes for social housing that aim for “revenue neutrality” do so at the expense of deep affordability and hence racial, economic, and social justice goals. For instance, some mixed-income developments have sought to achieve revenue neutrality — and remain viable in the face of insufficient federal funding — by “cross-subsidizing” cheaper rents aimed at lower-income residents with higher and even market-rate rents in the same project. As a result, the majority of units in such developments are not deeply affordable to the lowest-income households (achieving a worse affordability rate than many LIHTCs).

The publicly owned project recently developed in Montgomery County, Maryland, is actually 70 percent market rate. Its limited affordable units are not well targeted to extremely low-income households. While in some higher-income neighborhoods, such projects can open opportunities for lower-income households to move in, when placed in lower-income areas, they may contribute to gentrification and displacement. Cross-subsidization within buildings may also not be a viable economic option in rural areas or cooler markets.

Instead, wealth redistribution is necessary to adequately finance social housing. Public funds can be raised by taxing the rich: through initiatives such as Los Angeles’s Mansion Tax, we can tax luxury real estate transactions, corporate landlords, and speculation. Social housing can also be financed through public banking, pension fund investments, revolving low-interest loan funds, and public land banking.

Mixed-income social housing should still aim to be 100 percent affordable: that is, for all units to be priced below market-rates, in order to better serve those with the greatest need and avoid fueling gentrification. Social housing is most effective at advancing equity and affordability when generously funded, through wealth distribution measures more broadly conceived than building-level “cross-subsidization.”

We have the resources. Historically, the US government has spent far more money annually subsidizing housing for the rich than on housing for low-income people. Policymakers can and must redirect the exorbitant funding that the government already spends on subsidizing corporate landlords and wealthy elites — as well as on policing and militarization — toward housing for low-income and working-class people.

Both US and international examples show that when it comes to robust social housing systems, revenue neutrality is a myth. In the United States, the largest community land trust, the Champlain Land Trust, enjoys its size due to both local and federal government support. Launched in 1984, through the help of then mayor Bernie Sanders, it received a seed grant, pension fund loan, as well as Department of Housing and Urban Development (HUD) funds, and is sustained by ongoing funding from a small property tax increase.

During the period known as “Red Vienna” in the 1920s and ’30s, Vienna constructed sixty-five thousand public housing units by imposing new luxury taxes on private villas, cars, domestic servants, and other high-end consumption. Today, Vienna funds its social housing mostly through government loans with low interest rates and private bank loans subsidized through tax incentives to provide low interest rates. Over half of Vienna’s social housing stock is public housing directly owned and managed by the municipality, while the rest is owned by “limited profit” associations subsidized by the government. It is Vienna’s public housing that is most deeply affordable to lower-income households (other forms of social housing are less affordable because, due to insufficient subsidies, tenants must contribute large down payments).

Finland is the only country in the European Union where homelessness is decreasing. Its renowned “Housing First” approach to homelessness is undergirded by a strong social housing program that ensures the availability of affordable homes. Finland utilizes strong government subsidies at every level: Helsinki’s municipal government owns 70 percent of land, which it leases to social housing providers; local government serves as the largest owner and provider of social housing; and a public bank, jointly owned by local governments and Finland’s public sector pension fund, serves as the main investor, providing loans for social housing development.

That said, European countries have suffered neoliberal rollbacks since the 1980s: privatization, deregulation, and cuts to public services that have taken their toll on social and public housing, decreasing affordability while heightening inequality and marginalizing renters of color and immigrant communities. Today, Swedish tenants, often in migrant communities, are organizing to defend public housing and reverse its privatization.

The “Affordable Housing” Industry

In the United States, the federal government’s favored program for producing low-income rental housing has shifted from public housing to the LIHTC program. LIHTC provides tax breaks to for-profit investors who invest in lower-income housing. This means LIHTC essentially wastes our public dollars on enriching private Wall Street investors. The investors are earning more in tax breaks from the government than they actually pay into affordable housing. It would be more cost-effective for the government to directly fund the production of affordable housing instead of allowing this profit-skimming to occur.

LIHTC’s public subsidies enrich corporate landlords at the expense of low-income tenants, without creating deep or lasting affordability for low-income people. LIHTC acts as a corporate tax shelter that is attracting the largest private equity investors. Nationally, 80 percent of LIHTC developers are for-profit entities. Moreover, many LIHTC landlords are increasingly profit-seeking corporations rather than mission-driven nonprofits. Corporate landlords also benefit from rent increases, evictions, neglect of maintenance, and deplorable conditions for tenants. Profit-seeking landlords are more likely to convert buildings to market rate once LIHTC’s temporary affordability restrictions expire.

Many LIHTC residents are forced to spend half their incomes on rent. Too often, LIHTC housing is not actually affordable. Extremely low-income families are usually only able to stay in LIHTCs because they also receive vouchers. This is baked into LIHTC’s design: tax breaks are not an economically efficient method of creating affordable housing. State and federal governments must reform LIHTC to require that any housing it produces is permanently and deeply affordable, with strong tenant protections. Moreover, rather than tax breaks for for-profit investors, our communities need massive direct public funding for the creation of affordable housing.

Tenant and unhoused people’s organizing will be at the center of how we achieve the transformations we need in our housing system. Our movements must continue to strengthen local and national tenant unions, and fight for the right to bargain collectively, as recognized in San Francisco’s Union-At-Home ordinance.

We must create state and local infrastructure to support public and social housing — including financing mechanisms through public banks, pension funds, and land banking. At the federal level, President Joe Biden must support providing $1 trillion to create twelve million permanently and deeply affordable homes, and Congress must pass the Green New Deal for Public Housing Act. Biden must establish an office of social housing within HUD to coordinate social housing development with its public housing program, housing trust fund, and other relevant infrastructure. Additionally, Congress needs to create a federal social housing development authority to carry out property acquisitions and conversion to social housing. These transformations both address the roots of our housing affordability crisis and offer lasting solutions.