Joshua W. Wood IV, JD, MAI, AI-GRS

Senior MAnaging Director

Artificial intelligence is transforming industries with its ability to streamline tasks and process data at incredible speeds. But can it truly match the nuanced decision-making and critical thinking of human experts? When faced with real-world complexities, like identifying key factors in a property appraisal or filtering out irrelevant information, AI falls short—highlighting the vital role of human judgment. While AI is a powerful tool for efficiency, the expertise and adaptability of professionals remain irreplaceable.

  1. Increasing Housing Stock for the Vulnerable Population: One of the primary contributions of LIHTC properties is the expansion of affordable housing options for low-income individuals and families. By incentivizing private investment, the LIHTC program has significantly increased the overall supply of affordable rental units. The tables below, which are based on information taken from the HUD LIHTC Database, indicate peak years for unit delivery occurred between 2004 and 2007 with nearly 140,000 units annually, most of which were new construction. According to the US Census Survey of Construction (2023), annual LIHTC delivery accounts for roughly 20% of all new multifamily units nationwide.  The LIHTC program not only helps address the immediate housing needs of vulnerable populations, but also contributes to the stabilization of communities by providing a more balanced housing market.
  1. Neighborhood Revitalization: LIHTC properties often play a pivotal role in the revitalization of distressed neighborhoods. By encouraging the development of affordable housing in economically depressed areas, the program often brings additional public / private investment to the community in the form of improved infrastructure, commercial and recreational amenities, and additional job opportunities, all of which improve the neighborhood and its residents.
  1. Diversified Housing Options and Demographics: LIHTC properties typically include apartment complexes or single-family homes. However, the housing options can be tailored to accommodate any number of unique demographics including families, seniors, and individuals with special needs. More recently, housing agencies have set aside tax credit allocations for developments that target homelessness, individuals with mental illness, or people who battle addiction.
  1. Long-term Affordability: LIHTC properties are subject to strict regulatory agreements that mandate rent and income restrictions for a specific period, typically 30 years. This helps ensure the long-term affordability of these units, safeguarding against market fluctuations that might otherwise render affordable housing unattainable for low-income households. This is particularly relevant in today’s economic environment where multifamily rents have seen YoY increases of more than 10% in many markets across the county. The program’s commitment to enduring affordability underscores its effectiveness in providing stable and secure housing options for those in need.
  1. Public-Private Partnerships: The LIHTC program fosters collaboration between the public and private sectors. Developers, investors, and government agencies work in tandem, each contributing unique strengths to the affordable housing ecosystem. This collaborative approach not only maximizes the impact of available resources, but also encourages innovation in design, construction, and management of affordable housing developments.