One week after Austin officials voted to increase the amount of housing allowed on single-family properties, City Council moved to create a financial support program for low- and middle-income residents seeking to build additional units on their lots.

The details

The outline brought by council member José Velásquez could lead to the creation of a city program offering down payment assistance for those wanting to either build a home or renovate their house to include additional units.

The framework advanced with the passage of Velásquez's resolution Dec. 14. In addition to detailing the down payment plan itself, that measure also called for:
  • Engagement with Austinites, particularly residents facing displacement, on the program's development
  • Marketing the program to homeowners in areas at a higher gentrification risk
  • Creating at least one Development Services Department staff position to assist residents with navigating the potential program
  • Limiting short-term rental properties from participating in the financial program
  • Complying with anti-displacement initiatives tied to the Project Connect transit plan
“[This item] aims to offer financial support to lower- and middle-income people who want to build an additional housing unit on their property while ensuring we create a process of working with our partners to engage and inform the community with the goal of reaching the people that need it most," Velásquez said.

Now, city staff will explore options for the program's creation and return to council with more details by mid-March.

The context

The attempt to make additional housing construction more accessible to lower-income Austinites followed council's controversial update to residential development rules through Phase 1 of the "HOME" initiative. Up to three housing units are now allowed on most of Austin's single-family property, while a second phase coming next year could slash the amount of land required to build a home.

Velásquez's proposal was co-sponsored by council members Natasha Harper-Madison, Vanessa Fuentes and Chito Vela, who said the financial assistance program would end up supporting low- and moderate-income families wanting to take advantage of HOME allowances.

“The truth of the matter is homeownership is expensive, and there are so many parts of homeownership that you really just don’t know until you know it. I think the financial assistance component is always going to be necessary for some segment of new homebuyers, especially," Harper-Madison told Community Impact. "There are folks who own their homes outright in the Eastern Crescent who are losing their properties because they can’t keep up with the taxes.”

Diving in deeper

Council's action in December follows other attempts in recent years to make it easier for Austinites to add smaller new housing units on their property.

In 2020, former council member Kathie Tovo authored a resolution aimed at streamlining the development of residential accessory dwelling units, or ADUs, with a stated goal of growing low- and middle-income housing options.

That document noted the financing challenges often experienced by those seeking to add such housing, and called on city staff to find ways to offer low-interest loans, grant funding or tax breaks for ADU builders. City staff offered several recommendations based on that council request in 2021.

Later that year, another Tovo resolution aimed at making ADU development simpler and more accessible was also approved by City Council, although not all requests from that measure have been completed.