CivicLex Info Hub

Why does Lexington locally fund Affordable Housing?

Sectors: Development & Housing

Council Districts: All of Lexington

Issue Sections

Quick Summary

  • Lexington locally funds affordable housing because there are over 6,000 full-time working households that have trouble finding housing that is affordable in Lexington.
  • This is because of two trends in Lexington
    • The cost of housing is rising.
    • Base wages aren’t increasing.
  • This forces these households into either high-priced or substandard lower-priced housing.
  • Much of the federal funding that is available is difficult to work with. Local subsidies can make development cheaper, while requiring developers make their development affordable for low-wage working households without creating significant additional burdens for developers.

Why does this matter?

What is the context?

  • The reason Lexington’s housing market has this gap is a combination of fast-rising home/rental prices and slow wage growth for low-wage, full-time workers.
  • From 1990–2014, local rents increased so much that more than 28,000 apartment units in Lexington that used to be affordable to low-wage workers weren’t any longer.
  • Home prices are rising largely due to Lexington’s success in attracting and keeping talented workers and the mid-to-high-paying jobs that come with them.
  • Lexington funds affordable housing at a rate of around $2 million per year. This is significantly less money than the city-commissioned study recommended. According to the czb study,  it would cost around $19.8 million per year for ten years to ensure affordable housing for all.
  • After that, it would cost around $2.4M to keep up with the amount of units that become unaffordable each year.

How can I get involved?


  1. Center for Housing Policy - The Role of Affordable Housing in Creating Jobs and Stimulating Local Economic Development: A Review of the Literature
  2. Brookings Institution - City and metropolitan inequality on the rise, driven by declining incomes
  3. World Resources Institute - The Crisis in Affordable Housing Is a Problem for Cities Everywhere
  4. Urban Institute - The Cost of Affordable Housing
  5. Commonwealth Economics - Lexington/Fayette Affordable Housing Trust Fund Fiscal, Economic, and Social Impact Study
  6. czb - Lexington's Affordable Housing Challenge and Potential Strategy