“Income restricted housing” is a strategy being implemented in many metropolitan areas across the US, in which the government subsidizes a certain amount of housing – either rental or for purchase – so that low-income families can have good quality housing without breaking the bank. Many income restricted housing developments are new apartment or condo communities, because the developers can claim certain grants and government subsidies to aid in the cost of development.
The turnover can be very low
Especially in major metropolitan areas, where rents are typically much, much higher, getting approved for an income restricted unit can be a big score for a family struggling to make ends meet. Income restricted developments are often designed with families in mind, with fairly large floor plans and on site amenities like playgrounds and even swimming pools. Because of what is available at relatively low rent, the waiting lists for income restricted housing can be very long: once a family finds a unit that suits their needs and doesn’t eat up all their income in rent, they will often stay put until the kids are grown. This means that income restricted properties often show more wear and tear than typical apartments, simply because families tend to live there longer. Don’t be surprised to find all the usual nicks, scratches and worn patches that you’d expect to find in an older family home during your property inspection.
The units are usually very well maintained
It’s easy to automatically think of low income neighborhoods as seedy and derelict, but in income restricted housing the opposite actually tends to be true. Qualifying for income restricted housing is a lengthy and sometimes complicated process, and those who do qualify are able to afford a much higher standard of living than they would normally be able to. Families living in income restricted housing are usually very aware of how fortunate they are to be able to raise their kids in a reasonable amount of space, so they tend to keep their units in pretty good condition so that they can stay there for many years. Income restricted housing offers lower income families stability, and the state of the apartment when they move out usually reflects that.
Damage is especially important to report
Part of the deal when an income restricted property development qualifies for the grants and tax breaks is that it provides an acceptable standard of living to tenants who might otherwise be stuck in poorly-maintained or even dangerous buildings. If the development violates health and safety codes it can find itself in protracted legal battles over its tax status, which can come back and hurt the tenants if the development suddenly loses its income restricted status and raises prices to market rent to compensate for the lost subsidies. When you conduct a property inspection between tenants in an income restricted property, be very diligent in reporting even minor damage and disrepair. It is the property manager’s responsibility to make sure the property is fit to safely house tenants before someone new moves in, and the more thorough your report the easier it is for the property manager to do that.