SAVI Reports - Page 34

and accessory dwelling units could provide a market response resulting in more units in desirable locations. Reducing or eliminating caps on density (dwelling units per acre) or mandatory minimums on parking can increase the potential revenue of a project to the point of becoming feasible and attractive to real estate developers. While loosening restrictions on increasing supply may not entirely solve issues of affordability, it could create additional capacity—especially in neighborhoods where economic opportunity is more readily accessible. Some communities have gone one step farther with zoning ordinances, by requiring a certain portion of any new development be priced in such a way that is affordable to individuals of varying income levels (generally set at 80 percent of area median income or some such level). This practice is known as inclusionary zoning. While this tool ensures the provision of affordable housing in new developments, it can make new development less likely if the potential project revenue is reduced. To counter this challenge, some communities have provided density bonuses, which allows developers to build additional units beyond what the zoning ordinance allows in exchange for including affordable units within a project. This regulatory approach to affordable housing development incentivizes the development of affordable housing rather than requiring it. While inclusionary zoning and/or density bonuses are not likely in the near term in Central Indiana, these tools are being utilized in other states as a way to guide the market toward providing more affordable housing. Setting a course for growing Central Indiana’s economy— and positioning housing strategies alongside those goals— could have a greater impact on families than examining housing strategies on their own (or economic strategies solely), coordinating efforts provides a real opportunity to achieve greater impact. People-Oriented Housing Approaches While tenant-based assistance through Housing Choice Vouchers or other subsidies is one way that some families are able to reduce the cost of their housing to a manageable amount, universally reducing the cost of housing in this way is infeasible and impractical. 30