Affordable housing in Milwaukee requires all hands on deck
Affordable housing has long been one of Milwaukee’s greatest challenges. Recent Wisconsin Policy Forum research has found thousands of households spend more than they can afford on rent, evictions are all too common, and homeownership has declined at an alarming rate. Stark racial disparities show that these issues are particularly challenging for the city’s Black and Hispanic populations.
The COVID-19 pandemic has exacerbated Milwaukee’s housing affordability challenges. While the economy has begun to rebound, preliminary data show total employment in the Milwaukee metro area remained down 7.1% in February 2021 compared with February 2020. Reduced employment
has increased the number of households struggling to pay for basic needs such as rent, mortgages and home maintenance.
In April, we published the second of two reports that take stock of the affordable housing work being done in both the public and private sectors in Milwaukee. We analyzed existing programs and activities, surveyed organizations engaged in housing work, and interviewed government and private-sector leaders to determine how various elements of this work are prioritized and the extent to which they are coordinated. This research has illustrated both the complexity of this issue and the need for stronger collaboration and leadership to effectively address it.
Housing in Milwaukee is a multi-faceted challenge
Housing costs are squeezing both renters and homeowners in Milwaukee.
According to the most recent Census data, 53.4% of renter households in Milwaukee are “rent burdened,” which means they spend at least 30% of their income on rent. That is higher than both the statewide and national rates, despite the fact that Milwaukee’s median gross rent ($865 including the cost of utilities) is almost identical to the statewide median ($867) and well below the national median ($1,097).
This finding reveals that low household incomes — rather than exorbitantly high rents — are a primary factor underlying the city’s housing affordability problems.
Milwaukee’s high eviction rate made it the focus of Matthew Desmond’s Pulitzer Prize-winning 2016 book, Evicted, and evictions continue to be cause for concern. Despite a temporary statewide moratorium on evictions early in the pandemic, Princeton University’s Eviction Lab found 8,723 eviction filings were made in Milwaukee in 2020. That was down somewhat from previous years, but many housing leaders fear a spike in evictions could occur when the national moratorium ends on June 30.
Meanwhile, homeownership in Milwaukee has declined considerably and is particularly lacking for people of color. The share of housing units in the city that are owner-occupied declined from almost 50% in 2005 to just 40% in 2019. The most recent Census figures estimate that only 27% of Black households own their homes in the city, compared with 37.5% of Hispanic households and 55.8% of non-Hispanic white households.
Also, as recently discussed by Mike Gousha and John Johnson of Marquette University Law School, as the share of Milwaukee residents who own their homes has dwindled, the number of Milwaukee homes owned by out-ofstate investors has increased.
Milwaukee’s affordable housing landscape
Both the public and private sectors play major roles in developing affordable housing and providing services aimed at making housing more affordable in Milwaukee. Our recent research set out to document and analyze those roles.
On the public-sector side, while the state, county and housing authority are important participants, the City of Milwaukee is arguably the most prominent player. A major emphasis for the city is home repair services. In fact, we found that between 2014 and 2018, city government devoted more resources to those services than to any other housing priority.
There is logic to that approach, as home repair assistance for households with modest incomes is critical to preserving homeownership and also helps maintain the city’s aging housing stock (two-thirds of Milwaukee’s housing units were built prior to 1960). Also, the housing authority, county and state do not provide home repair assistance in Milwaukee, so the city fills a need that otherwise would go unmet.
Using tax increment financing, the city also has increased the amount of funding it dedicates to affordable housing development in recent years and plans to continue to do so in the future.
Our comparison of Milwaukee’s affordable housing programs and strategies with those of three other Midwestern cities (Detroit, Madison and Minneapolis) revealed several ways in which city government might strengthen its housing impact.
For example, unlike Milwaukee, Detroit and Minneapolis have developed strategic plans to prioritize and guide their various housing efforts and have created housing director positions to coordinate efforts and ensure accountability for results. We also observed more concerted efforts in those cities to foster private-sector investment in affordable housing and greater collaboration between those city governments and local philanthropic organizations on priority-setting and investments.
Our analysis of non-governmental affordable housing efforts in Milwaukee included a survey of 47 nonprofit housing service providers and 14 developers. Among six categories of housing activities, affordable housing development was viewed by a majority of respondents (54%) as the area most in need of increased investment.
Local housing leaders we interviewed said investment should emphasize units that are targeted to very lowincome households (those earning less than half of the area median income) and located near suburban employment centers, which may require zoning changes in those communities. Another theme was a need for new and more flexible pools of funding to support affordable housing development, including increased access to financing for emerging developers. Housing leaders also largely confirmed our earlier observation that both the public and private sectors would benefit from greater collaboration with each other and with philanthropic funders.
What’s the way forward?
A couple of central themes emerge from our research. One is that there are several key players in Milwaukee’s affordable housing landscape who have carved out important niches in areas such as home repair, homeownership assistance and affordable housing development, but they have largely done so in a fragmented way. Another is that there are several philanthropic entities looking to build on existing affordable housing efforts, but they are having difficulty gauging which gaps to fill.
Overall, what is missing is a community-driven plan to prioritize and coordinate affordable housing activities in Milwaukee, as well as a leadership structure that can set performance goals and be accountable for success.
The good news is that this challenge has been recognized by public- and private-sector leaders and they are already working to resolve it. In January, the Milwaukee Common Council passed a resolution calling for the creation of a new citywide housing plan. The city’s plan will be rolled into a broader plan being developed by the Community Development Alliance — a coalition that includes local foundations, nonprofits, and leaders from the city and county — that will identify housing priorities, objectives, action steps and accountabilities. The city and CDA hope to complete the plan and begin implementation by the end of this year.
This is an important step forward, though it is important to note that even the best-laid plans only succeed with thoughtful and effective execution and the resources required for implementation. In this case, success also is likely to require efforts that go beyond housing interventions to focus on the fundamental need to raise the incomes of Milwaukee residents and households.
Joe Peterangelo is senior researcher for Wisconsin Policy Forum. Email: jpeterangelo@wispolicyforum.org
According to the most recent Census data, 53.4% of renter households in Milwaukee are “rent burdened,” which means they spend at least 30% of their income on rent.