The mayor continues to fib on affordable housing
Mayor Brandon Johnson has been actively touting affordable housing initiatives, especially his Green Social Housing program and the related $1.25 billion housing bond. In reality, little has been accomplished in affordable housing, and the mayor’s policies risk making it even more expensive.
In a since deleted X post, Johnson claimed the city “invested $11 billion” to “build 10,000 more units of affordable housing” — a cost of $1.1 million per unit. It was debunked, but the mayor thought-fit to brag about this number. In reality, new housing development in Chicago has been minimal, especially affordable units.
The city’s own data on building permits reveals the truth regarding the number of units of affordable housing built:
- Over 50 percent of all new residential permits in 2024 were concentrated in just four wards (27th, 34th, 3rd, and 4th). With 50 wards in total, how is this equitable? What about the other 46 wards?
- Chicago issued only 4,039 new residential building permits in 2024, including a mere 321 single-family detached homes. By comparison, Houston issued 52,000 residential permits last year.
Chicago consistently ranks among the lowest five or six major metropolitan areas in both single-family and multi-family housing permits. None of the 10 largest homebuilders in America, who build roughly a quarter of all U.S. housing annually (300,000–400,000 units), operate in Chicago or Cook County. The mayor’s affordable housing efforts so far amount to awarding $324 million in subsidies to politically connected developers, resulting in only 505 affordable units.
Mayor Johnson’s $1.25 billion housing bond continues the city’s tradition of financing capital projects through bonds, but it is smaller and offers less oversight than his predecessor’s. The mayor’s $125 million “Green Social Housing Ordinance,” which is funded from the bond, is essentially a low-interest loan program for politically connected developers. This is no substitute for a comprehensive affordable housing policy. These initiatives amount to “check-the-box” efforts in housing and environmental policy.
The mayor's so called “cut the red tape” initiative which offered 100 recommendations for streamlining processes and eliminating government-made barriers to affordable housing, has resulted in few meaningful changes. The suggestions had bipartisan support from policy experts and seemed universally supported by Chicagoans. There’s been little progress as the the city has yet to adopt any of the most meaningful reforms and recommendations.
On the contrary, there are new barriers emerging to the building of not just affordable housing but housing in general. For example, what might the potential costs be of the green building standards and how would it limit the new city loan program. Green building standards such as those set in California's Green Building Standards Code (CALGreen) mandate solar panels, water conservation, sustainable materials, and improved indoor air quality. These regulations significantly increase construction costs, making housing even less affordable.
The city’s new “Northwest Side Preservation Ordinance” will make expanding building affordable matters worse. Pitched as a way to protect housing that qualifies as affordable, it just makes those properties harder to buy and sell. By imposing costly delays, intrusive financial disclosures, and pushing up demolition fees, the Northwest Side Preservation Ordinance will drive rents even higher and hurt the residents it aims to help while discouraging new housing investments.
Meanwhile, the Chicago Tribune recently noted that one particularly "woke" rule is causing every housing project to grind to a halt while developers work to satisfy its requirements. With this rule, City Hall requires every developer to supply an economic disclosure statement for all parties involved to show proof that their companies have no history of making money from slavery prior to the Civil War. This is a costly requirement in not only the inordinate amount of research required but also in project delays.
The rising cost of government
Rising government costs are driving housing unaffordability, with ever-increasing property taxes forcing residents from their homes. The Civic Federation reported that Chicago’s property tax burden rose by $2.7 billion, or 53.3 percent, between 2014 and 2023, with 56 percent of revenues directed to a school system. The Illinois Policy Institute reported that since 2007, homeowners’ property taxes have grown at 10 times the rate their incomes grew.
Expanding housing requires unleashing the market while reducing the costs of ownership and renting. The following strategies can help drive both supply and affordability.
Cutting the red tape to create more housing
No amount of taxpayer-funded subsidies can cancel out onerous zoning laws and the costs of endless red tape. New construction projects routinely take years to receive final approval. The most promising reforms focus on easing restrictions to build more and more diverse housing types.
Reforming rules on granny flats and other alternative housing units on single-family lots could add much-needed low-cost housing. Removing the barriers to converting unimproved space to garden units is also essential. There are approximately 130,000 apartment buildings with potential space for such conversion.
Chicago must drastically reduce land-use regulations. Over 40 percent of the city’s land is zoned exclusively for single-family housing. Allowing property owners to build additional units, duplexes, and triplexes in these areas would significantly increase the affordable housing supply.
Shortening approval times for new developments is also critical. About 17 percent of zoning license applications were returned due to insufficient information, and over 1,300 buildings required more than three inspections annually, according to a Harvard Kennedy School study. Such bureaucratic hurdles stifle housing production.
Reclaiming existing unoccupied housing
Chicago can partner with local developers and community organizations to renovate thousands of vacant homes for middle- and low-income families and to address special needs such as temporary housing for domestic violence victims, individuals with addictions, returning citizens, and immigrants.
The U.S. Census Bureau reports over 103,000 vacant housing units in Chicago, with more than 13,000 abandoned or in need of repair. Engaging landlords to convert unused spaces into affordable units could be incentivized by removing barriers and streamlining approvals.
Creating a tax structure that encourages affordable housing
Numerous programs exist to reduce property tax impacts through exemptions, credits, grants, or deferrals, but these are often complex and require annual renewal, burdening especially the elderly. A simple, one-stop process for access and renewal is needed, along with foreclosure protections for families and seniors.
With the return of Donald Trump to the White House, Chicago can expect renewed emphasis on Opportunity Zones — federal tax incentives created in the 2017 Tax Cuts and Jobs Act. These zones encourage investment in designated low-income areas by offering capital gains tax advantages. Between 2017 and 2020, Opportunity Zones generated $48 billion in equity capital for targeted communities.
Strategic property tax abatements can encourage restoration and conversion of residential properties into affordable units. Longer-term tax-exempt status should be offered for housing, addressing specific needs such as temporary shelters for homeless families, domestic violence victims, and those in rehabilitation or transitional programs.
Addressing gentrification
While these measures will boost affordable housing, the city must also address gentrification driven by unchecked development and rising property taxes. Imposing caps on local property taxes for individual residential and commercial properties is essential to protect at-risk neighborhoods.
Tax caps enable residents to benefit from rising home values, encourage small business growth, and foster job opportunities without triggering sharp rent and home price increases. Revenue loss would be offset by increased housing supply and improvements. Economic growth is a healthier alternative to raising taxes.
A city “Affordable Housing Trust Fund” can be established and financed through existing developer fees, a share of tax increment financing surpluses, housing-related fees and fines, or dedicated revenue from legalized gaming. Additional funds could come from bonds backed by future revenues from retired tax increment financing districts. The Johnson administration infrastructure bond is funded that way, but a portion of proceeds must be guaranteed for the housing trust.
In sum, Mayor Johnson’s claims of affordable housing investment is pure fantasy as his current approach does virtually nothing to address Chicago’s affordable housing crisis. Real progress requires market-friendly reforms, streamlined regulations, smarter tax policies, and effective use of existing institutions and resources. Without these, housing will only become less affordable for Chicagoans.
