HIP Tool: Public Land for Affordable Housing

Local governments can facilitate the development of affordable housing by making public land available for eligible projects. Parcels may be surplus or underutilized public properties, as well as vacant, abandoned, and tax-delinquent private properties acquired through purchase or tax foreclosure. Land banking programs can strategically acquire and preserve multiple properties for affordable housing development.


Background

Local governments, transit agencies and special districts may own property that is no longer useful for its original purpose, or is ideally situated for shared public and private uses (e.g., transit-oriented development on construction staging or transit station sites). The agency may sell surplus property, prioritizing the development of affordable housing. Some agencies have assembled properties in order to co-locate transit facilities, civic buildings or other purposes, as well as to attract mixed-use housing and commercial development to support neighborhood revitalization.

Cities or agencies can help assemble adjacent vacant or underutilized properties from private owners to sell as a package for larger developments. Fragmented individual properties may be collected to sell to individuals, but developers are generally interested in larger properties. This program is commonly called “land banking.” Larger parcels can be segmented to create lots that would result in denser urban development. By collecting the land under one owner, the city or agency can resolve confusing ownership issues and remove land encumbrances that would add legal costs for the developer or deter redevelopment altogether. 

The Municipal Research and Services Center of Washington notes that the state constitution generally restricts cities and counties from giving property to private individuals or from offering it for less than fair market value (Article VIII,7). However, many cities and counties can donate or sell surplus property for less than market value if the property would be used to directly benefit the “poor and infirm.” Alternately, for publicly owned land in neighborhoods with increasing market demand or recent public investment, jurisdictions can sell land at market price to affordable housing developers before increases in value are realized in the price of the land. A city can offer lots to private developers for fair market value. Cities may also use eminent domain to acquire property for public purpose.

Tool Profile

Focus Areas

  • Urban Centers
  • Transit-Oriented Development
  • Expensive Housing Markets
  • Innovative Single Family Techniques

Project Types

  • Single Family
  • Multifamily
  • Ownership
  • Rental
  • Subsidized

Affordability Level

  • 80 to 120% AMI
  • Less than 80% AMI

Housing Goal

  • Affordability