Affordable Housing is Key as Houston Adds More Renters
As the Houston population grows, more affordable rental housing is needed to support residents
Houston, the fourth most populous city in the U.S., continues to grow denser. An April 2023 analysis of Census data by the Greater Houston Partnership found the Houston metro area gained about 125,000 residents in 2022. According to the analysis, these population gains were driven both by new residents moving to the region and a positive natural increase.
At the same time, a 2022 RentCafe study showed that six Houston zip codes were among those that shifted from housing a majority of homeowners to serving a majority of renters. Between 2011 and 2020, the number of Houston renters increased by more than 62%.
These two trends are converging amidst the nationwide affordable housing shortage. In 2023, Texas state legislators took action to stem the shortage by introducing a state Low Income Housing Tax Credit (LIHTC) program that allows the Department of Housing & Community Affairs to issue state tax credits. This program complements the federal LIHTC program and other public-private partnerships designed to deliver affordable housing to those who need it.
Through our experience providing LIHTC equity investments, debt financing, and Fannie Mae, Freddie Mac and FHA financing, Capital One is helping to position Houston for current and future resident needs. Between 2018 and 2022, Capital One has supported the development of over 30,000 affordable housing units in Texas. And in 2024, Capital One financed two new construction, affordable seniors housing developments in the Houston area.
Supporting Houston Seniors with Affordable Housing
Capital One financed Campanile on Minimax (pictured above) through a federal LIHTC equity investment and HUD 221(d)(4) loan. Campanile on Minimax will be a 117-unit mixed-income development for residents who are 62 years or older. Once construction is complete, the property will reserve 93 units for residents making 30%, 50% and 60% of area median income.
Deeply affordable units will be available and marketed to households with special housing needs, for example, formerly unhoused families or individuals, veterans, individuals with different mobility capabilities, and individuals with different hearing or visual needs.
As part of the resident experience, Campanile on Minimax will offer services ranging from health and wellness to financial inclusion, including health screenings, credit counseling, social events, and health and nutrition courses.
In 2024, New Hope Housing Ennis (pictured at top of page) broke ground and will provide 102 units of affordable seniors housing in downtown Houston. NHH Ennis will provide 11 units of deeply affordable housing for individuals with household incomes below 30% of AMI with the remainder of the units available for those with household incomes below 50% and 60% of AMI. Capital One originated both a LIHTC equity investment and construction loan to finance the development, which also received funding from Harris County and the City of Houston.
NHH Ennis residents will benefit from case management, emergency assistance and financial support services, in addition to a free transportation service in partnership with Houston METRO.
Longstanding Involvement with the Houston Community
In 2017, Hurricane Harvey made landfall in Texas and caused about $125 billion in damage, destroying homes, apartment buildings and infrastructure. The Harris County Flood Control District estimated that 155,000 homes flooded in Harris County and between 5,000-15,000 rental units flooded.
As recovery efforts were underway, the City of Houston deployed Community Block Development Grant - Disaster Recovery funds toward the development of Somerset Lofts, a 120-unit property in Northeast Houston. Capital One also provided capital in the form of a LIHTC equity investment, debt financing and permanent Fannie Mae financing.
Located six miles from downtown, Somerset Lofts serves households earning between 30% and 60% AMI. Among those units, 10 are set aside for very low income households with different physical or mental capabilities who are in need of community-based, long-term care services.
“Quality affordable housing can drive positive impacts for residents in all aspects of their lives – from enhancing financial security to improving health outcomes,” said Donna Rickenbacker, developer with MREC Companies. “Somerset Lofts residents have benefited from onsite services and events such as financial planning, health fairs, nutritional and exercise classes.”
Meeting Current and Future Community Needs
Creating and preserving affordable housing is a critical component of building an inclusive, thriving Houston community. Beyond housing, Capital One is working to close the gaps in equity and opportunity for Houstonians, including small business owners who are core to the local economy.
Capital One provided a line of credit and philanthropic investment to PeopleFund, a community development financial institution (CDFI) that creates economic opportunity and financial stability for underserved individuals and communities across the state of Texas. PeopleFund provides access to capital, education and resources to build healthy small businesses.
For more than a decade, Capital One philanthropic investments have supported all facets of the CDFI’s work, including the development of an online business mentoring platform that connects entrepreneurs with volunteer business mentors, financial and technical assistance to businesses, and a Small Business Accelerator that helped participants – including women and veterans – increase access to capital.
Learn more about how Capital One is improving communities across the country with solutions that address affordable housing needs and goals.