eli5: How can they create affordable housing that stays affordable

Question

So a developer working with the government and getting incentives builds a nice neighborhood of homes that people can afford. People in the target income group buy the houses. All good. But when housing prices spike, what keeps the houses in the hands of the targeted economic group. When owner goes to sell, won’t the market dictate what happens, opening up the neighborhood to what has been referred to as gentrification?

In: Other

Answer 1

There’s policy tools out there. For example you could covenant the affordable units so that they can only be sold at below market rates. Or so that they can only be sold to the government.