Walker & Dunlop

Forty-year-high inflation rates that are outpacing wage growth and eating away at personal income are exacerbating already outsized resident demand for affordable housing financed by the federal Low-Income Housing Tax Credit (LIHTC) program. But it seems that obstacles to supplying new units to meet that demand are only multiplying. Those range from a shortage of housing tax credits needed to fund new supply to resistance to multifamily development at the local level. Meanwhile, higher mortgage rates are making home buying more difficult and expensive. In turn, that is creating more apartment renters, thereby putting upward pressure on rental rates. In September, for example, the average monthly rent price nationwide hit $1,759, an increase of 7.8 percent from the prior year, according to Realtor.com’s monthly rental report. That’s also nearly 25 percent higher than September 2019, the organization reports. What’s more, from 2015 through 2020  — long before mortgage rates spiked — the U.S. lost 4.7 million apartment units with rents less than $1,000 per month, according to U.S. Apartment Demand Through 2035, a report by the National Multifamily Housing Council and National Apartment Association. “Demand for affordable units is only going to become more acute between now and the end of …