The poorest individuals in the U.S. are struggling to find affordable homes, with many unable to afford even the most basic housing options. Mathew Davis, 49, lives in a homeless shelter in Austin, Texas, and earns about $450 a month from donating blood plasma. This income makes it nearly impossible for him to afford a tiny home with no running water and a shared bathroom, which costs $450 a month. In Austin, over 4,500 affordable housing units remain unoccupied, with a vacancy rate of nearly 16%, according to real estate data firm CoStar. A healthy vacancy rate is typically around 5%, indicating that these units are not being used by those who need them most. According to a survey of state housing agencies, most low-income housing built in recent years is intended for people earning at least 50% of an area’s median income. In Austin, that translates to a single person earning roughly $47,000 a year, while extremely low-income individuals earn under $28,000. The National Low Income Housing Coalition reports that there are only about 4 million affordable rental units available for the country’s 11 million extremely low-income renter households. These households include people with incomes below the federal poverty guidelines, seniors, and those with disabilities living on fixed incomes. Most of these families pay over half their income on rent and utilities, leaving little for other basic needs. The Low-Income Housing Tax Credit (LIHTC), a federal program that provides tax incentives to developers in exchange for keeping rents low for at least 30 years, has financed nearly 4 million affordable units since its creation 40 years ago. However, only about 12% of the units financed in 2024 were set aside for extremely low-income renters. Most of the LIHTC-funded units are for people earning at least 50% of the area’s median income. Some experts argue that the program is inefficient and costly, creating a complex bureaucracy that raises construction costs. Others believe it works well with housing vouchers, which allow low-income families to rent from private landlords. However, only about one in four eligible families receives vouchers, and the waitlists can be years long. In cities like Austin, Denver, and Portland, affordable housing for lower income groups is increasingly competing with market-rate apartments. In Austin, the vacancy rate for affordable housing is nearly 16%, with over 4,500 units unoccupied. Many of these units are priced close to market-rate apartments, which can be rented with fewer verification steps and faster approvals. For the poorest residents, like Mathew Davis, the lack of affordable housing is a daily struggle. Davis, who lived in his car for a year before finding shelter, said he just wants to find a place where he can shut the door and sleep at night. Austin officials have set a goal of building 20,000 units for extremely low-income residents by 2027, but as of 2024, only 543 such units had been built. The city is now taking steps to prioritize housing for the poorest residents, including favoring proposals that include units for those earning 30% of the area’s median income.