The area median income, or AMI, for the San Antonio-New Braunfels region has increased from $72,000 to $74,100 for a family of four, according to the latest figures released by the U.S. Department of Housing and Urban Development (HUD).
For some housing observers, the new increase in AMI prompts questions about affordability: If the AMI continues to rise every year, and housing programs adjust their rent prices accordingly, will you see a proportional increase in your paycheck?
But what is the area median income, exactly, and why does it matter?
If you were to set every household in the San Antonio-New Braunfels region on a line, ordered from highest annual income to lowest, the AMI would represent the income of the center household.
2021 Area Median Income
|1 person||2 person||3 person||4 person||5 person||6 person|
|Source: U.S. Department of Housing and Urban Development|
San Antonio-New Braunfels’ AMI has steadily risen since 2016, climbing from $62,100 to the current $74,100. The largest increase occurred in 2019, when the AMI jumped from $66,800 to $71,000—a whopping 6.3%.
The area median income (AMI) for a family of four in the greater San Antonio area (Bandera, Bexar, Comal, Guadalupe and Wilson counties) has steadily increased the past six years:
» 2021 — $74,100
» 2020 — $72,000
» 2019 — $71,000
» 2018 — $66,800
» 2017 — $63,500
» 2016 — $62,100
» 2015 — $63,400
» 2014 — $58,800
» 2013 — $61,300
» 2012 — $60,800
» 2011 — $59,900
Source: U.S. Department of Housing and Urban Development
Programs described as “affordable housing” typically use AMI to reserve a certain number of apartments for people making up to 80% AMI. This gets lower-income residents in the door. What they pay in rent depends on how the property is set up in relation to the government incentive program they used to help build the apartments. In some cases, a household’s AMI helps determine what rent limits they may be eligible for—but not always.
At the controversial Friedrich Lofts project on the East Side, which was recently approved by the San Antonio Housing Trust Public Facility Corp. (PFC) board, there are no rent limits, because that’s the way that deal was set up between the PFC, its developer and its equity provider. (It should be noted that the Housing Trust PFC is governed by five City Council members.) However, moving forward, future Housing Trust PFC projects will adhere to rent limits issued by HUD each year.
Market-rate housing is often defined as housing affordable to anyone making between 80%-120% of the area median income.
Habitat for Humanity, a non-profit organization that helps provide secure housing for low-income families, uses the AMI to determine families’ eligibility for the program. Families making in between 20%-70% of the AMI have access to Habitat’s resources, according to their website.
According to Habitat for Humanity San Antonio CEO Natalie Griffith, though, the increase in AMI won’t change the community they serve.
“We’re trying to reach those most in need, so for us it’s rare to have families making over 70% of the AMI.” Griffith said. “The bulk of our families are in the 30%-60% range.”
[ Related: Why AMI is important ]
Perspectives on HUD’s AMI are divided. Supporters of the AMI increase argue that a higher AMI will allow more people to receive benefits from government-sponsored programs that use AMI as a benchmark. Opponents say that the inclusion of wealthier communities like New Braunfels in the calculation of AMI paints an inaccurate picture of what the average San Antonian actually makes.
For example, a family of four making 80% AMI, or $59,280, should be able to afford an apartment priced at $1,482 per month, if they spend 30% of each paycheck on housing—which is how HUD defines affordable housing.
But according to the U.S. Census Bureau, the median income for just San Antonio alone was $53,751 in 2019, which would put the monthly housing costs, if using HUD’s definition, closer to $1,075 for a household making 80% of the bureau’s figure.
Others, like Griffith, believe that we ought to focus less on the number value of the AMI and more on individual circumstances when we talk about housing inequality and affordability.
“I think sometimes we’re spending way too much time talking about the actual AMI as opposed to talking about the people, and what their real situations are,” Griffith said.
The San Antonio-New Braunfels region has the lowest AMI of the major Texas markets for 2021:
» Austin-Round Rock — $$98,900
» Dallas — $89,000
» Fort Worth-Arlington — $80,800
» Houston-The Woodlands-Sugar Land — $79,200
» San Antonio-New Braunfels — $74,100
Source: U.S. Department of Housing and Urban Development
The late Michael E. Stone, a professor of community planning at the University of Massachusetts-Boston, looked at housing affordability in a similar way.
Antithetical to HUD’s definition of affordable housing, Stone said the cost of meeting non-housing needs should be subtracted from a household’s disposable income (after taxes). What remains is what the household can afford to spend on rent or a mortgage.
“For all low-income families, and many moderate-income families, paying 30% (or even 25%) of their limited income for housing does not leave them with enough money to meet their other needs,” Stone wrote in the New England Journal of Public Policy in 2004. “On the other hand, many high-income households actually have no hardship even if they pay considerably more than 30% for housing.
U.S. Department of Housing and Urban Development’s definition of affordable housing
Michael E. Stone’s affordable housing formula
It’s important to understand AMI and how it works so you can make your own judgments about what housing is affordable, and whether or not these units are a viable option.
Staying informed about the current AMI, and how it affects housing prices is especially important in a time when terms like “workforce” and “affordable housing” are used without regard for what they’re actually supposed to mean. Knowing what the AMI is and how it works provides you with an extra layer of security against misinformation or, sometimes, disinformation, about “affordable housing” and helps you to break through the jargon.
San Antonio native Maggie Ryan is pursuing a bachelor’s of arts in English Language and Literature/Letters at Hendrix College in Conway, Arkansas. She is interning at the Heron through Students + Startups, a program by the 80/20 Foundation that pairs undergrad students with local companies and nonprofits. She can be reached at email@example.com or @m_rrye on Twitter.
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