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Community Development Publication

Affordable Rental Housing in Rural Texas

Needs and Solutions

The Path Forward

Across the country, demographic shifts, tightening lending standards and financial crisis aftereffects have coalesced to boost demand for apartments and, hence, rents. For much of the nation, this upward pressure on rents has increased housing cost burdens because incomes have failed to keep pace. While Texas hasn’t yet experienced increasing housing cost burdens in rural areas, rising rents are still affecting the growing, and aging, rural rental population.

Texas relies heavily on the USDA RD’s Section 515 program to house its low-income, disabled and elderly rural residents: It ranks first in the nation in the number of 515 properties and third in terms of individual units. In addition, Texas is overrepresented in the number of 515 properties set to mature out of the program, potentially shrinking this important resource for rural households.

Given that this resource is at risk, and given the addition of nearly 17,500 rural renter households from 2009 to 2017, Texas is in a critical period for preserving its affordable housing stock. At the same time, multiple models across the country have shown promise in addressing this issue, including the multiagency academy preservation effort in Texas.

Dealing with rural housing affordability will require considerable commitment, work and resources from the government, nonprofit and for-profit sectors. Collaboration through programs like Section 515 is essential to make preservation and rehabilitation projects feasible. A few examples of this exist: Greystone’s Georgia transaction has shown the potential for maintaining financial returns while strengthening communities, and Minnesota’s Interagency Stabilization Group and Texas’ Rural Rental Housing Preservation Academy models illustrate the success that can come from partnerships among multiple agencies.

Housing affordability does not occur in a vacuum—workforce development, job growth, quality education, income support programs and opportunities for enhanced financial capability will all be necessary to ensure inclusive and economically healthy rural communities for generations to come.

  • Andrew Dumont
    Senior Community Development Analyst, Federal Reserve Board of Governors
  • Emily Ryder Perlmeter
    Community Development Advisor, Federal Reserve Bank of Dallas
  • Julie Gunter
    Senior Community Development Advisor, Federal Reserve Bank of Dallas

The full report can be found at

The views expressed in this framework are the author’s and do not necessarily reflect official positions of the Federal Reserve Bank of Dallas or Federal Reserve System.