Des Moines affordable housing shrinks as demand rises
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Des Moines doesn't have enough affordable and available housing to meet the needs of its growing population.
Why it matters: With fewer affordable options left, many renters are one unexpected expense away from losing their homes, says Matt Hauge of the Polk County Housing Trust Fund.
State of play: As the Des Moines metro rapidly grows, "naturally occurring affordable housing" is steadily disappearing, Hauge tells Axios.
- These are homes and apartments that remain affordable without government subsidies or rent restrictions, often because of the building's age or condition.
How it works: Since the pandemic, investors have increasingly turned from commercial to multifamily real estate, and they see Des Moines as a market with room to grow, Hauge says.
- Developers will update older apartment buildings, then raise rents to boost revenue.
- "Because Des Moines has historically had lower rents than many other parts of the country, we're looked at as a community with quite a bit of upside," Hauge said.
By the numbers: In the Des Moines metro, a family of four earning less than $34,350 is considered extremely low-income, per the U.S. Department of Housing and Urban Development's FY 2025 limits.
- In 2023, out of Iowa's extremely low-income households, 34% included workers, but the majority were on fixed incomes — 31% seniors, and 24% people with disabilities, per the National Low-Income Housing Coalition.
As of 2022, the Des Moines metro had just 23 affordable and available housing units for every 100 extremely low-income households, according to the coalition.
- That's below Iowa's statewide average of 42 units and the national average of 34.
Zoom in: Naturally occurring affordable housing losses include the Jefferson Apartments, which closed in 2021.
- Krause Group did not immediately respond to Axios when asked about plans for the vacant complex.
- Hotel Randolph also served as a transitional living space for low-income residents until 2013. Now, it's apartments called The Randolph.
What they're saying: Des Moines has fewer affordable housing options because it has a higher concentration of low-income residents, and it's growing faster than much of the state, Hauge said.
- The city's older housing stock makes it appealing, both to families looking for lower rents and to developers eager to renovate and raise prices. Meanwhile, the suburbs have higher-priced, newer homes.
- "In a place like outer Urbandale, it was a cornfield 10 years ago, so there weren't any apartments at all at that lower end of the market," Hauge said.
The bottom line: Polk County is ramping up plans to add more housing as part of a new five-year blueprint addressing homelessness.
- County supervisors approved allocating $10 million in federal funding for affordable housing projects in August.
- On Tuesday, Alley Landing at the former Plaza Lanes site is opening, offering income-restricted apartments and prioritized space for veterans.