Housing in America is broken and there are no easy fixes.
That’s one reason philanthropy hasn’t jumped in to make housing a primary focus of their work. But increasingly grant makers are doing more, especially those that work to solve problems with education, health, and economic opportunity. They recognize that stable housing is fundamental and that if people don’t have safe, affordable places to live, it’s difficult to help them make progress in the rest of their lives.
“People need a place to live in an area that’s decent, has access to opportunities, and allows them to thrive,” says Susan K. Thomas, president of the Melville Charitable Trust, which concentrates its grant making on preventing and ending homelessness. “It’s as simple as that.”
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That’s one reason foundations haven’t jumped in to make housing a primary focus of their work. But many individual donors and grant makers are doing more, especially those that work to solve problems with education, health, and economic opportunity. They recognize that stable housing is fundamental and that if people don’t have safe, affordable places to live, it’s difficult to help them make progress in the rest of their lives.
“People need a place to live in an area that’s decent, has access to opportunities, and allows them to thrive,” says Susan Thomas, president of the Melville Charitable Trust, which concentrates its grant making on preventing and ending homelessness. “It’s as simple as that.”
Grants to help low- and middle-income people buy and rent homes, prevent foreclosures, and build and renovate housing represent a small fraction of foundation giving, according to data from Candid. From 2006 to 2019, the 1,000 largest foundations gave more than $2.8 billion to groups focused on housing development and services — just 1 percent of their domestic grant making during that time. Most of those grants were made by just a handful of foundations.
Because the housing crisis has many causes that demand a multitude of solutions, grant-maker strategies continue to evolve. Money is going to support policy change, advocacy, and program testing to see what works in the real world. Some foundations are looking beyond grant making, using a variety of financial tools to jump-start housing development.
Before the Great Recession, sparked by the burst of the housing bubble in 2008, some of the nation’s wealthiest foundations, including Ford and MacArthur, spent hundreds of millions of dollars experimenting with ways to help some renters buy their own homes and keep housing costs low.
Because the housing crisis has many causes that demand an array of solutions, grant-maker strategies are evolving.
As the economy stabilized, the top foundations largely pulled back from their focus on helping more people buy homes and preventing foreclosures. Some grant makers supported research to show why affordable housing matters for health, education, and economic opportunity.
More recently, grant makers have turned their attention to helping renters who are most in need. Some of the wealthiest foundations, for example, have supported groups that help organize tenants as they push for eviction protection and policy changes to keep rents affordable. The poorest 20 percent of households struggle to afford to rent a home no matter where they live.
Though more resources are focused on renters today, some foundations continue working to increase homeownership among Black and brown people as a way to close the racial wealth gap.
In 2019, in response to what leaders viewed as a growing crisis, Wells Fargo pledged $1 billion to make housing more affordable with contributions from its business and corporate foundation. As part of that commitment, Wells Fargo Foundation awarded $22.5 million to the nonprofit Local Initiatives Support Corporation to help Black, Hispanic, and other people in New York, Houston, and Richmond, Va., buy homes.
Meanwhile, Habitat for Humanity, one of the largest builders of low-cost homes, is also advocating for policies that increase racial equity in housing. Last year, when MacKenzie Scott gave Habitat $436 million, leaders pledged to use a portion of the funds to increase Black homeownership and work to remove financial roadblocks that make it difficult for people of color to buy homes.
While large-scale solutions to housing problems will require major public-policy changes, philanthropy can also play important roles, says George McCarthy, CEO of the Lincoln Institute of Land Policy, a think tank in Cambridge, Mass.
As a Ford Foundation official who oversaw grants to promote economic mobility in cities through the early 2000s, McCarthy led an effort that helped tens of thousands of low-income families get affordable mortgages and become homeowners. He’d like to see more foundations today invest the time and money to try other new ideas that might work on a large scale.
Among the approaches that are gaining traction with grant makers and housing experts:
Address the connection between income and housing. One of the most direct ways to help people afford housing is to give them more money, says Jenny Schuetz, a senior fellow at the Brookings Institution, a Washington think tank, and author of Fixer-Upper: How to Repair America’s Broken Housing Systems. Among the efforts underway: Grant makers including the Melville Charitable Trust and Kresge Foundation have backed the nonprofit Economic Security Project, which seeks to provide cash to low-income people. One of those programs, Magnolia Mother’s Trust, run by the nonprofit Springboard to Opportunities, provides low-income Black mothers living in federally subsidized housing in Jackson, Miss., with $1,000 a month for a year. Many participating moms aspire to improve their housing situation, and several have been able to move into market-rate rentals or purchase a home.
Push for housing-friendly policies. Local regulations and resistance from people who live in neighborhoods sought after for low-cost homes often get in the way of building more housing. Philanthropy has tried to change land-use regulations that restrict where housing can be built, especially in metropolitan areas where new homes are needed most. Open Philanthropy, a grant-making group started by Facebook co-founder Dustin Moskovitz and his wife, Cari Tuna, for example, has supported California YIMBY — Yes in My Back Yard — which helps advance legislation to make it easier to build housing. The group also supports YIMBY Law, which monitors how cities and counties apply state and federal housing laws and sues jurisdictions that fail to comply.
Help the public better understand why people can’t afford homes. Philanthropy is supporting nonprofit journalism, communications research, and public information campaigns to change policy and public opinion. Similar strategies were used to help change laws and thinking about same-sex marriage, seat belts, and tobacco use. Funders for Housing and Opportunity, a group of foundations, funded a three-year effort to develop messages that help advocates explain that housing is a common good rather than a commodity and access to housing is a racial-justice issue.
Thomas, of the Melville Charitable Trust, which helped create the housing donor group Funders for Housing and Opportunity, says philanthropy has a vital role in exploring new ways to solve the housing crisis. But she adds that “philanthropy needs to be challenged in the way that it’s looking at housing.”
Housing “is not a project. It’s not a program. It is fundamental to being able to do anything else,” Thomas says.
In this special report, we examine projects that have the potential to make a dent in the housing crisis if they have funds to expand.
We look at:
- Community land trusts, which offer homes at low rates.
- Houses of worship that are building housing on property they no longer need.
- Tenant groups that are pressuring cities and counties to protect renters against unjust evictions, poor living conditions, and more.
- Community-development financial institutions, which often dedicate much of their resources to expand access to housing to people with low or moderate incomes.
Reporting for this article was underwritten by a Lilly Endowment grant to enhance public understanding of philanthropy. The Chronicle is solely responsible for the content. See more about the Chronicle, the grant, how our foundation-supported journalism works, and our gift-acceptance policy.