December 7, 2024

Arizona is facing an ongoing affordable housing crisis, as well as a rise in the number of individuals experiencing homelessness across the state. Despite rising media and political attention to the increasing impact on public life, these complex issues are not easily resolved and require multiyear, sustained community efforts. Thousands of nonprofit organization staff, volunteers, faith-based groups, cities and towns, businesses, and others are working to mount an effective response to the toll the dual challenges that housing unaffordability and homelessness present across our communities. Amidst the individualized, personal tragedies of homelessness, the collective strain on communities working to address housing shortages and increased homelessness, and the recent interest and investment from the Arizona legislature toward tackling these issues, the Arizona Department of Housing (ADOH) has risen to the challenges facing our state. ADOH works across Arizona, with providers rural and urban, on proven solutions and to advance collaborative efforts that address some of our state's most pressing concerns.


Increasing Population, Tighter Statewide Housing Squeeze
With a rise in statewide population of nearly a million residents between the 2010 and 2020 Census, Arizona's reputation for housing availability and affordability has taken a serious hit in recent years. (Pew Charitable Trust's Research on Housing Affordability in Arizona, AZ Family Story​​ citing Elliot Pollack data re: rental increases). New home Construction has lagged behind population growth for years and is expected to remain a challenge in the future.

In the early 2000s, an average of 40,000 units of housing per year were built in Maricopa County alone, with a peak of more than 48,000 units in 2005. After the recession toward the end of the decade, the number of units built dropped to about 6,600 in 2011, according to MAG's Housing Data Explorer. From 2011 to 2022, 254,300 units were built, compared to 389,400 between 2000 and 2010. (2023 Cronkite article on zoning reform) Construction of housing has not kept pace with ordinary population growth, and the state has seen extraordinary growth in resident numbers over the last several years.

With limited supply, housing prices have surged. Huge increases in rental rates have been reported across rental and purchase markets in the last five years (ARCHES 2024 Housing Report, finding rents statewide have gone up 72% from 2010 to 2022 and many would be first-time homebuyers priced out of the market). With a shortage of affordable housing units across the state (recent estimates range from under 100,000 units to nearly 300,000 units), the need for prudent, proven solutions to increase affordable housing supply is urgent.

Given the scarcity of affordable housing across the state, households are squeezed now more than ever. And this has dire consequences for the state's homelessness response system. Families are overburdened by housing costs, leaving little room in their budgets to handle common financial setbacks like job loss, rising living expenses, or medical bills. The scarcity of affordable units makes it harder and more time-consuming for households exiting the homeless system to find permanent housing on a newly stabilized budget. The combination of "easy to fall into" and "hard to climb out of" conditions across the state create an urgent need for collective, statewide action to address the needs of Arizonans. The Arizona Department of Housing has served as a critical convener, coordinator, and catalyst around both issues across the state.

Percentage Change of AZ Median Rent (US Census Bureau, 2010-2022)

Arizona Department of Housing: A Critical Function of State Government and Demonstrated Catalyst for Affordable Housing Development
ADOH is a critical piece of the affordable housing development puzzle, and we urge lawmakers to renew this essential component of our state's government. The Arizona Department of Housing is functionally necessary due to:

• Their essential role in developing affordable housing across Arizona
• Their efforts to address homelessness and provide resources to vulnerable populations
• The department's leadership in managing housing grants, tax credits, and other vital programs that support Arizona's housing stability
• The ongoing housing crisis across our state and the importance of state-level coordination to leverage federal and local resources effectively

According to the 2024 State Auditor General's Report, ADOH distributed nearly $1.27 billion in critical financing, grants, and other programming support to Arizona nonprofits, housing developers, and municipal programs last year. The impact of this state-level coordination cannot be overstated. With a lean operating budget, the Department has a full listing of expenditures for FY2022 and FY2023 for ADOH is captured below (Auditor General's Report, 2024). 

The agency and its staff, despite a massive and unprecedented scaling up of service delivery over the last two years, has remained one of the most responsive agencies in the state. The Department shared results of its work in its 2023 Annual Report and 2024 Annual Report, highlighting the following data on impact throughout the state over the last two years:

• A total of $2.51 billion in state and federal assistance deployed
• Financing was provided to develop 8,639 units of rental housing
• More than 165,000 Arizonans benefited from department resources

As the Department faces its sunset review, the Coalition calls on its members and other stakeholders in housing and homelessness to speak up in support of the continuation of this critical state agency. We urge lawmakers to renew ADOH this legislative session.

Organizational leaders and individuals with experience with ADOH are encouraged to submit a letter of support for renewal. Contact us to learn more about submitting your letter in support of this critical agency.

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