How to Determine if Property is a “Deal” for Affordable Housing Development ft. Austin Richardson
How to Know if a Property is a “Deal” for Affordable Housing Development
Featuring Austin Richardson, VP of Development at GW Development Group
On The Affordable Housing & Real Estate Investing Podcast, the best podcast for affordable housing investments hosted by Kent Fai He, we sat down with Austin Richardson, a former medic turned affordable housing developer who now serves as VP of Development at GW Development Group.
Austin’s story is a reminder that affordable housing isn’t just about numbers and financing — it’s about purpose, persistence, and partnerships. After years in construction and service in the Army National Guard, he pivoted into development to continue his mission of helping people, only this time through housing.
In this episode, Austin explains exactly how developers evaluate whether a property is a true “deal,” why public-private partnerships are essential, and how community-driven relationships can make or break an affordable housing project. For investors, developers, and city leaders, this conversation breaks down the tactical side of making projects pencil — from LIHTC to land trusts to local funding sources.
What Does a Developer Actually Do?
Most people think a developer is just a builder. Austin quickly clears that up.
“A developer isn’t the person swinging the hammer,” he said. “We’re the ones putting the puzzle pieces together — land, financing, partnerships, and community support.”
That puzzle includes:
Land acquisition and due diligence
Financial structuring, including tax credits and soft debt
Community relationships with cities and nonprofits
Construction coordination with contractors and engineers
Austin explains it like this: “Once every piece fits — that’s when the project truly starts.”
How Can Developers Build Trust with Cities and Communities?
In affordable housing, relationships are the real capital.
Austin says too many developers walk into city meetings ready to sell instead of ready to listen.
“Don’t show up saying, ‘Here’s my project, you’re going to love it,’” he said. “Instead, ask the city, ‘What do you need? What does your community want?’ Let them feel ownership in the process.”
That’s how partnerships form. When cities believe they helped shape a project, they’ll help you find ways to fund it — through fee waivers, land donations, or local housing trust funds.
And those relationships pay off for decades. “You’ll probably own that affordable property for 30 or 50 years,” Austin added. “So build partnerships that last just as long.”
What is a Public-Private Partnership and Why Does It Matter?
Austin defines public-private partnerships (PPPs) as collaboration between developers and local governments to close the financial gap on deals that otherwise wouldn’t pencil.
He breaks down common levers developers can pull:
Community Land Trusts (CLTs) – Cities or nonprofits that buy land and lease it back to developers, removing or reducing property taxes for up to 99 years.
CDBG, HOME, or Housing Trust Funds – Local programs that provide gap funding, often as 0% loans or forgivable grants.
Waived Fees & Infrastructure Credits – Cities may waive impact fees, expedite permits, or contribute land to reduce costs.
“A land trust alone can change the economics of a deal,” Austin said. “You’re removing one of the biggest expenses — property taxes — and replacing it with a ground lease that’s manageable.”
These creative partnerships allow affordable housing projects to move forward without depending solely on federal tax credits.
How Do Developers Use Tax Credits to Finance Affordable Housing?
Austin offered a masterclass explanation of Low-Income Housing Tax Credits (LIHTC) — the backbone of affordable housing finance.
9% Credits: Provide roughly 60% of project equity, highly competitive, best for new construction or smaller deals.
4% Credits: Provide about 30% equity, typically paired with bonds and local subsidies, better for rehabs or large-scale developments.
He also emphasized the importance of Qualified Census Tracts (QCTs) and Difficult to Develop Areas (DDAs) — regions that qualify for a 30% “basis boost.”
“That 30% boost can make or break your project,” Austin explained. “If your basis is $17 million, the boost adds another $5 million in eligible credit value. You almost can’t make deals work today without it.”
For developers, this means learning how to read your state’s Qualified Allocation Plan (QAP) and locate QCT/DDA maps to target high-opportunity zones.
How Can You Tell if a Property is Actually a “Deal”?
Here’s where Austin’s process shines. When someone sends him land, he immediately looks for three key indicators:
Location Quality (QCT or DDA): Is the property in a qualified area with a basis boost potential?
Zoning and Density: Does it already allow enough units to support the cost, or will rezoning be required?
Funding Feasibility: How large is the financial gap after tax credits and loans?
If the pro forma shows a gap that’s realistically fillable through local funding (for example, $5 million in a city like Nashville), he’ll pursue it. But if the same gap exists in a rural town with no available funds, he’ll walk away.
“It’s not emotional,” he said. “In Butte, Montana, a $5 million gap is a deal killer. In Nashville, it’s probably doable.”
He uses a detailed pro forma template to estimate total costs, expected rents, and achievable financing — all within minutes.
That process weeds out unrealistic opportunities fast, saving time for both developers and cities.
Why Developers Should Think Beyond the Spreadsheet
Austin reminds listeners that success in affordable housing isn’t just about math. It’s about leadership, curiosity, and humility.
“Ask questions,” he said. “There’s no such thing as a stupid one. You’ll be shocked how often people don’t know the answer either — even professionals. The good ones will say, ‘Let me check with my team and get back to you.’”
Kent echoed the point: “Sometimes you don’t need more spreadsheets — you need better conversations.”
Austin’s approach is simple: lead with curiosity, listen to the community, and let them co-author the vision. That’s how affordable housing gets approved — and stays supported.
Key Insights & Frameworks
Ask before you act. Talk to cities, counties, and corporations before finalizing plans.
Look for funding layers. Combine tax credits, land trusts, and local funds.
Use QCT/DDA maps. Target deals with the 30% basis boost.
Run quick pro formas. Determine feasibility early using realistic assumptions.
Let the city lead. Build partnerships that feel mutual, not transactional.
Best Quotes from Austin Richardson
“Every property can be developed. You just have to think differently about how, why, and with who.”
“A community land trust can erase your property taxes and make a dead deal come alive.”
“Don’t sell your project to the city. Ask them what they need and let them be part of the idea.”
“You don’t always need more data. You need better questions.”
“If you’re $5 million short in Butte, it’s dead. If you’re $5 million short in Nashville, you still might have a deal.”
Common Questions About Affordable Housing Deals
Q1. What’s the first thing to check when analyzing land for affordable housing?
Check if it’s located in a Qualified Census Tract (QCT) or Difficult to Develop Area (DDA). These areas qualify for a 30% basis boost, which can add millions to your project’s equity.
Q2. How do I find local housing funds or incentives?
Contact the city’s housing department or redevelopment agency. Many cities have local trust funds or ARPA allocations specifically for affordable housing projects.
Q3. What’s the difference between 4% and 9% tax credits?
9% credits provide more equity but are competitive. 4% credits provide less but can be combined with bonds or other subsidies and are often non-competitive.
Q4. Why are community relationships so important?
Because affordable housing is long-term. Developers often own and manage properties for 30+ years. A good relationship with city leaders makes future collaboration and problem-solving much easier.
Q5. How can I make my land more attractive to developers?
Do the homework first. Verify QCT/DDA status, check zoning, contact the city about potential funding, and include all that info in your listing. Developers value initiative.
Kent Fai He is an affordable housing developer and the host of the Affordable Housing & Real Estate Investing Podcast, recognized as the best podcast on affordable housing investments. Each episode brings actionable insights from the field, helping cities, investors, and advocates close the housing gap one project at a time.
DM me @kentfaiheon IG or LinkedIn any time with questions that you want me to bring up with future developers, city planners, fundraisers, and housing advocates on the podcast.
