Indiana Faces Shortage of Affordable Housing

A walk-in shower with a grab rail, a no-threshold front door, an entrance ramp.

Siblings Louise Dixon and Jack Perkins Jr. look forward to accessible living for years to come when they move from their Evansville apartment into a Habitat for Humanity home next year.

Construction on the Americans With Disabilities Act–compliant house, cosponsored by AARP Indiana, starts this fall. Dixon, 70, and Perkins, 75, will pay an affordable mortgage for the three-bedroom home and live there with a 12-year-old relative Dixon has raised since he was a baby.

The new home is among various efforts AARP Indiana is undertaking to help address a statewide shortage of affordable housing. Other steps include advocating for zoning adjustments and local and state initiatives aimed at diversifying Indiana’s housing stock.

“We have reached a point of crisis,” says Ambre Marr, AARP Indiana’s state legislative director.

AARP provided $90,000 to the Habitat project. More than 20 AARP volunteers and staff will help with the construction.

Beth Ann Folz, Habitat for Humanity of Evansville’s executive director, says the number of 50-plus applicants has grown in recent years and now accounts for about 20 percent of its approved pool of prospective homeowners. “More seniors are learning about the Habitat program and are able to live comfortably in their own homes as they age,” she says.

Dixon is a caregiver for her brother, who is bedridden. Both have diabetes, heart problems and other health challenges, but they will be able to live independently in their new home with the help of aides.

“I’m just trying to do what I can to keep him with me,” she says.

Focus on financial help

Federal officials consider a household “cost burdened” when occupants spend more than 30 percent of their income on rent, mortgage and other housing expenses.

More than 618,000 Hoosier households — or about 24 percent — exceed that threshold, according to the Indiana Housing & Community Development Authority. Renters are the worst off, with 42 percent spending more than 30 percent. That’s compared with 16 percent of owners.

Extremely low-income rental households — defined as either those living in poverty or those making below 30 percent of an area’s median income — have the fewest affordable options, according to a 2023 report from the National Low Income Housing Coalition and an Indiana community development group. Hoosiers age 62 and up comprise 26 percent of this group.

AARP Indiana advocated for passage of a law that will provide communities with low-interest loans for water, sewer and other infrastructure projects, which could help attract housing development. Lawmakers included $75 million in the state’s biennial budget for these loans, with 70 percent earmarked for communities with populations of 50,000 or less.

In Evansville, AARP is also supporting changes to the city’s affordable housing trust fund to increase housing options for those with lower incomes. The fund provides financial housing assistance to individuals and families who meet certain income qualifications, which AARP hopes the city will expand.

 Learn more about AARP Indiana’s work on affordable housing at aarp.org/in.

Sarah Hollander is a writer living in Cleveland.

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