For residents of the Laureate, rent is permanently affordable. Their homes are publicly owned and governed with their input.
The Laureate, in Montgomery County, Maryland, is an early example of social housing. Built in 2023, the project represents a new model for affordable housing: one that doesn’t rely on typical, market-based affordable housing programs like tax credits, developer incentives or public vouchers funnelled into the hands of private landlords.
The public can end up on the losing end of deals focused on enticing developers to build more affordable housing. This reality is exemplified by the city’s ongoing struggle with the developers of Block 216, home to the Ritz-Carlton in Portland. In this case, developers for the building opted to pay a $7.8 million fee instead of including affordable units required under Portland’s Inclusionary Housing program. But developer BPM Real Estate Group hasn’t paid. In the end, tax breaks meant to serve the public helped build luxury homes that so few Portlanders could afford, the development is facing foreclosure.
The Laureate is one of two social housing projects Montgomery County has financed and built through the county’s $100 million revolving fund.
Unlike most affordable housing in the U.S., which depends on tax breaks for developers (known as Low-Income Housing Tax Credit or LIHTC), and often eventually becomes unaffordable when it reverts to market rate, social housing is built to last, and built for the people who live in it.
Social housing is permanently affordable, with rent tied to household income. It’s publicly owned or co-owned, often by a city government or housing authority. It’s mixed-income to prevent economic segregation and emphasize equity. And it’s high quality, with leftover funds put back into the housing.
This model will soon be a reality in the Pacific Northwest. Seattle voters overwhelmingly passed a proposition in February to fund the Seattle Social Housing Developer. That made Seattle the first city in the country to commit to building social housing.
Something similar could be in the works for Portland, too: In April, Portland City Council unanimously passed a resolution urging city policymakers and experts to deliver a detailed plan by May 2026, showing how the city could implement social housing. To do so, housing experts will study successful models, both in the U.S. and abroad.
While the plan is still in its infancy, it represents an intentional step away from standard market-based solutions, according to city councilors Candace Avalos and Mitch Green, who co-sponsored the resolution.
“There’s a reason this is catching on in Seattle, in Montgomery County — in cities all over,” Green said. “The tools we have aren’t working anymore. It’s time to build something different.”
Avalos added that the need for such a change is clear.
“Over 50% of Portland households are cost-burdened by rent, and 25% are paying over half their income on housing,” Avalos said. “That’s just not sustainable.”
House of cards
Advocates say a future of truly affordable housing for all will only be possible if cities are willing to take on a more active role, not just in funding affordable housing, but in owning and managing it, too.
Social housing flips the typical story upside down: instead of looking to incentivize private developers to build affordably, the model demands public infrastructure that’s enduring and remains affordable.
As chair of the city council’s Housing and Homelessness Committee, Avalos has watched the gap in affordability grow for Portlanders. She said the private market simply is not designed to meet public needs.
“As a government leader responsible for delivering a public good, I can’t base every decision on what will give me a profit,” Avalos said. “But that is unfortunately how the private market is driven. And most of the housing available to Portlanders is private market.”
In this framework, higher earners would help offset costs for lower earners, while the city finances the production of the housing through a revolving lump fund, creating financial sustainability, inclusion and equity.
“If you make $10,000 a year, you shouldn’t pay more than $3,000 a year in rent,” Green said. “If you make $100,000, you can afford to pay $30,000. The people who make more money subsidize the people who make less money, making it so that you do not have to go to private equity markets.”
Crucially, social housing asks tenants to act as homeowners, with renters able to formally manage their housing.
“Tenant governance isn’t just a feel-good phrase,” according to Rebekah Markillie, a coalition leader at the Oregon Housing Alliance and a master’s student at Portland State University’s School of Urban and Regional Planning. “It means renters have a say in repairs, in budgeting, in what kind of community they want to live in.”
She says that’s part of what makes the model strong. When people have real ownership over their housing conditions, they tend to thrive.
“It’s what gives housing longevity,” she said.
Policymakers are looking to Vienna, Austria as a blueprint for the successful creation and implementation of social housing. Around 60% of the city’s residents live in public or publicly subsidized housing, the majority of which is mixed-income, energy efficient and costs less than 27% of a renter’s income. In part due to Vienna’s social housing practices, few are homeless there — about 0.5% of the overall population as compared to Portland’s 1.6%.
Still, Avalos says that Portland is not simply trying to copy the European model.
“This isn’t just a study to define social housing,” she said. “It’s a study to ask: How can social housing work here, for Portland?”
A group of housing experts will travel to Vienna later this year to create a more in-depth study for Portland’s May 2026 implementation plan.
The U.S. had an opportunity to launch social housing when it sunk heavy investments in public housing in the 1950s, according to Markillie, who is involved in the organization of this leg of the study. Instead, the government shifted toward tax incentives for private developers. That birthed LIHTC, which continues to be the dominant affordable housing tool in the U.S. today.
“We’ve had a couple of opportunities to build a real social housing system in the U.S., and we didn’t take them,” Markillie said.
Markillie said LIHTC is not the right tool for affordable housing, as it requires income segregation, depends on wealthy investors for tax write-offs and offers tenants little control or stability. It also often expires after 30 years and leaves cities vulnerable to land and construction costs.
“I’m kind of surprised this house of cards has stayed upright this long,” Markillie said, referring to LIHTC.
‘A chance to avoid falling into homelessness in the first place’
Green called for Portland to begin acquiring existing apartment buildings and converting them to social housing.
“It’s faster and cheaper than new construction,” Green said, “and it means fewer people fall through the cracks.”
However, funding social housing will not be easy. Money is tight, with multiple city programs already facing cuts amid a $93 million budget shortfall.
The problem is clear — only 741 multifamily units were built in Portland in 2023, a 73% drop from three years prior, and over half of households already spend more than 30% of their income on housing.
To build public housing on a large scale, Portland will need a great deal of funding, which could come in the form of things like municipal bonds, taxes on real estate sales, or dedicated housing levies. Portland might also follow examples like Montgomery County’s revolving loan fund, which uses rent payments to finance new buildings. Other strategies could include buying cheap land or land banking, which means setting aside city-owned property for future housing projects.
While the resolution focuses on long-term affordability, sponsors have another goal: using social housing as a homelessness prevention strategy.
“We’re creating more homeless people faster than we’re housing them,” Green said. “Social housing gives people a chance to avoid falling into homelessness in the first place.”
For experts like Markillie, this is not simply an experiment. It’s a correction to generations of a housing system that doesn’t work.
“We can’t treat this like a five-year emergency,” Markillie said. “It’s a permanent need.”
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This article appears in July 2, 2025.