In 2024, Cleveland experienced one of the highest annual rent increases among the nation’s 50 most populated metro areas. According to a report from tech real estate company Zillow, rental costs in Cleveland rose 7.3% between July 2023 and July 2024.

With budget-friendly housing out of reach for many residents, Cleveland is implementing a program to finance refurbished homes and apartments city-wide. Announced March 18, the Cleveland Housing Investment Fund (CHIF) will create between 2,500 and 3,000 affordable housing units, a tally also encompassing a minimum of 100 new for-sale homes.

As Cleveland continues tear-downs of abandoned properties—a problem that still plagues many East Side neighborhoods – revamping existing homes and apartments is a positive move forward, says Cleveland City Council President Blaine Griffin.

“We wanted to focus on doing a couple of things at once,” says Griffin. “It’s about helping developers renovate and build good, quality affordable units. We also want to help emerging entrepreneurs and investors who can invest in areas where, quite frankly, the market refuses to go.”

The hope is CHIF will help build and renovate affordable housing.CHIF, a collaboration between city officials and community development group the Local Initiatives Support Corporation (LISC Cleveland), was created with help from a $18 million City of Cleveland grant, along with a $20 million investment from KeyBank.

Long term, the initiative aims to raise $100 million for new home construction along with preservation of mixed-income rental housing. Cleveland neighborhoods, such as Collinwood and Buckeye, will see the brunt of development, although projects outside these communities will also be considered, say project officials.

“By creating the Cleveland Housing Investment Fund, we are not just addressing a pressing need; we are investing in the future of our neighborhoods,” said Mayor Justin Bibb in a March press release. “We are grateful for the support from KeyBank and excited to partner with LISC, which has a great track record in the creation of innovative programs that lead to successful affordable housing projects.”

Kandis Williams, executive director of LISC Cleveland, says CHIF is designed to ensure that area development opportunities are not limited by economic constraints. In practice, this could mean implementation of below-market pricing or other terms that help make a deal work.

“We’re not bound by one-size-fits-all criteria—instead, we structure financing to meet the unique needs of a project or developer,” Williams says. “We also welcome projects led by emerging developers and projects that align with our mission-driven goals.”

A ‘tool in the toolbox’

Ideally, CHIF will meet affordable housing demand among low-income, working-class, and middle-class residents. In Cleveland, which has the second-highest overall poverty rate among large U.S. cities, housing inequity has long been tied to housing quality, safety, justice, and stability, adds Griffin.

The hope is CHIF will help build and renovate affordable housing.Historically, Cleveland and many urban areas produced red-inked maps to foster racial segregation and discrimination in housing. This process of “redlining” was encouraged by the federal government—which helped spread the practice to local lending institutions that, in turn, deemed many Black neighborhoods too “hazardous” for investment.

Cleveland developed fair housing policies in the 1960s and 1970s—the Fair Housing Council was launched in 1964 as another bulwark against discriminatory practices. Griffin says he sees CHIF as a means of dismantling Cleveland's “islands of poverty,” and says expects diverse housing options tailored to each neighborhood.

“I’m a proponent of ranch housing, or other [housing] where people can age in place,” Griffin says. “Seniors have to abandon their homes because they can’t walk up and down the stairs. So, let’s look at all different kinds of housing.”

Access to housing stock remains a challenge for a city with so many uninhabitable structures—although the CHIF program is not a cure-all, it can be a valuable component to address affordability, says Tania Menesse, CEO of Cleveland Neighborhood Progress.

“It’s another tool in the toolbox,” says Menesse, whose group provides financial support and technical assistance to area Community Development Corporations. “[CHIF] is ideally suited for many of the apartment buildings of 18 to 20 units you see scattered about. But we need workforce housing, too.”

Waterloo in ColinwoodMenesse advocates for expanding the project to renovate more single-family homes. Without substantial subsidies, low-cost renovation of such dwellings is mostly unfeasible. For now, she says there is significant value in renovating apartments and multi-family homes to be both livable and affordable.

“We absolutely must have a tool for developers to provide quality rehabilitations of apartments throughout Cleveland,” Menesse argues. “CHIF is a fantastic tool for that. These are mid-block anchors that cannot become eye sores.”

Williams of LISC Cleveland says that all deals financed by CHIF will include affordability covenants—deed restrictions that limit resale prices or tie rents to certain income thresholds. Additionally, each covenant will be in place for a minimum of 15 years.

Ultimately, bolstering Cleveland’s population through programs like CHIF can alleviate the city’s persistent affordable housing challenges, says Council President Griffin, who adds that new homes should also be a source of pride for their occupants.

“Most of all, these homes have to meet sensory tastes,” Griffin says. “People want to touch and feel success; they don’t just want to see a bunch of numbers saying that this will be successful.”