Housing Matters: City Launches Program to Expand Affordable Housing

The City has a longstanding commitment to supporting the creation and maintenance of affordable housing in Virginia Beach. Every day, families and individuals can afford safe, stable housing through various federal and state assistance programs administered by Housing & Neighborhood Preservation. The City of Virginia Beach also contributes funds toward new development, facilitates partnerships and creates new policies and programs to expand affordable housing opportunities. 

This month the City of Virginia Beach and the City of Virginia Beach Development Authority (VBDA) launched the Attainable Workforce Housing Performance (AWHP) Grant, a new program that aims to promote the private development of safe, quality, affordable multi-family rental housing.  

AWHP Grant At a Glance 

• Provides incentives for rental housing development targeted for households at or below 80% of the Area Median Income.
• Developments must be new construction.  
• Developments may be fully affordable, mixed-income and mixed-use (commercial and residential components). 
• Annual grants are provided to a developer based on a percentage of the incremental real estate taxes generated by their approved development. The incremental real estate tax is the difference between the taxes generated before and after the development is completed.  
• Grants can be awarded for up to 30 years. 

Meeting a Critical Need 

In Virginia Beach, there are currently about: 

• 4,610 affordable multi-family rental units  
• 100 privately-owned affordable townhomes, condominiums or single-family homes scattered throughout the city 

Of these, 1,280 units were created and 413 units were rehabilitated as a result of more than $15 million in federal and local funding the City has invested toward affordable housing since 2000.

Despite ongoing efforts from the City and private housing partners, the 2024 Housing Study found that Virginia Beach faces significant housing affordability challenges. A critical concern is a lack of affordable rental units, especially for residents with very low income. Many of these households are employed in the region's most common occupations and bear the burden of high housing costs to remain in the city. They include home health and personal aides, office clerks, customer service representatives and food and hospitality workers.

The ability to afford housing alone is also difficult for essential workers, such as teachers, police officers and firefighters. In 2024, the median rent for an apartment in Virginia Beach was $1,753 per month, requiring an annual income of $70,120 or a full-time wage of $33.71 per hour, to be considered affordable. 

A Sustainable, Innovative Approach 

High land and construction costs present challenges for affordable housing developers to see a return on their investment. The AWHP Grant program is intended to make affordable housing development more feasible by helping to fill funding gaps. It’s unique because the annual grants are created by the real estate tax revenue generated by the development itself — making the program self-sustaining and performance-based. 

The AWHP Grant program is designed to meet the affordable housing need and boost economic growth. More affordable housing options strengthen our talent pipeline, help employers recruit and retain teams and support vibrant, connected neighborhoods across Virginia Beach. 

The partnership between the City and VBDA on this initiative is made possible by a 2022 General Assembly amendment to the Industrial Development and Revenue Bond Act, which allows local development authorities, in conjunction with their local governing bodies, the power to make grants associated with the construction of affordable housing. The amendment was designed to combat the affordable housing shortage, further economic development and incentivize the development of affordable housing across the Commonwealth. 

In May 2024, City Council approved a recommendation from the 2024 Housing Study directing staff to advance discussions with VBDA to fund new large-scaled mixed-use development projects. Staff studied a successful model in Richmond and worked with VBDA to draft a similar program for Virginia Beach. Earlier this year, Council approved an ordinance and VBDA passed a resolution to officially create the City’s AWHP Grant — becoming the only other locality in Virginia to implement such a program at this time. 

For questions about the AWHP Grant, contact Sharon Shoff, Housing Development manager, at 757-385-5836 or SShoff@VBgov.com.  

• Housing Matters
• Subscribe

City Council approved the development of an education campaign on affordable housing, which was recommended in the 2024 Housing Study report. Housing Matters is the City’s educational and outreach initiative led by Virginia Beach Housing & Neighborhood Preservation that aims to increase residents’ understanding of affordable housing and the need in Virginia Beach.