Nashville Council Weighs Voluntary Incentive Program to Add Attainable Housing

Nashville's Metro Council has begun considering a voluntary program meant to ease the city's housing shortage, taking up the measure on first reading Tuesday night. The proposal arrives as the city confronts a projected deficit of 90,000 homes by 2035.

Called the Voluntary Attainable Housing Incentive Program, the plan would allow developers to seek additional building entitlements. In return, they would designate 10% of their units as attainable for middle-income residents.

Council member Burkley Allen explained how the arrangement would work. A developer who wants to add more units could opt into the program and, in exchange, set aside a tenth of those homes at what she described as an attainable price. Participation would be entirely up to the developer.

Allen said attainable housing refers to units priced at 30% of a middle-income salary. Developers who join could receive incentives that include no cap on the number of units and no minimum parking requirements.

The program grows out of legislation approved by the Tennessee General Assembly in spring 2024, which authorized voluntary zoning for attainable housing across the state.

A City of Nashville study indicates the area will need close to 100,000 homes by the next decade to keep pace with growing demand, while the existing housing supply remains low.

Allen said she hopes the program becomes a useful tool that opens up different housing options for people she described as the core of the city, those doing the work that needs to be done but who cannot find housing they can afford.

She described the measure as only a first step in building the program, adding that more will follow.

If approved, Nashville would join Chattanooga, which so far is the only Tennessee city to have put such a program in place. Chattanooga's council passed its version earlier this year.

The Nashville proposal must clear additional readings before the council can give it final approval.