Florida TaxWatch is calling on state lawmakers to establish a state-level housing tax credit to increase access to affordable housing crisis, citing similar initiatives in other states that have successfully expanded housing availability and stimulated economic growth.

In a report released Wednesday, the nonprofit government watchdog outlined the scope of the problem, noting that Florida has only 25 affordable and available housing units for every 100 extremely low-income renter households. The state ranks the lowest in the Southeast and, among the 10 most populous states, trails only California in housing scarcity.

Additionally, 2.4 million low-income Florida households spend more than 30% of their income on housing, while 1.3 million allocate more than half of their earnings toward rent or mortgage payments.

“Despite Florida’s recent laudable efforts to provide more housing, the ability to find an affordable place to live is still problematic for many Floridians,” said Florida TaxWatch President and CEO Dominic M. Calabro. “This is a significant deficit of adequate low-income rental options, and the American dream of home ownership has continued to become more elusive for middle-income, hardworking Floridians. Inflation, rising property taxes, and skyrocketing insurance all contribute to making home ownership less affordable.”

The report highlights the economic and social ramifications of the housing deficit, stating that a lack of affordable housing contributes to homelessness, reduces workforce stability and increases public expenditures on healthcare, education and emergency services. The state’s homeless population, estimated at more than 31,000 in 2024, has risen since 2022, and nearly 95,000 K-12 students have experienced homelessness or housing instability, the report states.

The organization recommends implementing a tax credit that would supplement the federal Low-Income Housing Tax Credit, a program that has facilitated the creation of 3.7 million affordable housing units nationwide since its inception in 1986. Thirty states, including Georgia, Texas and New York, have enacted similar state-level credits to increase private investment in workforce and affordable housing.

Florida TaxWatch also pointed to rising home prices and insurance costs as barriers to homeownership, noting that the median home price in Florida has reached $410,000 while the median household income stands at $71,711. The organization highlighted the state’s rapidly growing corporate tax revenues as a means to fund new housing incentives without impacting other budget priorities.

Since 2019, Florida lawmakers have increased funding for affordable housing programs and passed legislation such as the Live Local Act, which expanded tax incentives and workforce housing assistance.

However, Florida TaxWatch contends that additional measures, including new tax credits for homebuilders and adaptive reuse projects, could help further alleviate the state’s housing shortage.

“Florida has made great strides in promoting affordable housing and the Legislature should be commended for their efforts to date, but the shortage of affordable and workforce housing units is still massive,” Florida TaxWatch Executive Vice President and General Counsel Jeff Kottkamp said. “As the Legislature continues to address this challenge, Florida should consider tax credits such as a State Low-Income Housing Tax Credit, a corporate income tax credit for homebuilders to help build more single-family homes that are affordable to middle-income families, and a credit for rehabilitating historic properties for affordable housing.”