Town receives $1.5 million award for Tanyard Branch Trace affordable housing project

On March 27, Tanyard Branch Trace, an affordable housing development on Jay Street, received a $1.5 million award from the federal government. 

The development is projected to cost $8.9 million and will be supported by the recent award along with a low-income housing tax credit award the project received in 2023.The low-income housing tax credit award, given by the North Carolina Housing Finance Agency, will bring more than $10 million to the project, said Sarah Viñas, the director of affordable housing and community connections for the Town of Chapel Hill.

She also said thatin order to acquire the $1.5 million award from the federal government, the Town submitted a request through Rep. Valerie Foushee (D-N.C. 4th), which went through a long vetting process before it was finally approved.

The project will include 48 housing units, ranging from 1-3 bedrooms and will be available to households that earn at or below 80 percent of the area median income (AMI). While a majority of these units will serve residents that earn at or below 60 percent of the AMI, 12 of the 48 units will be reserved specifically for households that earn 30 percent AMI.

According to the project’s website, the development will be close to public transit and numerous employment opportunities — two factors that will be critical to the community's long-term success.

The Town partnered with Community Home Trust and Taft-Mills Group in 2021 to manage the project. Both groups have been longtime partners with the Town in management of affordable housing, with Community Home Trust buying and selling more than 330 permanently affordable homes in Orange County as of 2021.

Viñas said the project has been in the works for several years — the town council prioritized Town-owned land on Jay Street for affordable housing in June 2018.

Theodore Nollert, a town council member, said the development is being built on Town-owned land to decrease the overall cost of the project, since the Town does not have to purchase the lot.

Viñas said the Town is happy to see the project moving forward in the midst of the housing crisis.

"We are really excited to have this project come alive, because we know that we have a national and local affordable crisis," she said. "This project helps chip away at the need for affordable housing in the community."

According to Chapel Hill Affordable Housing’s most recent quarterly report, the Town has seen a steady rise in home values and rental rates since 2019 — with a 24 percent increase in rental rates and a 51 percent increase in home value.

“I think a lot of the existing affordable housing is falling into disrepair and it's hard to maintain it,” Blake Rosser, interim director at Orange County Housing Department, said. “Rental prices have increased a lot over the last several years. They seem to be increasing faster.” 

The median household income in Chapel Hill is $116,200, according to the quarterly report. This means that a household making the median income and spending 30 percent of their income on housing would spend more than $34,000 per year on housing.

The Town's data shows 60 percent of renters are "cost-burdened," meaning they spend more than 30 percent of their income on housing.

"It helps — it provides housing that's below the naturally occurring floor for what people can buy or rent, generally speaking, so this fits into that subsidized bucket and it's an important contribution to a high area of need for the town," Nollert said.

Construction on the development is set to begin this summer and opening is planned for winter 2026.

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