Cheap housing that raises the bar
Daryl J. Carter, MArch ’81, SM ’81 grew up in the predominantly Black neighborhood of Core City in western Detroit during the ’60s and’ 70s, when redlining practices reinforced segregated housing than usually still. The Federal Housing Authority and private banks have denied low-interest loans to buyers in such neighborhoods, exacerbating economic hardship for generations. Some blacks still bought houses, but most were forced to rent.
Despite a popular belief that Black communities are not very strong, Carter sees the strengths of Core City. She noticed that everyone in the neighborhood had a role: to look after the neighbors ’children, or to help the elderly maintain their independence. Those observations inspired him as chairman and CEO of Avanath Capital Management, where he and his colleagues focus on transforming the affordable-housing sector. Currently, Avanath owns more than 80 properties in 13 states. Most of its 12,000 apartments are targeted at tenants who earn 40% to 80% of the median income in the area, most of whom qualify for Section 8.
The Section 8 Housing Choice Voucher is the federal government’s largest program for helping low -income families, the elderly, and those with disabilities purchase decent, safe, and sanitary housing on the private market. Vouchers cover up to 70% of the rent. “There’s a myth that Section 8 housing is a risky investment,” Carter said. “The data doesn’t support this.”
Carter said Avanath’s focus on providing services and entertainment not typical of affordable housing has contributed to its mission and continued financial success. For example, the company has built a free app that residents can use to report maintenance issues. “That way we can respond quickly,” he said. “In doing so, we not only protect our investment, but we build trust and community among our residents.”
“Our strategy is to look beyond the building area to the entire footprint of the community,” Carter continued. “We want our residents to have access to public transportation, a grocery store, and health care. Some of our properties include an outpatient clinic on the first floor. Once covid vaccines are available, residents just have to take the elevator to get their shot.
Carter says MIT helped him on his way — and “not just because of the knowledge I gained in finance and architecture. I have classmates who encourage me to dream bigger, and MIT is investing in me in a fellowship, ”he said. “I’m happy to be able to pay for that by investing in housing for the underserved and creating a better world.”