Iyaire Lilly is only 23, yet he wonders if he will ever be able to buy a home or rent a spacious apartment with nice amenities.
His concerns are supported by daunting statistics. In a market where there are more people looking for housing than there are units available, both home prices and rents continue to rise. The result is a shortage of 50,000 homes, according to the Delaware State Housing Authority (DSHA). That includes 19,000 affordable housing units.
Lilly currently rents a studio apartment for $1,000 a month in Wilmington’s vibrant Trolley Square, compared to the city’s average rent of $1,594. It’s small, less than 500 square feet, but he enjoys the prime location.
“I feel very lucky to have found this place,” he says.
To help people who are still looking for homes they can afford, DSHA spearheaded the creation of a statewide resource that brings together all five of Delaware’s public housing agencies. Consumers can apply online and information can be readily accessed by phone. Waiting lists no longer open and close, leaving would-be renters wondering when they will get a chance to join the queue.
“It’s the first statewide waiting list of this caliber anywhere in the country,” says Matthew Heckles, DSHA director.
The response to the new system was immediate. Currently, there are 20,357 residents on the waiting list.
“It’s shows us just how far we have to go,” Heckles says.
“It all goes back to supply. If you look back on the past 40 years of building housing, there just hasn’t been enough that’s affordable. We have new housing, but at a higher price point.”Matthew Heckles, Delaware State Housing Authority director
The housing crisis is confounding and complex, with roots going back to 2008, when the real estate bubble burst in a cascade of escalating prices and bad mortgage debt.
“A lot of builders stopped putting up houses,” he says.
Added to the mix are zoning requirements that mandate large lots for single-family homes, which makes it difficult to get approval for multi-family units.
As Heckles and other affordable housing advocates see it, the solution is high-density building.
“It all goes back to supply,” he says. “If you look back on the past 40 years of building housing, there just hasn’t been enough that’s affordable. We have new housing, but at a higher price point.”
Still, there are cities where housing shortages have been eliminated. Heckles points to Austin, Texas, where home prices rose 69% in two years as a crush of workers flooded in to burgeoning tech companies.
“They built and they built and they built until they caught up with demand,” he says. “Building takes time but it is our pathway out of this crisis.”
As inventory grew, Austin’s housing market became less competitive. Rents stabilized. But there’s been pain for home sellers as prices dropped.
Rent stabilization was the topic of recent debate in Wilmington, where a group of citizens lobbied vociferously for a measure introduced in city council that would have limited the amount landlords could raise rents. The proposal was opposed by Mayor John Carney and Gov. Matt Meyer, who said rent caps would have a withering effect on development. The measure was narrowly defeated.
In Laurel, where the median household income is $44,593 a year, ground has been broken on a development aimed at making buying a home more attainable. The Promenade will offer 28 homes, priced at about $290,000, thanks to grants and rebates from Delaware’s Downtown Development District program. The median home price in Laurel is $359,900, up from $359,900 in 2024, according to realtor.com.
Construction was delayed when extensive damage to Laurel’s antiquated sewer system was discovered during site work. Homes are expected to be on the market in about nine months, says Brian Shannon, executive director of Laurel Redevelopment Corporation.
Currently, the poverty rate in this historic Sussex County community is 35.7%. There are no income restrictions on buyers at The Promenade, but the new owners must promise to live in the homes, which will have three bedrooms and 2.5 baths.
“They will be reminiscent of the worker homes that you can find all over Laurel,” Shannon says.
In a small town like Laurel, population 4,043, even a 28-home community can make a difference in economic development, he says. The home ownership rate is about 50%, compared to the state rate of 76%.
Shannon says the shift of owner-occupied houses to rental homes evolved over years as residents moved and sold their houses. Often, investors bought them and turned them into rental properties.
Laurel has implemented measures to reverse that trend. Single-family homes no longer can be divided into duplexes, which makes the properties less attractive to landlords.
Communities, developers and individuals are getting creative as to how they can put more roofs over more heads. Senate Bill 87 would require local governments to allow the construction of accessory dwelling units (ADUs), commonly known as granny flats. The ADUs could be constructed either as additions to existing homes, over garages or as separate cottages, which could then be rented.
Lilly, the renter in Trolley Square, is contemplating buying an RV and living in it full time, a growing trend in California, Oregon and Colorado, which also are experiencing a paucity of affordable housing.
“I’ve gotten used to living with not much space, and an RV costs a lot less than a house,” he says.
Lilly isn’t the only one thinking small. Little Living, a nonprofit developer, is building a village of 10-20 one-bedroom and two-bedroom homes in Georgetown, ranging from 400-600 square feet. Two local landowners each donated an acre for the development. Rents would range from $850-$1,000 a month and include utilities and internet service.
Little Living is under contract to develop 27 acres in Kent County for 200-220 homes for sale and 40-50 rental properties. Plans also are in play for a mini-village in Milford, according to founder George Meringolo.
House hunters had a chance to explore their options at DSHA’s Homebuyers Fair on June 21 on the University of Delaware campus in Newark, the first such event in five years. Heckles said the fair drew a variety of attendees, from prospective buyers who wanted to learn about lending options and help with down payments to parents looking at incentives for first-time buyers so they “can get their kids out of their basement.”
“Landlords can be real picky. They have a lot of people who are interested in renting their properties,”Matthew Heckles, Delaware State Housing Authority director
Heckles says renters are especially hard-pressed. He spoke with a nurse in Dover who became homeless when she couldn’t afford a $200-a-month increase in her rent. A report on America’s Rental Housing by the Joint Center for Housing Studies of Harvard University says unaffordable rents are at an all-time high, with half of renters spending 30% or more of their income on rent and utilities, and more than a quarter of renters spending 50% or more.
Even renters with good incomes face challenges if they have imperfect credit or have been evicted in the past.
“Landlords can be real picky. They have a lot of people who are interested in renting their properties,” he says.
Still, there is progress in the affordable rental market, although units can be hard to come by. The Flats, developed by Woodlawn Trustees, will soon begin construction on 52 apartments on Wilmington’s West Side. The first three phases, with a total of 232 units, are complete. The waiting list is closed.
The redevelopment of George Read Village in Newark will bring 72 units, including 18 new units, to the city’s Main Street. The project replaces the existing structure with a mid-rise, mixed-use building, plus five new cottages that will house families. Apartments will be available to households with incomes between 30% and 50% of the Area Median Income. The AMI for New Castle County currently is $114,700.
In Lewes, the Chapel Branch development will bring 42 affordable and market-rate units, thanks, in part to a $1 million federal grant. Chapel Branch will include a community center and is the first affordable housing project in Lewes to receive government funding since 2003.
Two affordable developments are being revitalized in a $29-million project in Dover. Owens Manor is a 60-unit senior housing facility. Queen Manor is a public housing project with 50 apartments.
In the redevelopment of Wilmington’s Riverside community, affordable apartments are part of a new model that combines housing with a library, childcare center, a charter school and support services through Kingsway Community Center. Imani Village IV will include 84 new units, 57 affordable and 27 market-rate.
“It’s a complete transformation, a national model,” Heckles says. “It’s not enough to just build affordable housing. We need to connect housing with services and opportunities.”
