What Does 60% AMI Mean for Housing?
Understand 60% Area Median Income (AMI) and its impact on housing affordability, access, and program eligibility.
Area Median Income (AMI) serves as a fundamental benchmark in discussions surrounding housing affordability. It provides a standardized measure to gauge income levels within a specific geographic area, offering a common reference point for various housing programs. Understanding “60% AMI” is important for individuals seeking affordable housing, as this percentage directly relates to eligibility for assistance programs. This metric helps define who qualifies for housing support, ensuring resources are directed to those for whom market-rate housing may be financially out of reach.
Understanding Area Median Income (AMI)
Area Median Income (AMI) represents the midpoint of a region’s household income distribution. This means that half of the households in a given area earn more than the AMI, and the other half earn less. The U.S. Department of Housing and Urban Development (HUD) calculates and publishes these figures annually.
AMI figures are not uniform across the country; they vary significantly based on geographic location, such as metropolitan areas, counties, or non-metropolitan regions. HUD updates these calculations each fiscal year, reflecting changes in local economic conditions and income trends. AMI is adjusted to account for household size, recognizing that larger households require more income. For example, the AMI for a single-person household will be lower than that for a family of four in the same area.
The Significance of 60% AMI
The term “60% AMI” signifies an income level that is 60% of the Area Median Income for a particular location and household size. This percentage is a common threshold for eligibility in various affordable housing initiatives. Many housing programs, including those funded by the Low-Income Housing Tax Credit (LIHTC) program, often use 60% AMI as an income limit for prospective residents.
This threshold is also frequently applied to rental assistance programs and certain homeownership opportunities for moderate-income households. While other AMI percentages, such as 30% for extremely low-income or 80% for low-income, exist for different tiers of affordability, 60% AMI serves as a benchmark for a substantial segment of affordable housing. Meeting this income criterion is a prerequisite for accessing housing units or subsidies designated to be affordable for households within this income bracket.
How Income is Assessed Against AMI
A household’s income is assessed against established AMI figures to determine eligibility for affordable housing programs. “Household income” refers to the gross income of all adult members, calculated before taxes and other deductions. This includes various income sources.
Income sources counted include:
Wages, salaries, and self-employment earnings
Social Security benefits
Pension payments
Unemployment benefits
Rental income from other properties
The number of individuals in a household directly influences the specific AMI threshold. For example, a 60% AMI limit for a single person will differ from that for a family of four. Programs require documentation to verify reported income and confirm eligibility, such as:
Recent pay stubs
Federal tax returns
W2s
1099s
Finding Your Local AMI
To determine your local Area Median Income, the U.S. Department of Housing and Urban Development (HUD) website is the most reliable source. Navigate to the HUD User portal to find the “Income Limits” dataset.
You will be prompted to select your state and then your county or metropolitan area. Select the correct fiscal year, as AMI figures are adjusted annually. Once you locate the data table, you will see AMI values adjusted for different household sizes. To find your 60% AMI limit, multiply the AMI for your household size by 0.60. This calculation provides the maximum income allowable for your household to qualify for programs at the 60% AMI level.