Yes, it's much harder for low-income households to win the affordable housing lottery

This more broadly confirms what I reported4 @CityLimitsNews in 2017 re #535Carlton @pacificparkbk #AtlanticYards https://t.co/TJTmZGowv3
Far more lower-income people apply4 income-linked #affordablehousing.
So it's misleading 2aggregate number of applicants for a single building

— Norman Oder (@AYReport) June 29, 2020

Affordable Housing Lottery Odds Worst for Those Who Can Afford the Least, The City reported 6/28/20, crunching numbers in a broad way, for the first time on this issue:

A review by THE CITY of more than 18 million applications to the NYC Housing Connect system between January 2014 and March 2019 shows that for every one of the 21,382 new apartments built as part of Mayor Bill de Blasio’s Housing New York plan, 314 eligible applications poured in.
...Of the five income categories within the lottery system, households like Cardona’s that are classified as “extremely low-income” — currently defined as earning up to $30,720 for a family of three — faced the most competition for apartments. For them, 650 applications came in for every available apartment from people who qualified based on household size and income.
...For the apartments with the highest income limits — between $122,880 and $168,960 a year for a family of three in 2020 — the competition was the least, with 123 eligible applicants for every one apartment. They are six times more likely to have their number come up in a lottery as poor applicants — and many ultimately decide not to rent the apartment offered.

That stands to reason. It's surprising, in fact, how many households there were for such upper middle-income apartments. With 535 Carlton, as I reported, there 2,203 households income-eligible for 148 middle-income apartments, a ratio of 15 to 1.

Middle-income challenges

Perhaps middle-income renters are getting more savvy, and more needy. As The City reports:

In 14 projects, most of them targeted to even higher income limits under former Mayor Michael Bloomberg’s housing program, buildings went through their entire list of eligible applicants for the highest-priced apartments and found no one to take their affordable units.... Between 2014 and 2019, 461 units over 14 projects went unfilled, HPD data shows.

That's happened with Atlantic Yards/Pacific Park buildings like 535 Carlton and 38 Sixth Avenue, as well. Fun fact: The City's article contains photos of both buildings (but no mention of my article).

The policy issue

The reason for the imbalance is that higher-income units cross subsidize lower-income ones, and that depends on a robust economy. So the system is stressed by the coronavirus pandemic.

Worse, the mayor has proposed significant cuts to housing funds.

So, though a redesigned lottery system, Housing Connect 2.0, will ensure that only those truly eligible will be accepted, the odds will still be low.

The ideas to fix the system are discussed in brief:

Among the ideas in play are community land trusts, in which a nonprofit organization would take ownership of property for future development, land banking, investing in public housing again and converting hotels into SRO residences.

Another idea: require affordable housing in high-rent districts, so cross-subsidization works. 

But we need a much broader policy response. Ideas suggested in other discussions I've seen include, among other things, reform property tax policy, ensure the suburbs take their share, reduce/remove the mortgage interest deduction, tax financial transactions, and lower construction costs. All these things play a role.