Characteristics of Housing in Mississippi

Before approaching development, it is important to understand the state of housing in Mississippi and the key data points that are used when assessing and describing housing needs.

Homeownership Rate and Units in Structure

The nature of Mississippi’s housing stock – similar to other rural states – is predominantly homeownership and single-family. The state has the sixth-highest homeownership rate in the country, at 74 percent. A similar percentage of the state’s homes, 70 percent, are single-family homes. The lack of large urban centers in Mississippi results in higher homeownership rates and fewer multifamily homes than states with large cities.

Single-family and “small rental” homes are a majority of the rental housing stock as well, with 1-4 unit properties accounting for 60 percent of rental homes in Mississippi. When the number of units is expanded to nine or fewer units, the small rental category includes nearly three-quarters, 72 percent, of all the rental homes in the state.

Housing Cost Burdens

Housing unaffordability is a persistent problem for states across the nation, with Mississippi being no exception. Finding an affordable place to live is more and more out of reach, especially for low- and moderate-income households.

We find that housing costs are tied to income around the country – for instance, cities and states with high median incomes also have high median rents or home sale prices – and relatively low or high housing costs do not tell the whole story of housing affordability. That is why housing cost burden, which calculates housing costs as a percentage of household income, is most commonly used to denote affordability rather than median rents or home sale prices (see the Getting Started section for more information on affordability definitions).

While Mississippi has low housing costs relative to other states, its low median income means that many households are still facing unaffordable cost burdens:

Vacancy Rates

Vacancy rates measure the number of housing units unoccupied at a certain period of time, and are a key indicator of the demand and market health. For Mississippi, recent declines in the rental vacancy rate indicates improved rental demand, though Mississippi's rate remains higher than the national average: 7.8% compared to 5.1% nationally in 2022. This suggests an oversupply of rental units, which may help stabilize rent increases. However, as noted above, many households in Mississippi are still rent-burdened. Additionally, in 2022, the homeowner vacancy rate sat at 0.6% and 0.8% nationally, pointing to limited movement in the housing market for buyers.

Homelessness Rates

In 2017, Mississippi faced a homelessness rate at 0.05%, with 1,472 individuals. It dropped to 0.04% (1,184 individuals) in 2019 and further to 0.02% (626 individuals) by 2021, possibly due to temporary housing during the 2020 pandemic. However, in 2022, the rate rose again to 0.04% (1,196 individuals), indicating a return to previous trends. In contrast, nationally, the homelessness rate sat at 0.17%, with 582,462 individuals. This data comes from HUD’s annual Point in Time count.

Energy Burden

The design and systems decisions made when constructing a house have a huge impact on energy use and costs for residents. The percentage of a household's income spent on energy is referred to as their energy burden. In Mississippi, households with low incomes have the highest energy burden of all states, spending on average 12% of their income on energy costs. Additionally, the state ranks as one of the highest in the amount of energy used in homes and number of households unable to pay their energy bills. Planning for energy efficiency and energy retrofits can reduce both energy consumption and energy costs. This is critical in tackling overall housing affordability.

Community Education and Engagement

Engaging the community is a critical part of the housing development process, particularly during the visioning and predevelopment phases. Meaningful community input fosters responsible development and strengthens neighborhood support. By opening discussions with residents, you may uncover new insights and unexpected concerns that shape the project for the better.

Keeping the community informed at every stage is essential, starting with education on the benefits of development. Since development is an iterative process, ongoing communication about significant changes, funding updates, delays, or milestones helps maintain transparency and build trust.

Providing continuous opportunities for public input fosters long-term support, minimizes confusion, and ensures that the project remains transparent and responsive to community needs.

Housing Needs Assessment

Your team may have first-hand knowledge about your communities’ needs, but it is important to gather big-picture information. A needs assessment can help steer the overall direction of the project and save valuable time and resources over the lifetime of the project.

If your town or city has conducted a Housing Needs Assessment in recent years, seek it out. Also, Local Housing Solutions offers a Housing Needs Assessment tool, which provides detailed reports for every city, county, and metropolitan statistical area in the country.

A needs assessment may help you understand the number of units that are needed for development and the bedroom size of those units. Needs assessments should address needs related to rental and homeownership projects. It can also help narrow down location preferences, building typology and amenities needed in the community.

Housing needs assessments document the unmet housing needs in a market. This is typically accomplished by comparing the overall housing needs to the current supply of housing to determine what portion of the needs are unmet. In the absence of a dedicated housing needs assessment, there may be other local plans and studies that document unmet housing needs in the neighborhood, community, or region. Because housing needs are typically large and diverse, housing needs assessments can be undertaken while simultaneously working on a development project.

Disaster Recovery

Mississippi is particularly vulnerable to natural disasters, including hurricanes, floods, tornadoes, and severe storms. These events can cause widespread damage to homes and displace large numbers of residents, creating an urgent need for homeowner and rental repair and reconstruction programs. In the wake of a disaster, developers have an opportunity to contribute to housing recovery efforts while also advancing affordable housing initiatives. However, disaster recovery housing projects require additional considerations beyond those of a typical affordable housing development.

While the visioning and planning process for a disaster recovery housing project will be similar to that of a traditional affordable housing development, developers must account for several additional factors to align their projects with state and local recovery efforts. One of the most important elements is formal community engagement and planning processes. After a disaster, cities and counties often conduct structured recovery planning efforts that include a broad range of stakeholders. These planning processes may be led by state or local emergency recovery agencies, housing offices, or nonprofit organizations. As a developer, it is essential to participate in these discussions, as they can provide valuable insights into community needs, funding opportunities, and local policy priorities.

Another key factor is access to disaster-related housing data. Following a major disaster, multiple agencies collect and publish data on housing damage and displacement. HUD, FEMA, and state and local emergency management agencies provide assessments that document the extent of housing loss and identify priority areas for redevelopment. These data sources can be crucial for understanding the scale of the need, identifying viable sites for redevelopment, and determining eligibility for recovery-related funding.

If the state or local government receives federal disaster recovery funding, affordable housing developers should pay close attention to how those funds will be allocated. One of the primary sources of federal assistance for long-term housing recovery is Community Development Block Grants – Disaster Recovery (CDBG-DR). When states receive CDBG-DR funding, they must develop an Action Plan, a formal document that outlines how the funds will be distributed. This process includes public engagement and stakeholder input, making it essential for developers to stay informed and participate in shaping recovery priorities. By aligning projects with the state’s action plan, developers can position themselves to access critical funding resources and contribute to the long-term rebuilding efforts.

Overall, developing affordable housing in disaster-affected areas requires careful planning, collaboration with government agencies and community groups, and a strong understanding of available funding and data sources. By integrating these additional considerations into their approach, developers can help address the urgent need for safe, affordable, and resilient housing in communities recovering from natural disasters.

Evaluating Housing Development Models

Once you have gone through the visioning phase and understand local housing needs, your organization’s capacity and priorities for the development, you will now need to consider what type (or model) of housing your organization should develop.

Some key decisions to make when defining your development model include tenure, existing site use, building use, and structure type.

Tenure

Will your development be rented to tenants or sold to homebuyers?

Lease-to-own: Lease-to-own housing, also known as lease purchase or rent-to-own housing, is a type of agreement where tenants rent a home with the goal of buying it after a period of time. Housing providers can pair a lease-to-own arrangement with homebuyer counseling to help build the tenant’s credit and understanding the homebuying and mortgage process. A portion of the monthly rent may be credited toward the future down payment or purchase price, allowing tenants to build equity while living in the home.

Co-housing: Co-housing is a type of intentional community where residents live in private homes but share common spaces—such as kitchens, gardens, or recreation areas—and actively participate in managing the community. While each household maintains its own self-contained unit, co-housing emphasizes collaboration, mutual support, and social connection.

Existing Site Use

New construction, the acquisition and development of undeveloped land, provides a lot of flexibility related to use and design, but it also can have higher costs or require additional zoning or infrastructure investment.

Redevelopment is new construction that occurs on a site that has an existing building or other designated use. In the case of redevelopment, demolition is often required and that must be built into the budget. You should also be mindful of existing infrastructure and its placement.

Rehabilitation (also known as rehab or preservation) focuses on improving an existing housing development to create or maintain affordable housing. This eliminates the cost to develop the building from the ground up as infrastructure is already in place and the entitlement process is already complete. While preservation is often less expensive than building new, rehabilitation of existing buildings can still be costly, particularly if abatement is needed, or if the structure needs significant improvements to be brought up to current codes. If you are interested in rehabilitation, thoroughly investigate the characteristics and needs of a potential site so that you can adequately build them in your development budget. If there are residents living in the building, you will also need a relocation plan. Rehabilitation can also refer to homeowner repair programs that help people repair the homes they already own.

Adaptative reuse is similar to rehabilitation in that a developer is modifying an existing building but, in this case, the building’s use is adapted from one to another. For example, a hotel or office building could be converted into affordable housing. As is true for rehab, you should do additional due diligence to best predict costs associated with adapting the structure and pay attention to costly items, such as abatement. Adaptive reuse can be an important historical preservation approach to enable buildings that are not serving their historical function to remain useful to the community.

Structure Type

Single family structures are homes designed for only a single family or household to occupy the building. Many single family homes are developed to be sold, but they are also an important source of rental housing in many communities, particularly rural ones. Single family structures can be attached to other adjacent buildings (townhomes) or detached. They can be developed individually or together with other housing as part of a multi-building development.

Multifamily structures have multiple housing units within the same building and on the same lot. Multifamily units can be renter-occupied (apartments) or owner-occupied (condominiums) and can range from small (two- to four-unit buildings) to large (50 or more units). Multifamily buildings create more housing units on a single site and typically result in greater density compared to single family construction. Multifamily buildings larger than four units will likely require different types of financing than single family and one- to four-unit multifamily buildings.

It is important to note that multifamily projects that take advantage of the scale often needed to bring in financing sources like LIHTC are not limited to large box buildings. Multifamily projects could be designed as single story or with independent entry, like townhomes, which might speak better to the landscape and surroundings.

Accessory Dwelling Units (ADUs) are a form of housing in which a smaller, independent residential unit is developed on the same lot as an existing single-family home. ADUs can be both a form of affordable housing for the person renting the ADU and a source of secondary income for the owner of the lot. ADUs may be relatively inexpensive to develop if the existing home is already well-suited for the purpose, or they may be costly additions that involve substantial new construction and rehabilitation activities. Financing, zoning, building codes, utility access and parking requirements are considerations when adding ADUs on existing lots.

Building Use

Single-use residential buildings are devoted solely to housing. A single family home or an apartment building are examples. These are the most straightforward approaches for developing affordable housing. There are fewer actors and public service provisions required. The feasibility assessment and financing will likely be more straightforward than if the building has other uses, as those uses will also generally need some assessment of feasibility to secure funding.

Mixed-use buildings or developments combine housing and other uses within the same building or site. A common example is a residential building with retail or other commercial spaces on the ground floor so that businesses are accessible from the street. Mixed-use developments involve a range of factors that go beyond the scope of this guide relating to commercial real estate development.

A few questions to ask as you evaluate which model to adopt:

• How does this housing type relate to the housing needs in our community?

• Will this housing model advance our organizational goals?

• What financial implications might this housing model have for our organization?

• Can we build this type of housing to be affordable for the residents who will live here?

• What additional zoning and regulatory burdens might this model require?

• Will this type of housing be valued by the broader community, or will some be more likely to face opposition or lack of support?

• Do we have experience with any of these housing models that we could build on?

Site selection also plays in to the housing development model. See Phase 3: Site Selection and Design for more information about project site selection and approvals.

Design Considerations

Concept Development

A design concept provides the overarching vision for a development, guiding decisions throughout the predevelopment and construction phases. It ensures that the core goals and challenges the project aims to address remain central. However, it’s important to stay flexible—designs will likely evolve as development progresses, and changes should align with the initial vision while accommodating new insights.

Defining Your Target Population

Your organization may have already identified the populations it aims to serve, but if not, this should be a key consideration in the visioning and concept development stages. Potential target groups could include:

• Households earning a specific income level (See AMI definition)
• Older adults
• People with disabilities

Design Concept & Community Engagement

Community members should play an active role in shaping the design of a housing project. Whether working with architects, developers, or funders, incorporating local input can lead to creative, community-driven solutions.

Early engagement can also help identify historical, cultural, or neighborhood-specific elements that should influence the design. Community stakeholders may also provide insights into optimal site locations and potential development impacts.

Ways to Engage the Community in Design

• Workshops & charrettes – Collaborative design sessions where stakeholders provide input
• Online design tools & surveys – Digital engagement methods for wider participation
• Interviews & focus groups – Direct discussions with community leaders and residents

Designing for Supportive Housing & Services

If the development includes supportive services, space planning is critical. Consider:

• Private counseling rooms for mental health or case management
• Larger group spaces for community activities
• Secure storage areas for medical or service-related equipment
• Child-friendly spaces if family reunification services are involved

Thoughtful design ensures that the built environment enhances—not hinders—the ability to provide supportive services.