Some 74% of households would not be able to afford Louisville’s median home sales price of $896,000 if they were to buy a home today, according to a new Louisville housing plan.

A Louisville family would need to earn around $209,000 in 2023 to afford the $896,000 median home price in Louisville in 2023, but just a quarter of families earn more than $200,000 annually, the new housing plan found.

The Louisville City Council approved the housing plan on Tuesday. City officials worked with EcoNorthwest, a public policy firm in Portland, Oregon, on the plan after receiving a $60,000 grant from the Department of Local Affairs in 2021.

The plan is meant to serve as a guiding document to address housing availability and affordability in the city, officials said Tuesday. The plan focuses on the city’s goal of having 12% of the city’s housing stock be “permanently affordable” as well as on future housing needs. Housing is considered “affordable” if a family’s cumulative housing costs account for less than 30% of its gross income.

“(The plan) is just how we address housing affordability going forward,” said Jeff Hirt, Louisville planning manager.

Hirt said the new housing plan focuses on three priorities: increasing residential development opportunities, expanding access to affordable housing and diversifying the city’s housing stock. Other suggestions in the plan include changing zoning in areas around Louisville to support more residential development, possibly allowing accessory dwelling units to attached and detached buildings on single-family lots and development fee reductions for income-restricted projects.

The housing plan also focuses on adding more homes for older residents, since workers found that the median age in Louisville is 43. The housing plan also sets the goal to create more housing opportunities for empty-nesters, young families, first-time homebuyers, disabled individuals and renters.

Louisville residents at Tuesday’s meeting said they wanted to make sure that if city officials lift some building restrictions for developers that any new incentives actually would benefit affordable housing developments. Residents also wanted to make sure that the plan does not create economic segregation where people of different incomes live and work in different parts of Louisville.

Tamar Krantz, a resident, said that the city needs to be selective of what developments are built. She was one who said that any zoning or policy changes benefit affordable housing developments. She also suggested that the city increase the fee-in-lieu price or developers who choose to not build affordable housing, since she said developers often choose to pay the fee rather than build the affordable units.“There’s only so much we can grow, and we only have the chance to do it once,” Krantz said.

Annmarie Jensen, East County Housing Opportunity Coalition founder and executive director, said that the current cost of housing in the community limits people from living and working in Boulder County, not just Louisville. She said that in Boulder County, one in six people pay 50% or more of their income for housing.

Jensen said that the new Louisville housing plan is a great way to work toward the city’s goal of achieving 12% affordable housing, but that it needs to be strengthened with more timelines.

While Louisville received the grant in 2021 to pay for the housing plan, staffers put off working on it until mid-2023 to focus on Marshall Fire recovery. In addition, the grant required a 25% local match to fund the project, and the Louisville City Council paid $20,000 to EcoNorthwest.