Affordable and Workforce Housing in Delaware

Delaware is a small state with a large and uneven housing gap. The state’s most recent housing needs assessment, published in 2023, found that half of Delaware renters spend more than 30% of their income on housing and that the state needs about 30,231 more homes by 2030. Nearly two-thirds of those homes are needed in a single county, Sussex.

This guide explains who does what in Delaware housing: the state agency, the main programs, how New Castle, Kent and Sussex counties differ, and where a renter, buyer or homeowner can turn. It does not list income limits in dollars. They change every year and vary by county and household size, so check HUD’s income limits lookup for current figures.

What the Numbers Say

Most statewide figures come from the Delaware Housing Needs Assessment, a housing needs assessment prepared for the state by Root Policy Research and released in November 2023. Most of its data describes 2021.

• Cost burden. Half of renters and 20% of owners paid more than 30% of gross income for housing, the usual line for cost burden. About 50,000 renter households were cost burdened. Of those, 25,000 paid more than half their income, which is severe cost burden.
• Rental gap. The state had about 19,400 too few affordable rentals for households at or below 50% of area median income (AMI). This counts missing homes. It is not a count of people who would like cheaper rent.
• Instability. In the assessment’s resident survey, about 8% of Delaware households reported living in a car, couch surfing, or staying temporarily with friends or family. The 2023 point-in-time count identified 1,245 people as unhoused.
• Buying a home. Three-quarters of renters earned less than 120% of AMI, and about 20% of the homes for sale in 2022 were priced within their reach.
• Vacant does not mean available. Of roughly 64,000 vacant homes in 2021, about 38,200 were seasonal or vacation homes. About 6,500 were vacant and for rent.
• Future need. The assessment projects a need for 24,349 homes for year-round residents and 5,882 seasonal homes by 2030.

The assessment concluded that recent building volumes could meet the total. The problem is the mix. A significant share of new homes would need to be priced for households below 100% of AMI and built for permanent residents and the local workforce. In 2021, 85% of the 8,500 homes permitted were single-family detached houses.

A second measure comes from the National Low Income Housing Coalition. Its Out of Reach 2026 report put Delaware’s two-bedroom housing wage at $32.20 an hour. That is the hourly pay a full-time worker needs to rent a modest two-bedroom home at the fair market rent without spending more than 30% of income. The state minimum wage in the same report was $15.00.

Who Runs Housing Programs in Delaware

Housing Delaware (DSHA)

The Delaware State Housing Authority (DSHA) is the state’s cabinet-level housing agency. It was created in 1968. On September 30, 2026, it adopted the public name Housing Delaware. Its legal name and web address did not change.

DSHA fills two roles that many states split:

• It is the state’s housing finance agency. It issues bonds, offers home loans, and awards federal tax credits to developers.
• It is the public housing agency for Kent and Sussex counties, where it runs public housing and vouchers.

The agency also leads the state’s homelessness response, but it does not run emergency shelters. It refers people in crisis to the partners listed under “Where to Get Help” below.

Five housing authorities

Delaware has five housing authorities: DSHA, the Dover Housing Authority, the Newark Housing Authority, the New Castle County Housing Authority and the Wilmington Housing Authority. Each operates on its own. They share one statewide online waiting list, hosted on AffordableHousing.com, so a household can apply to all of them with a single application.

Counties and towns

Zoning and land use are local decisions. Delaware’s three counties and its municipalities decide what can be built where. Each county also runs a community development office that handles home repair programs and local housing programs.

The state can encourage local change but does not write local zoning. Under Senate Joint Resolution 8, Housing Delaware runs a voluntary pilot that gives local governments free technical help to modernize their zoning codes. In February 2026 it named the first participants: eight municipalities and Sussex County.

Key State Programs

Three details are worth knowing.

Homebuyer help comes as a deferred second loan. DSHA reports that it served 1,593 families through its homebuying programs in 2025. Down payment and closing cost help comes as a zero-interest second loan worth 3% to 5% of the first mortgage. No monthly payment is due. The loan is repaid when the home is sold, refinanced, transferred or no longer the owner’s main residence.

DSHA’s rental assistance is time-limited for most households. The agency takes part in a federal demonstration called Moving to Work. Most participants, other than older adults and people with disabilities, receive help for up to seven years while they follow a self-sufficiency plan.

Workforce housing has its own state law. In 2024 Delaware created a grant program for homes serving households up to 100% of AMI. That is above the income ceiling of most federal housing programs, which generally stop at 80% of AMI or lower. In April 2026 DSHA reported $5 million in funding and posted a draft program design for public comment, a step before formal rulemaking. Check with the agency for the current status.

DSHA also passes federal Community Development Block Grant money to local governments in Kent and Sussex counties for home repairs and infrastructure.

How the Three Counties Differ

Delaware’s counties face different problems, and the state’s own data shows it.

Population, assisted homes and projected need are from the 2023 Housing Needs Assessment. Housing wages are from NLIHC’s Out of Reach 2026. NLIHC reports them for three areas rather than by county: the Philadelphia–Camden–Wilmington metro area, which includes New Castle County; the Dover metro area; and non-metropolitan Delaware.

New Castle County

New Castle is the most urban county and holds most of the state’s subsidized housing. Its projected need for new homes is the smallest of the three, but its metro area has the state’s highest housing wage. The assessment recommends aiming new rental assistance for the lowest-income renters at northern New Castle County.

The county runs two inclusionary zoning programs, which set aside homes in participating developments for income-qualified households. Its Workforce Housing Program covers households up to 120% of AMI and uses no federal, state or county funding. Buyers accept a deed restriction that limits resale prices for a set period. In 2024 the county also eased its rules for accessory dwelling units and adopted an ordinance allowing pocket neighborhoods, which are clusters of small homes around shared open space.

The New Castle County Housing Authority reports helping roughly 1,650 families with vouchers outside Wilmington and Newark.

Kent County

Kent sits in the middle geographically and statistically. Its share of assisted housing roughly matches its share of population. Nearly all of its projected need is for year-round residents. The assessment found that homebuilding in Kent fell short of household growth between 2010 and 2020. Southern Kent had the state’s largest share of single-family detached homes, at 74%.

Kent County’s community development office offers grants to repair owner-occupied houses and manufactured homes. It serves the unincorporated county and 19 municipalities. The City of Dover is not included.

Sussex County

Sussex is where the shortage is sharpest. The county needs about 63% of the homes the state must add by 2030 and 98% of the projected seasonal homes. Year-round workers compete with retirees and second-home buyers for the same land. A 2019 county study found that accommodation, food service and retail made up more than one in three Sussex jobs and paid below-average wages. The related guide on resort and rural communities explains this pattern in more detail.

Manufactured housing matters more here than elsewhere. Mobile homes were 16% of homes in western Sussex and 14% in eastern Sussex in 2021, against 7% statewide. The statewide count fell by about 6,800 homes between 2010 and 2021.

Sussex has two local tools:

• Sussex County Rental Program. Created in 2008 and expanded in 2022, it gives developers incentives to include affordable rentals in the county’s Coastal Area. Tenants must earn between 30% and 80% of AMI.
• Sussex County Housing Trust Fund. This local housing trust fund launched in April 2022 with $500,000 in county funds and $6.3 million in federal pandemic relief money. It funds development and direct help for homebuyers.

Fair Housing and Tenant Protections

The Delaware Fair Housing Act covers more groups than federal law. It adds marital status, sexual orientation, gender identity, creed, age, military status, housing status and source of income.

Source of income discrimination matters most to voucher holders. Delaware law defines source of income to include government rental assistance. For years the law also said landlords were not required to take part in voucher programs.

A law approved in August 2024 suspends that clause through December 31, 2028. The change is conditional. It applies from January 1, 2026, or from the date the state housing agency publishes notice that the housing authorities have adopted a standard process for approving voucher leases, whichever is later. The five authorities announced a shared electronic approval process that began on November 1, 2025.

Landlords may still apply income and credit standards if they apply them in a commercially reasonable way and without regard to the source of income. They may also turn down an application if a housing authority does not follow the standard process. Because the change is conditional and temporary, renters and landlords should confirm the current rules with the Delaware Division of Human and Civil Rights.

State law also gives tenants with household income at or below 200% of the federal poverty guidelines a right to legal representation in eviction cases and certain other landlord-tenant proceedings, with some exceptions. The right is being phased in through June 30, 2028, subject to funding.

Where to Get Help

Phone numbers are those listed by each agency in October 2026.

• Emergency shelter or homelessness. Call Centralized Intake, run by Housing Alliance Delaware, at 1-833-346-3233 on weekdays. Or dial 2-1-1.
• Vouchers and public housing. Apply on the statewide waiting list at Delaware.AffordableHousing.com. DSHA’s Housing Admissions Office is at (302) 739-6940.
• Affordable rentals. Search DelawareHousingSearch.org, a listing service DSHA links to.
• Buying a home. Contact a lender in the Delaware Mortgage Program or a housing counselor. DSHA’s toll-free line is (888) 363-8808.
• Falling behind on a mortgage. Start with a free housing counselor. DSHA’s emergency mortgage assistance program was not taking applications as of October 2026. Delaware also has a mandatory mediation program for residential foreclosures.
• Home repairs. Contact your county’s community development office.
• Discrimination. File a complaint with the Delaware Division of Human and Civil Rights or with HUD.
• Income limits. Use HUD’s income limits lookup. The guide on who qualifies for affordable housing explains how to read the income limits.

The Bottom Line

Delaware’s housing need is well documented and concentrated. Sussex County carries most of the projected need for new homes and has the least subsidized housing. New Castle County holds most of the assisted homes and has the highest housing wage. One state agency, Housing Delaware, runs most programs. County and town governments control zoning and add their own incentives. For residents, the practical starting points are the statewide waiting list, a housing counselor and HUD’s income limits lookup.