Area Median Income (AMI) is defined as the midpoint of a specific area’s income distribution and is calculated on an annual basis by the Department of Housing and Urban Development (HUD). HUD refers to the figure as MFI, or median family income, based on a four-person household.
AMI is used extensively for assessing affordable housing eligibility. For instance, most affordable housing properties require that the income of a prospective resident falls under a specified percentage of AMI to lease a unit. These AMI requirements are generally mandatory to take advantage of low-income housing tax credits, or LIHTC.
This metric is also essential for forecasting rental income. Typically, affordable housing rents are locked to a maximum of 30% of a household’s monthly income, though in some cases this may be higher.
The most recent MFI calculations can be found on the HUD User web portal.