The hardest part of small-scale affordable housing is not framing cost or land price. It’s waiting. Ryan Basye, who runs Basye Real Estate Concepts and the On Deck Housing 501(c)(3) in Omaha, can go from start to finish on a build in 10 to 12 weeks. Then he waits six to nine months for a city to approve it.
That gap is where the margin dies. Capital sits idle, holding costs accrue against nothing, and a product that has to sell at an affordable price absorbs every month of delay. Most affordable housing development challenges trace back to that one number.
Below: the actual math on a build-versus-approval timeline, why smaller jurisdictions clear faster and what you give up, how operators fund the slow side with an income-producing arm, and the systems Basye uses so his rentals and nonprofit keep running when he isn’t in the office.
Key takeaways
- A build can take 10 to 12 weeks start to finish while city approvals run six to nine months — size your pipeline to approval lead time, not construction time.
- Basye built three homes in a smaller town outside Omaha in the time it took to get one final permit inside the city of Omaha.
- Affordable housing only works at scale or with a separate income source. If one house takes a year, scale is off the table, so a brokerage, rentals or another cash-flowing arm is the real funding mechanism.
- Carry a 5% contingency on renovation budgets for the problems you only find by opening walls.
- Post the full contractor call list on the tenant’s refrigerator so repairs route directly to the plumber, electrician or HVAC tech, with invoices and photos sent back to you.
From the Real Estate Pros Show
This article draws on an interview with Ryan Basye of Basye Real Estate Concepts / On Deck Housing on the Real Estate Pros Show, hosted by Meghan Escobar.
The Real Math: A 5-Week Build Behind a 9-Month Approval
Basye can put a house up in about five weeks and run a project start to finish in 10 to 12 weeks. City approvals take six to nine months. That mismatch, not stick-and-brick cost, is what turns a thin affordable deal into an impossible one.
Think about what’s happening to the money during those months. Land is bought or under contract, plans are drawn and paid for, and none of it is producing anything.
You have capital on the sidelines and every investor will tell you that’s dumb. There’s no ROI. It’s kind of just stagnant.
On a market-rate build you can price that carry into the exit. On affordable housing you cannot — the whole point is the back-end price stays low. So every month of review comes straight out of an already compressed spread, and there is no room left to absorb it.
The planning consequence is just as brutal as the financial one. As Basye puts it, if it’s September, you’re thinking about September of next year. Your annual production number is not set by how fast your crews work; it’s set by how many approval cycles you can have running at once.
Practically, that means two changes to how you underwrite:
- Budget carrying cost across the approval window, not the construction window, and know what that dollar figure is before you buy the lot.
- Stagger entitlement submissions so you always have permits landing, rather than clustering builds and then idling for two quarters.
On-deck Housing has completed six units in the last year and a half against a target of 20 a year. The gap between those two numbers is almost entirely approval time.
Jurisdiction Shopping: Why Smaller Towns Clear Faster
The single highest-leverage decision in affordable housing development challenges is where you file. Basye’s comparison is hard to argue with: his team built three homes in a smaller town outside Omaha in the time it took to get one final permit inside the city of Omaha.
The reason is structural. Big-city review means more departments, more utilities, more taxing bodies and more sets of eyes, each with its own queue. Basye had one project hang up on getting the city arborist to sign off on which tree would be planted. That is the level of granularity you’re negotiating with, and each layer adds weeks.
Smaller jurisdictions have fewer layers and often more appetite — a town that wants workforce housing for its own employees tends to move. Basye also notes that recent federal legislation opened grant money to towns of certain sizes for workforce housing. Treat that as a lead to verify with your own state and municipal offices, not a program you can bank on from a podcast.
The tradeoff is real and you should price it:
- Smaller buyer pool. Fewer end buyers and fewer tenants means longer marketing time and less pricing power.
- Thinner demand density. A vacancy in a town of a few thousand is not the same risk as a vacancy in a metro of a million.
- Fewer trades. Your contractor bench may not travel, and out-of-town crews cost more.
The math often still favors the small town, because six months of dead capital costs more than a slightly slower sale. Run both versions before you assume the metro lot is the better buy.
We can build that house in five weeks, but otherwise we would just be sitting there waiting. You have capital on the sidelines, and every investor will tell you that’s dumb. There’s no ROI.
— Ryan Basye, Basye Real Estate Concepts and On Deck Housing
Why There’s Almost No Competition in This Niche
Basye’s explanation for the lack of competitors is blunt: there’s no money in affordable housing, which is exactly what the name means. The price is affordable to the buyer because the builder isn’t making much on the back end.
From that follows a clean test for whether you can operate here at all. There are two conditions, and you need one of them:
- Volume. Thin margins work if you do enough units. But volume is off the table when a single house takes a year to get approved.
- An outside income source. Basye funds On Deck Housing largely himself, with the brokerage and rentals carrying the load.
If you have neither, you are not running an affordable housing business — you are subsidizing one out of savings until the savings run out.
The upside of the thin margins is the culture. Among small affordable operators, Basye describes something closer to collaboration than competition. Operators occasionally bid on the same property, but if he loses one, he tells the winner to move forward and offers to share how he’d approach it. The playbooks circulate because nobody is defending a fat margin.
That’s worth knowing if you’re entering the space. The fastest way up the learning curve is to call the people already doing it in your region, because they will generally take the call. Basye’s larger point is that the scarce resource here is not deal flow or ideas — it’s time and capital, and both of those get burned by the approval process rather than by rivals.
Structuring the Business So the Slow Side Doesn’t Sink You
Basye keeps three separate sets of books, and the separation is what lets a money-losing mission run next to a money-making business without either one blurring the other:
- Basye Real Estate — the rental properties.
- On Deck Housing — the 501(c)(3) that builds and converts affordable units.
- The brokerage — investor-focused buying and selling in the Omaha metro.
Keeping them in their own columns means he can see which one is actually carrying the others, and the nonprofit’s reporting stays clean. A CPA handles the annual work; the books are maintained through the year. If you’re pairing a nonprofit with for-profit activity, talk to your own CPA and counsel about how to structure it — the requirements are not generic.
On the renovation side, he carries a 5% contingency for the unknowns. His framing: you only find some problems by doing the work — you open a wall and there’s a bee’s nest, or raccoons in the ceiling. On a conversion project, that line is not optional.
There’s no payroll. Basye is the operator, with 1099 back-office help split between paperwork and office work. He’d rather keep the structure light than deal with the compliance overhead that comes with a formal team in Nebraska.
His honest answer on what breaks if he disappears for 30 days is a useful diagnostic for any owner-operator: the nonprofit holds, the rentals hold, and the brokerage side falls hard. That’s the natural consequence of a relationship-driven brokerage — and it tells him exactly where the single point of failure sits.
Operating Rentals So They Run Without You
The reason Basye’s rentals survive his absence is one tactic worth copying this week: the complete contractor call list is posted on the refrigerator in every unit.
Clogged toilet, dead fridge, lights out — the tenant calls the tradesperson directly. Nobody calls a manager who calls an owner who calls a plumber. The contractor does the work, then sends the invoice back to Basye with a description and a photo, which also settles whether it was a tenant issue or a house issue.
Two things make that work, and neither is the list itself:
- Long relationships. Basye has used the same plumber, electrician and HVAC tech for 15-plus years, going back to his flipping days. Those businesses grew alongside his. You cannot hand a tenant a phone number for a contractor you met last month.
- A stated boundary. His voicemail says that after six and on weekends is family time. His position: there are no real estate emergencies. If it’s a genuine emergency, the number to call is 911.
The boundary is what makes the refrigerator list necessary rather than optional. Once the tenant knows nobody is answering the phone at 9pm, and the fix is a direct call to someone who will actually show up, the system routes around the owner by design.
If you want this in your portfolio, start by building the bench. The list is the last step, not the first.
What Makes a Midwest Market Work for Out-of-State Buyers
Basye’s pitch for Omaha is stability, not appreciation. His words: it’s the mutual funds of real estate — the kind of property you hold and don’t brag about, because it just keeps together.
The specifics behind that, as he reads his own market:
- A metro of roughly a million people, with Iowa right across the river.
- Landlord-friendly state law.
- Low, stable vacancy rates.
- Prices well below what buyers from California, Texas and Florida are used to.
- Around 10,000 vacant lots inside the city — his view of the infill inventory, and the reason his goal is 100 smaller, nicer homes a year.
He gets most out-of-state inquiries through BiggerPockets and referrals, and says newcomers are usually taken aback by the price-to-vacancy combination.
His 2026 read: the residential market is slow and, in his words, churning toward something that feels 2008-ish. The investor and commercial side still has room — apartment buildings, transitional housing, office conversions and storage. That’s where his own attention has gone, and it’s consistent with the affordable strategy. Empty office space is a candidate for low-income conversion, and one building turning into four units counts the same as four ground-up houses toward his 20-unit annual target.
Treat all of that as one operator’s assessment of one market. The transferable idea is the screen he’s applying: stable vacancy, landlord-friendly law, entry prices low enough that an affordable exit price still works, and a supply of infill lots nobody is competing for.
Frequently asked questions
Why doesn’t affordable housing generate normal developer margins?
Because the exit price is capped by design. As Ryan Basye puts it, it’s affordable to the buyer precisely because the builder isn’t making much on the back end — so there’s no room to price in delays, cost overruns or carrying costs the way a market-rate builder can.
That leaves two viable models: do enough volume that thin per-unit margins add up, or fund the work from a separate income source. Basye’s brokerage and rental portfolio carry his nonprofit build arm.
How long should I budget for permits and approvals on an infill build?
In a major city, Basye’s experience is six to nine months for approvals — against a build that can be finished in 10 to 12 weeks. That’s his market, so verify locally, but plan your capital and your annual production around the approval window rather than the construction window.
The practical test: ask your target jurisdiction how many departments must sign off, and whether reviews run in parallel or in sequence. Sequential reviews are where multi-month timelines come from.
Is it better to build affordable housing in a major city or a smaller outlying town?
Smaller towns usually clear faster. Basye built three homes in a town outside Omaha in the time it took to get one final permit inside the city — fewer departments, fewer reviewers, and often more local appetite for workforce housing.
The tradeoff is a smaller buyer pool, less demand density and a thinner contractor bench. Run the numbers both ways, because months of idle capital in the metro frequently cost more than a slower sale in the small town.
What contingency percentage should I carry on a renovation budget?
Basye carries 5% for the unknowns on renovation projects. His reasoning is that some problems only reveal themselves once work starts — you open a wall and find a bee’s nest or raccoons in the ceiling.
On conversions of older commercial buildings, where systems and structure are less predictable than in single-family, treat 5% as a floor rather than a ceiling.
How do you keep rental properties running when you’re not available for weeks at a time?
Post the full contractor call list inside the unit — Basye puts it on the refrigerator — so tenants call the plumber, electrician or HVAC tech directly for a clogged toilet, a dead fridge or lights out. The contractor sends the invoice back to you with a description and photo.
This only works with trades you’ve used for years and who will answer. Basye has worked with the same core contractors for 15-plus years, which is why he can hand a tenant their numbers.
The bottom line
Before you buy another infill lot, call the permit office in two jurisdictions you could realistically build in and ask how many sequential reviews a single-family build requires. That one answer determines your production capacity, your carrying cost and whether the deal pencils at all — everything else is downstream of it.
