Affordable housing isn't just an urban issue - suburban planners are facing it, too

December 5, 2017                          By: John Aguilar

Westminster, Commerce City, Golden, Lakewood and Castle Rock are all responding to the challenge

The redevelopment of the former Westminster Mall has been billed as an opportunity to redefine suburban America. A piece of that renewal attacks a growing problem across the Denver metro area: the scarcity of affordable housing.

Construction continues at the site of the old Westminster Mall on Dec. 1, 2017 in Westminster.  RJ Sangosti, The Denver Post

To that end, at least 118 apartments at the heart of the marquee site will be open to people making anywhere from 30 to 60 percent of the area median income.

They will be among more than 600 affordable housing units in Westminster that have been proposed, are planned or are under construction — other suburban communities are making similar efforts — as home values and rental prices continue to spike in Denver.

“Westminster is being very forward-thinking — advancing workforce and affordable housing has been a high priority for the City Council,” said Jenni Grafton, senior economic development officer for Westminster. “But while it’s important that every municipality takes action at the local level, we have to take a regional approach to the problem.”..................Read More

Developers, advocates of affordable housing cautiously watch tax reform debate

December 4, 2017                                        By: Jim Buchta

Developers rush to finish projects amid worry that the GOP bill will stifle renovation and construction of apartments and houses for low- to moderate-income families.

Developers of affordable housing in the Twin Cities are bracing for the worst as Congress reconciles tax reform proposals that they fear will stifle renovation and construction of apartments and houses for low- to moderate-income families.

The view from a third-floor balcony facing a city park at Oxford Village, a new 51-unit affordable housing complex along Blake Road N. in Hopkins.

Though the fate of the change is unclear, several Twin Cities developers have been scrambling to line up financing commitments before year’s end. Fast-tracking those projects is expensive and complicated, but many worry that projects that don’t close before the end of the year won’t happen at all.

“There’s a ton of uncertainty,” said Chris Barnes, vice president and senior project partner at Plymouth-based Dominium, one of the nation’s largest rental developers and owners. “People are scrambling like mad to get everything closed.”................Read More

How Congress's Tax Plans Could Kill a Million Affordable Homes in a Decade

December 4, 2017                            By: Kriston Capps

Early on Saturday morning, the Senate passed a $1.5 trillion tax overhaul by a razor-thin margin. Draft pages of the tax bill were still being added to the legislation even as senators were debating taking the weekend to read the bill.

New housing construction in St. Louis. The Development is receiving federal low-income housing tax credits.//Jeff Roberson/AP

Looking at the Senate bill in the bright light of day, it’s hard to see any evidence that congressional Republicans see the tax code as a way to solve the housing affordability crisis. That’s one difference between the tax reform today and the last push in 1986, which used tax incentives to spur developers to build safe, affordable housing.

Tax reform in 2017 doesn’t include any ideas for making homes more affordable. Instead, Congress can only make the problem worse by transferring wealth to the very wealthy and sharpening income inequality. Instead of designing brand new credits to draw even more investment (profitably!) to poorer communities, the GOP is writing a tax bill to kill or curb the programs that work and funnel investment in the other direction...................Read More

Tax overall could mean big changes for developers working affordable housing, historic properties

November 29, 2017                                     By: Sara Freund

For those concerned with recent proposals to overhaul the nation’s tax code, it can feel like they’re dealing with a giant pile of what-if and if-then scenarios. The proposals from the House and Senate aren’t winning over everyone, but do they ever? But within the tax bill lie a few key components that are important for the commercial real estate industry in Chicago. This includes changes to the New Markets Tax Credit program and the federal Historic Tax Credit program.

On Nov. 16, the House passed a significant tax overhaul, just two weeks after the bill was unveiled. Eyes are now on the Senate, where members will attempt to move ahead with their own proposal. There are significant differences between the House bill and the Senate bill, but what’s important for many Republicans is to deliver the first major legislative victory for President Trump.

In the House bill, the new markets tax credit, the federal historic tax credit and the non-historic rehabilitation credit would be eliminated after 2017. The HTC program is an important tool for incentivizing the redevelopment of older buildings—something that developers, planners and preservation advocates value greatly. The NMTC program was initiated to incentivize community development and economic growth through tax credits that attract investors to distressed communities................Read More

The Tax Overhaul Could Mean Falling Home Prices and Less Affordable Housing

November 28, 2017                          By: Charlie Herman

The Senate this week is expected to vote on Republican-sponsored legislation to overhaul the nation’s tax code. A vote could come as early as Thursday, but before that happens, there’s going to be a lot of horse-trading to secure enough Republican votes to pass the bill (Democrats are united in their “no” vote).

If it feels like this all happening really fast, it is. Republicans want to get a bill to the President to sign before Christmas. In the rush, keeping track of any changes in the Senate’s version is challenging. And if a tax bill does get more than 50 Republicans, then the legislators from both chambers will have to meet and iron out the differences between the two bills.

So while there isn’t a final version yet, it’s clear from the House bill and the outline from the Senate for how it plans to pay for tax cuts (that will still add $1.4 trillion to the deficit over the next 10 years) that the tax overhaul will affect homeowners and renters in the New York City and New Jersey area...................Read More

Tax Proposal Threatens Affordable Housing in Iowa

November 21, 2017                       By: Deidre Schmidt & Eric Burmeister

While you might not realize it, tax policy is housing policy.

Current tax reform proposals might seem benign, but in their current form they could negatively impact the housing of thousands of families, children, veterans, seniors and people with disabilities.

(Photo: J. Scott Applewhite, AP)

The Low Income Housing Tax Credit has been the primary way the private sector has built affordable housing ever since the last round of tax reform under President Reagan.

However, because these tax expenditures are complex and not direct and immediate subsidies, they are hard to understand for most people. They are therefore vulnerable to elimination without a complete appreciation of the consequences.

With just a few pieces of information, we believe each of us can understand and influence what happens to our country’s most extensive affordable housing program................Read More

LIHTC Market Waits for Tax Reform Resolution

November 20, 2017                  By: Donna Kimura

Investors and syndicators discuss the equity market at AHF Live.

“Welcome to disruption 2.0.”

That was the greeting from Mark Siranovic, senior vice president for multi-investor fund markets at the National Equity Fund and one of the panelists on the Tax Credit Equity Outlook Power Panel at AHF Live in Chicago.

Fred Copeman, Stephen Daley, Marge Novak, and Mark Siranovic (left to right) discuss changes in the low-income housing tax credit market and the AHF Live conference in Chicago.

Siranovic and other low-income housing tax credit (LIHTC) syndicators and investors detailed the changing dynamics of the market as Congress works to overhaul the tax system. The market was jolted by the 2016 election, which gave Republicans control of the White House and both houses of Congress and increased the prospects for tax reform.

“Last year, you had the three-month blowup of the market, and then we found equilibrium again,” Siranovic said. “A couple of weeks ago, you started phase two of that. I think the market will quickly adjust once somebody can give us an accurate and final set of guidelines and rules to play by.”.................Read More

Fannie, Freddie to Re-Enter LIHTC Market

November 17, 2017                               By: Donna Kimura

Each GSE is allowed to invest $500 million annually in housing credits.

Fannie Mae and Freddie Mac are returning to the low-income housing tax credit (LIHTC) market as investors.

The government-sponsored enterprises were given the go-ahead to invest in housing credits on a limited basis by the Federal Housing Finance Agency (FHFA), which cited several factors for its decision, including furthering the enterprises’ mission to support affordable housing and ensuring that they could provide “a countercyclical role in the LIHTC market in the future if needed.”

Each enterprise will have an annual investment limit of $500 million, less than a 5% market share for each. Within this funding cap, any investments above $300 million in a given year are required to be in areas that have been identified by FHFA as markets that have difficulty attracting investors. These investments are designed to preserve affordable housing, support mixed-income housing, provide supportive housing, or meet other affordable housing objectives.

Fannie Mae and Freddie Mac were two of the nation’s largest LIHTC investors, representing an estimated 35% to 40% of the market, before being placed into conservatorship by FHFA in 2008. The enterprises’ financial condition deteriorated during the housing market crash, requiring government intervention................Read More

Freddie Mac to invest $500M in Low-Income Housing Tax Credit Market

November 17, 2017                  By: WFGNTIC

REPOSTED DIRECTLY FROM INMAN NEWS. THIS CONTENT HAS NOT BEEN MODERATED BY WFG NATIONAL TITLE.

Freddie Mac today announced its re-entry into the Low-Income Housing Tax Credit (LIHTC) market as part of the newly launched Duty To Serve program, an initiative geared toward addressing persistent affordable housing problems by preventing foreclosures, responsibly expanding credit, educating future borrowers, counseling current borrowers and supporting affordable rental housing.

Freddie Mac’s first investment is expected to close in January 2018, with a $500 million annual investment cap. Freddie Mac will partner with and invest through experienced LIHTC syndicates, focusing mainly on markets that are often overlooked of underserved by most investors.

The LIHTC program provides incentives to multifamily property owners and investors to build and maintain quality affordable housing for low and very low-income households across the United States.............Read More

A Provision Buried In The House Tax Bill Could Slow Affordable Housing Construction

November 17, 2017                         By: Arthur Delaney

Republicans are rushing to pass a tax bill that could have all kinds of side effects.

WASHINGTON ― A little-noticed provision in the Republican tax reform bill that passed the House on Thursday could have a big impact on affordable housing construction.

Speaker of the House Paul Ryan, along with his leadership, celebrate passing the House tax bill.

The House bill maintains a tax subsidy for low-income housing construction, but ends the tax-free status of certain bonds that builders rely on to arrange financing.

Developers say the mere threat of the policy change already has them scrambling to close deals for upcoming projects before the end of the year, when funding could disappear.

Chris Akbari, president the Itex Group, a development company in Texas, said his firm is in the process of closing a $49 million deal to buy and rehabilitate a low-income apartment complex in Houston....................Read More

Affordable housing advocates say Trump tax reform bill is 'devastating'

November 3, 2017                           By: Jeff Andrews

Elimination of private-activity bonds would lead to steep drop in affordable housing units

Affordable housing advocates were cautiously optimistic that the House tax reform bill would have only modest effects on low-income housing after the Trump administration’s framework explicitly retained the tax credit responsible for virtually all construction and preservation of low-income housing units—the Low-Income Housing Tax Credit (LIHTC).

Shutterstock

While the House’s tax reform bill released Thursday does include LIHTCs, the unexpected elimination of private-activity bonds would have devastating effects on the construction and preservation of affordable housing. When combined with other changes the bill proposes, accounting firm Novogradac & Company estimates a loss of nearly 1 million affordable housing units produced over 10 years........................Read More

America's affordable-housing stock drops

October 23, 2017                  By: Washington Post

Decline seen from 2010 to 2016

This neighborhood is in Cary, N.C. CREDIT: Bloomberg photo by Luke Sharrett

The number of apartments deemed affordable for very low-income families across the United States fell by more than 60 percent between 2010 and 2016, according to a new report by Freddie Mac.

The report by the government-backed mortgage financier is the first to compare rent increases in specific units over time.

It examined loans that the corporation had financed twice between 2010 and 2016, allowing a comparison of the exact same rental units and how their affordability changed............Read More

What Trump's tax reform could mean for affordable housing

November 2, 2017                               By: Jeff Andrews

An explainer on the corporate tax rate cut that could cause a drop in new affordable housing

The affordable housing shortage in the United States was put in stark terms in October when Freddie Mac reported that homes available to very low-income Americans dropped by more than 60 percent in just six years between 2010 to 2016.

The units, developed for people who make less than 50 percent of the area median income, have began to run short because of rising rents, stagnant wages, and fluctuations in federal programs that subsidize housing.

To affordable housing advocates, it’s a clear signal that the country can hardly sustain a disruption to the construction of new affordable housing. Yet that’s what the Trump administration’s tax reform proposal— highlighted by a corporate income tax cut from 35 to 20 percent — risks doing if the tax incentives big banks receive to invest in affordable housing projects are weakened............Read More

House Bill Seeks 50% Increase in LIHTCs

October 31, 2017                  By: Affordable Housing Finance

The latest legislation comes from Rep. Suzan DelBene.

U.S. Rep. Suzan DelBene (D-Wash.) introduced the Access to Affordable Housing Act to increase the low-income housing tax credit (LIHTC) by 50% today.

“Making sure that every American has a safe and affordable place to call home is a moral imperative that we must address,” DelBene said in a statement. "To help lift families out of poverty and expand access to affordable housing, we need to increase the low-income housing tax credit. Washington has seen it firsthand. Housing options are not keeping pace with demand, and my legislation would help ensure more families can find stable, affordable housing.”

Reps. Adam Smith and Pramila Jayapal are co-sponsors of DelBene’s bill—all of whom represent Washington’s King County, where housing demand and costs have sky rocketed in recent years. In their state, nearly 400,000 households pay half their income in rent...............Read More

As Tax Reform Heats Up, Multifamily Industry Readies

October 26, 2017                      By:    Brian Croce

The bill may be unveiled next week.

When it comes to policymaking, tax reform has been the most prominent topic of discussion in the past few weeks in the nation’s capital, with President Donald Trump calling for lawmakers to put a bill on his Oval Office desk by Thanksgiving.

Trump met with Senate Republicans Tuesday, as the details of the proposed plan were being ironed out before they’re unveiled to the public, potentially next week.

The National Apartment Association launched its Protect the Lease campaign in May.

The implications, or benefits, tax reform may have for the multifamily industry remain to be seen.

“I wish I could tell you where things were, but we’re all looking at our crystal balls anticipating next week, when we actually see something in writing,” National Apartment Association (NAA) president and CEO Robert Pinnegar told MFE Wednesday.............................Read More

What Does the Need for Affordable Housing Look Like?

October 25, 2017                               By:  Morgan Kinney

The documentary Our Journey Home comes to Houston to illustrate the benefits of much-needed public housing.

HOUSTON DOESN’T HAVE THE LOOMING public housing projects ubiquitous in cities like New York and Chicago. Those sprawling complexes and towers were largely built in the postwar decades when the Bayou City was, well, a much smaller place. Even now, as the fourth largest city, Houston Housing Authority CEO Tory Gunsolley says Houston continues to have one of the lowest rates of affordable housing for a city of its size—a shortfall only exacerbated by recent disasters.

“Post-Harvey, the need for affordable housing has increased,” Gunsolley says. “More people have realized that it is scarce, so it’s a perfect time for Our Journey Home to come to Houston.”

Set to screen in Houston Monday, Oct. 30, Our Journey Home is a 2015 documentary from ReThink, a group that educates and promotes the benefits of public housing with things like public service announcements and a songwriting contest that asked public housing residents “Why Housing Matters.” The film follows three families in public housing to illustrate how this bulwark against homelessness keeps them going, working against negative stereotypes. “Once you say you’re homeless, it’s like your character is out the window,” says one of the film’s subjects..............Read More

Affordable Housing Shortfall Continues to Grow

October 23, 2017                 By:  Steve Guggenmos

Freddie Mac finds big drop in units remaining affordable at second financing.

The shortfall of affordable rental units has widened considerably during the past six years, according to a new report released by Freddie Mac Multifamily.

The research finds that a combination of increasing rents and stagnant household incomes is causing the growing problem, which could become even worse if actions are not taken to increase the supply of affordable units commensurate with the increasing demand from lower-income renters. Previous Freddie Mac research has found that growing demand and rising costs of land and construction have led to a widening supply gap—with the country experiencing an annual shortfall of approximately 400,000 housing units, even when taking single-family starts into account.

Steve Guggenmos

The latest report takes a new approach to analyzing affordability, looking at loans that Freddie Mac Multifamily financed multiple times between 2010 and 2016. The mortgage giant examined loans covering more than 97,000 units..........Read More

Why is 'Affordable' Housing So Expensive to Build?

October 19, 2017                         By: Joe Cortright

As costs keep rising, it’s becoming harder and harder for governments to subsidize projects like they’ve done in the past.

It’s a problem that isn’t going away: the so-called “affordable” housing we’re building in many cities—by which we mean publicly subsidized housing that’s dedicated to low- and moderate-income households—is so expensive to build that we’ll never be able to build enough of it to make a dent in the housing affordability problem.

Andrew Yates/Reuters

The latest case in point is a new affordable housing development called Estrella Vista in Emeryville, California, (abutting Oakland and just across the bay from San Francisco). A non-profit housing developer just broke ground on a new mixed-use building, about three-quarters of a mile from a local BART transit station, which will include 84 new apartments. The project also houses about 7,000 square feet of retail space. The total cost: $64 million................Read More

Local Rules and Affordable Housing Options

October 16, 2017                           By: John McManus

A tide of young activists in metros that have gotten too expensive to develop will move the NIMBY needle, or move, period.

Grabar offers a microcosmic view of American housing's theme and variations here in an article, titled "San Francisco's Civil War."

The Slate sub-headline reads, "YIMBYs! Socialists! The only thing the Bay Area’s tenant activists hate more than high rent is each other."

Slate finance writer Henry

But both the title and the subhed belie the true breadth of the story, which Grabar captures in his lead sentence.

"Local politics is always, in one way or another, about housing."

Policy-makers and economists focus on national levers they might engage or release to get housing back on track compared with prior recovery periods following a cyclical trough...........Read More

Congress Has a Great Way to Create New Housing After Hurricane Disasters

October 6, 2017                               By: Kriston Capps

After Katrina, expanding tax credits helped the Gulf Coast rebuild affordable rental housing. It can work in Texas, Florida, and Puerto Rico, too.

In the aftermath of Hurricane Katrina, Congress passed one disaster recovery package with a special mission in mind. The bill was designed specifically to encourage developers to rebuild or create new affordable rental housing in the Gulf Coast. The plan worked: The 2005 act spurred millions of dollars in new investment in the recovery, creating or restoring tens of thousands of housing units for low-income families.

Local residents ride a horse by a house wiped out by Hurricane Maria in Jayuya, Puerto Rico

Congress hasn’t passed another similar disaster recovery bill since. Despite the damage wrought by Superstorm Sandy, efforts to put together the right grab-bag of tax incentives and community grants to rebuild affordably failed to materialize......Read More

Housing Shortage Stalls Economic Growth, Prices Out Workers

October 16, 2017                   By: Bendix Anderson

For many cities and towns, the lack of affordable housing threatens their economic vitality.

Cities and towns across the U.S. are competing for the attention of technology giant Amazon, which plans to create a second headquarters somewhere in the U.S.

“Quality of life,” which typically balances a town’s amenities against the cost of living there—starting with the cost of housing—is near the top of Amazon’s wish list for its new location. Cities where the cost of housing is too high are likely to miss out on the tens of thousands of new jobs and the likely billions of dollars in new investment that will come as a result of attracting Amazon’s new digs.

In this scenario, and others like it, economic development officials across the country are finally recognizing realities that may seem self-evident to affordable housing experts: A shortage of affordable housing can come with a steep cost in missed opportunities, homelessness, stalled growth, congested roads, and young people being priced out of the area..........Read More

Tackling the Affordable Housing Crisis

October 13, 2017                 By: Paul Rosta

A panel of industry veterans offered a sober assessment and strategies for progress at the Institute of Real Estate Management’s annual summit in Chicago.

Chicago—What’s ahead for affordable housing? A panel of industry veterans offered a sober assessment and strategies for progress on Wednesday afternoon at the Institute of Real Estate Management’s annual summit in Chicago.

Panelist discuss affordable housing with audience members at IREM Summit in Chicago. From left, speakers included Gwen Volk, David McGuill, Eileen Wirth and Pamela Monroe.

Funding poses a significant challenge, reported Eileen Wirth, president & CEO of the Octavia Hill Association, a century-old Philadelphia nonprofit. “Unfortunately, moving forward, it’s not looking much brighter,” she said. The Trump Administration’s proposed budget hits calls for flat funding, so that operators will be unable to count on increased payments to offset rising costs. “It will be a bit of a challenge,” she noted. “Hopefully, we won’t run into any major capital needs.”..............Read More

More Institutional Investors Warming Up to Workforce, Affordable Housing

October 9, 2017                       By: Randyl Drummer

Pension Funds, Insurers and Private Equity Jumping Into Tight US Market for Affordable Apartment Housing

Institutional investors are shelling out significant amounts of capital to take debt and equity positions in affordable and workforce housing as the long U.S. apartment bull market enters its later stages and yields tighten on new upscale apartment supply in major U.S. markets.

TruAmerica Multifamily, Beacon Communities and other apartment developers and operators have been expanding their stakes in the affordable and workforce space, while investment managers and equity and debt funds such as LEM Capital LP, TH Real Estate and Sabal Capital Partners have all recently announced ventures with well-financed funds and companies such as Allstate Corp. and large pension funds such as California State Teachers' Retirement System (CalSTRS) and Pennsylvania Public School Employees' Retirement System, which are ramping up allocations to workforce and affordable housing acquisition and development..........Read More

LIHTC Ready to Assist with the Shortage of Affordable Housing Exacerbated by Hurricanes Harvey and Irma

September 20, 2017                            By: Roman Petra

As many as 40,000 homes in Houston were destroyed by Hurricane Harvey, while the Florida Keys saw at least 25% of the homes destroyed by Hurricane Irma. Before the hurricanes, there was already a deficiency of affordable housing. Now, the need is even greater, if not dire, to bring affordable housing to those living in the hurricane devastated areas. Different agencies will focus their efforts through various programs to stimulate the development of affordable housing, but one of the best catalysts for development of affordable housing is the Low Income Housing Tax Credit (LIHTC) program, pronounced “lie-tech.” The program was created by Congress in 1986 to raise private equity for construction and rehabilitation of affordable housing by allocating federal tax credits to the owners of the developments. The private equity subsidizes the development, allowing for either some, or all, of the units to be rented at below-market rates to low income tenants.

The LIHTC program has become an integral tool for developing affordable rental housing. The LIHTC program has stimulated the construction and rehabilitation of nearly 3 million affordable homes, supports over 100,000 jobs annually, and generates approximately $9 billion in annual wages and business income. Today, as much as 30 to 40 percent of all new multifamily construction is subsidized using LIHTC. Up to 90 percent of the cost of a rental complex, with the right mix of low income units, may be returned to the owner in federal tax credits............Read More

Affordable Housing Veteran Drives RAD Forward

September 15, 2017                                 By: Donna Kimura

Tom Davis and the Rental Assistance Demonstration team are finalists for government service award.

While a student at Brown University, he volunteered with a community organization building housing in a disadvantaged neighborhood in Providence, R.I. On Friday afternoons, he would go out and help at their construction sites. “It got me interested in the issues and the questions of low-income communities and urban development,” he says.

A few years later, when Davis graduated from law school, he looked for and joined a firm that had an affordable housing practice. It was the start of a respected career in the industry that has included positions at two leading Boston-based nonprofit organizations, The Community Builders and Preservation of Affordable Housing.

For the past two years, Davis has been director of the Department of Housing and Urban Development’s (HUD’s) Office of Recapitalization, where one of his key roles is spearheading the Rental Assistance Demonstration (RAD) program, the centerpiece of HUD’s strategy to preserve at-risk public and assisted-housing developments..............Read More

Chicago's Affordable Housing Quagmire About to Get Deeper

October 3, 2017                       By: Gary Lucido

Chicago has a long standing love affair with the notion of "affordable housing" - not CHA built housing but privately developed housing that people below various income limits can afford to buy or rent and are granted access to this housing by the city. But it's not clear if they really love affordable housing or just the idea of affordable housing or if maybe they just hate gentrification. And who is "they" anyway?

In all fairness there are different constituencies who have different views on what is "affordable", where it should be located, and how it should be created. As with most things Chicago there is a messy political process for determining the policy. Best I can tell the city has had an Affordable Requirements Ordinance (ARO) in order to encourage the development of affordable housing going back to at least 2003, which was updated in 2007 and again in 2015..........Read More

Don't 'Kill' The Low Income Housing Tax Credit, Expand it

September 22, 2017                     By:  Jane Graff, Michael Bodaken, Patrick Sheridand & Terry Parker

Leaders of four of the largest affordable housing nonprofits make the case for the LIHTC.

In a recent op-ed published in The Wall Street Journal (“Kill the Loopholes, Including the One for Low-Income Housing”), authors Chris Edwards and Vanessa Brown Calder argue that the low-income housing tax credit, the most successful tool we have to create affordable housing, should be eliminated. This idea would have detrimental impacts for millions of people nationwide.

As the leaders of the country’s largest affordable housing nonprofits, we know that the housing credit is a critical incentive for private investment in housing that is affordable. Over the last 30 years, virtually all affordable rental housing in this country has been built or rehabilitated with housing credit support.

The housing credit should be expanded, not “killed.” Currently more than one in four renters pays more than half of their income on housing costs, and waiting lists for affordable housing are already years long—many aren’t even open to new applicants, the backlog is so enormous. Without building more affordable housing with the housing credit, these problems will only grow worse. Moreover, Matthew Desmond, in his Pulitzer Prize-winning book Evicted, demonstrates that housing stability is the gateway to breaking the cycle of poverty....................Read More

If Rent Were Affordable, the Average Household Would Save $6,200 a Year

September 20, 2017                     By: Tanvi Misra

A new analysis points to the benefits of ending the severe affordability crisis.

If renters paid just what they could afford in rent, the average household would have $6,200 a year more in their pocket to spend on groceries, childcare, medical care, and education—things one in five households have been skimping on to make rent. Collectively, that would amount to $124 billion that can help fuel economic growth.

A new apartment complex in North Dakota, advertising its vacancy. //Andrew Cullen/Reuters

These estimates of the 100 most populous U.S. cities come from a new analysis by the National Equity Atlas—a joint project by PolicyLink and the USC Program for Environmental and Regional Equity. “Renters are the lifeblood of cities,”Angela Glover Blackwell, CEO of PolicyLink, said in a statement. “If rents were affordable, renters could meet their basic needs like transportation, food, and child care and contribute even more to thriving communities. This would have a positive ripple effect throughout their regions.”.........................Read More

ULI report: Here are 5 ways states can create affordable housing

September 18, 2017                    By: AZRE

State governments, in partnership with cities and other local jurisdictions, can and should do more to promote housing development, affordable housing and choice through smarter local land use policies and incentives, according to a new Urban Land Institute (ULI) report, Yes in My Backyard.

Rising housing costs are creating hardships for millions of U.S. households and taking a toll on economic growth – a problem made worse by local zoning and land use regulations and development review processes that impede affordable housing development, the report explains. While municipalities have more autonomy in some states than others, states do have significant power to affect these regulations. However, the report notes, relatively few states have seized opportunities to deploy their authority and resources to help localities plan and accommodate housing development through land use and zoning policies......................Read More

Affordable Housing Developers Face New Challenges

September 19, 2017                     By: Bendix Anderson

The federal LIHTC program is providing less funding in 2017 than it did in prior years.

Affordable housing developers are facing more obstacles to building new projects, even though the need for affordable housing seems to grow stronger every year.

“We believe affordable housing production, that is, the development or preservation of projects financed with Low Income Housing Tax Credits (LIHTCs), will be at best flat to last year,” says Richard Gerwitz, co-head of Citi Community Capital, a community lending and investment arm of Citi.

The most important government program that helps fund new affordable housing—the federal LIHTC program—is providing less funding in 2017 than it did in prior years. At the same time, developers of all types have to pay more to compete for workers, construction materials and development sites. All that adds up to the likelihood that fewer units of affordable housing will start construction this year compared to 2016, even though the need for affordable housing may have never been greater, according to numerous studies and reports................Read More

Creativity Key To Affordable Housing Funds

September 18, 2017                       By: John Salustri

The affordable housing sector is in financial crisis.  And this year, it seems the crisis is becoming more chaotic. In the midst of chaos, creativity in the approach of funding is what you need.

NEW YORK CITY—Affordable housing is multifamily’s problem child, largely pushed aside by the bigger paydays of the luxury market, bureaucratic oversight and dwindling funds for construction. Relief from this chaotic condition lies largely in the hands of lawmakers, leaving it to the creativity of practitioners, the developers and the financial sources to fill the gaping holes in the system.

Rendering of Center\West in Baltimore

“The country is experiencing an unprecedented rise in renting,” says Al Beaumariage, KeyBank’s SVP and program manager for affordable housing. Since the current upswing began in about 2010, “the number of renter households has increased on average by 800,000 annually. So today, nearly 39 million people in the US, or one in eight, are calling apartments home.” Still, he adds, a mere 300,000 apartments are coming out of the ground annually, only 40,000 of which are affordable............Read More

Starrett City Sells For $850M, Donald Trump Stands to Profit

September 7, 2017                                  By: Matthew Rothstein

The largest affordable housing project in America has been sold, pending approval from the Department of Housing and Urban Development.

Starrett City, virtually an ecosystem unto itself between the East New York and Canarsie neighborhoods in Brooklyn, is under agreement for a sale to a joint venture of recently formed Brooksville Co. and Rockpoint Group for over $850M, the New York Times reports. The sale is expected to close in 2018.

The 145-acre Starrett City is home to a racially diverse mix of low, moderate and middle income families with 100% designated affordable units. The 46-building, 5,881-unit complex has its own ZIP code, school system and power plant. All told, it houses at least 15,000 residents.....................Read More

Even Affordable Rentals are too Expensive for Lowest Income Tier

By:    Suzanne De Vita                        August 29, 2017

Housing in major metropolitan areas is moving beyond the means of many, with renters, especially, burdened by rising rents and standstill wages. Affordability has become so strained, according to a recent analysis by Zillow, that even cheap rentals are out of reach for the very segment they’re priced for.

Researchers at Zillow assessed income data from the U.S. Census Bureau against rents, discovering that low-income renters in the 25 largest metropolitan areas are spending much more than what is recommended on rent, even in locations where rentals are priced inexpensively for the market.

The consequence, the research shows, is a lapse in savings that could be disastrous for renters already severely financially strapped. (In a separate analysis, Zillow projected homeless populations in metropolitan areas should rents rise 5 percent in 2017, with stark repercussions.) Roughly 70 percent of renters have not saved three months’ worth of living expenses..................Read More

Multifamily Industry Sees Continued Market Growth, Increased Affordability Challenges

September 6, 2017                         By: Christopher Spina - Freddie Mac

Freddie Mac Releases New Survey of Industry Participants

MCLEAN, VA--(Marketwired - Sep 6, 2017) - According to a new survey commissioned by Freddie Mac (OTCQB: FMCC), a significant majority of the multifamily industry believes the rental housing market will continue to grow, fueled by increasing demand and a growing population. At the same time, however, a plurality of participants is less optimistic about the outlook for affordable housing as compared to just one year ago.

Commissioned by Freddie Mac in partnership with the real estate media and intelligence firm Hanley Wood, the survey gauged the attitudes of industry participants in sectors such as property development; building and construction; property management; lending, financing and investing; and government and trade associations.

Specifically, the survey found that 60 percent of industry participants anticipate the multifamily housing market will grow over the next 3-5 years, while only about 15 percent see it slowing down. Of those who believe the industry will grow, nearly one-third cite supply and demand as the justification for this continued growth, while another 17 percent cite population growth...................Read More

This grim map shows all the places working-class Americans can't afford to live

September 5, 2017                               By: Shawn Langlois

For much of this country’s working class, the American Dream is dead. In case you didn’t already know that, cost-estimating website HowMuch.net created a grim map that tells the sad tale.

The Statue of Liberty stands in the foreground as Lower Manhattan is viewed at dusk.

In the chart below, each bubble represents a city. The color corresponds to the amount of money the average American family has left over at the end of the year after paying for their living costs, like housing, food and transportation. The darker the shade of red, the worse off you are. The greener, the better. The bubble size also fits a sliding scale.

There's a lot of red on that map..............Read More

Is Anybody Home at HUD?

August 22, 2017                                                          By: Alec MacGillis       

8:00 am

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This story is a collaboration between New York and ProPublica, an independent nonprofit newsroom.

In mid-May, Steve Preston, who served as the secretary of Housing and Urban Development in the final two years of the George W. Bush administration, organized a dinner at the Metropolitan Club in Washington, D.C., for the new chief of that department, Ben Carson, and five other former secretaries whose joint tenure stretched all the way back to Gerald Ford. It was an event with no recent precedent within the department, and it had the distinct feel of an intervention. HUD has long been something of an overlooked stepchild within the federal government. Founded in 1965 in a burst of Great Society resolve to confront the “urban crisis,” it has seen its manpower slide by more than half since the Reagan Revolution. (The HUD headquarters is now so eerily underpopulated that it can’t even support a cafeteria; it sits vacant on the first floor.) But HUD still serves a function that millions of low-income Americans depend on — it funds 3,300 public-housing authorities with 1.2 million units and also the Section 8 rental-voucher program, which serves more than 2 million families; it has subsidized tens of millions of mortgages via the Federal Housing Administration; and, through various block grants, it funds an array of community-uplift initiatives. It is the Ur–government agency, quietly seeking to address social problems in struggling areas that the private sector can’t or won’t solve, a mission that has become especially pressing amid a growing housing-affordability crisis in many major cities.

Despite its Democratic roots, Republican administrations have historically assumed stewardship over HUD with varying degrees of enthusiasm — among the department’s more notable secretaries were Republicans George Romney and Jack Kemp, the idiosyncratic champion of supply-side economics and inner-city renewal...............Read More