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Weekly update from the National Housing Conference
News from Washington | By Luke Villalobos
Manchin sets $1.5 trillion spending limit on reconciliation package

Sen. Joe Manchin (D-W.V.) announced Thursday that he would not support a reconciliation bill that spends more than $1.5 trillion, a limit less than half the amount that would be spent under President Biden’s $3.5 trillion proposal. That number is consistent with what Manchin proposed to Senate Majority Leader Chuck Schumer (D-N.Y.) in July, according to a memo obtained by Politico. The memo also indicated that Manchin would not support opening debate on a bill earlier than Oct. 1.

It was not immediately clear how Biden’s proposal, which includes $330 billion in new spending on housing, would be downsized to accommodate Manchin’s limit. Complicating matters is the fact that Sen. Kyrsten Sinema (D-Ariz.), the other Democratic holdout on the reconciliation bill, has not settled on what amount of spending she could support. Without the support of both Manchin and Sinema, Democrats will not have the votes to pass a reconciliation bill.

On Thursday, NHC and 21 other housing organizations sent a letter to Democratic leadership urging them not to reduce funding levels for the Neighborhood Homes Investment Act and Affordable Housing Credit Improvement Act. The letter noted that these measures alone would create 1.9 million of the 2 million homes President Biden has committed to building to ameliorate the national housing crisis.
Senators introduce Downpayment Toward Equity Act

A group of senators led by Raphael Warnock (D-Ga.) introduced the Downpayment Toward Equity Act on Thursday, the Senate version of downpayment assistance legislation that has been pushed in the House of Representatives by House Financial Services Committee Chair Maxine Waters (D-Calif.). The bill provides $100 billion for a new federal downpayment assistance program. It would provide up to $20,000 in downpayment assistance for first-generation homebuyers. It also directs HUD and the Department of Justice to conduct a compelling interest study to determine whether the program could be used to correct the historical denial of homeownership opportunities to members of socially disadvantaged groups. Upon completing that study, members of such groups would be eligible for $5,000 in additional downpayment assistance.

The bill is co-sponsored by Sens. Tim Kaine (D-Va.), Chris Van Hollen (D-Md.), Mark Warner (D-Va.), Elizabeth Warren (D-Mass.), as well as Senate Banking Committee Chair Sherrod Brown (D-Ohio). NHC has also endorsed the legislation, with NHC President and CEO saying, “in concert with other proposals to expand housing opportunities, this bill will go a long way toward ensuring that American families are not locked out of wealth-building due to the circumstances of their birth. It should be funded at the highest possible level.”
FHA adds new COVID-19 forbearance measures

The Federal Housing Administration (FHA) announced additional measures to protect government-backed homeowners on Monday as the COVID-19 pandemic continues to cause economic uncertainty.

FHA will offer six months of COVID-19 forbearance or a six-month home equity conversion mortgage (HECM) extension to homeowners who experienced financial difficulty due to the pandemic after Oct. 1. Homeowners have an option to extend that relief for an additional six months if their forbearance or HECM extension expires before the end of the COVID-19 National Emergency.

FHA will also offer six months of additional COVID-19 forbearance or a six-month HECM extension to homeowners who requested relief between July 1 and Sept. 30. Homeowners who requested relief between those dates are now eligible for a total of 12 months of relief, the same as borrowers who requested relief beginning in October of last year. That compares with 18 months of relief for homeowners who requested help between March 1 and June 30 of last year and 15 months for those who requested relief between July 1 and Sept. 30 of last year.
HUD announces disaster relief for southern Vermont

HUD announced that it would offer disaster relief to southern Vermont residents living in areas affected by severe storms that caused more than $5 million in damage in Bennington and Windham counties.

Measures aimed at individual households include offering foreclosure relief and mortgage insurance to government-backed borrowers and offering 203(k) funding available for those whose homes were damaged by the storms, and ramping up housing counseling and anti-discrimination efforts in the area. HUD also offered flexibility to local governments and housing authorities whose administrative capacity may have been impacted by the storms.
HUD announces 2,000th Section 108 loan

HUD announced on Tuesday that it had made its 2,000th loan under its Section 108 program. The $5 million loan to Springfield, Massachusetts, was to purchase and rehabilitate dilapidated properties.

Under Section 108, which was created by the 1974 Housing and Community Development Act, HUD loans localities up to 5 times the value of their Community Development Block Grant (CDBG) for large-scale community redevelopment projects. Section 108 loans have financed over 1,000 community redevelopment or infrastructure projects, which HUD estimates have contributed to creating over 120,000 jobs.
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Senate confirms Chopra as CFPB director

The Senate voted 50-48 on Thursday to confirm Rohit Chopra as the next director of the Consumer Financial Bureau (CFPB). The vote, which fell along party lines, comes after months of uncertainty for Chopra’s nomination after Republicans expressed skepticism of the nominee, calling him "anti-business".

Chopra most recently served as a member of the Federal Trade Commission but has a long history with CFPB. He worked closely with Sen. Elizabeth Warren (D-Mass.) to establish the agency following the Great Recession and joined the agency in 2011 to lead investigations into student loan misconduct. He is widely expected to ramp up enforcement of federal consumer protection laws that had fallen by the wayside under the agency’s previous director, Kathy Kraninger.
Chart of the week
Chart of the week: Saving up for a 3% downpayment takes longest in the Northeast, Rocky Mountains and West Coast

Data from Freddie Mac presented at the recent NHC and Homeownership Alliance convening on the Enterprises’ role in providing for affordable homeownership shows wide regional variation in how long it takes families to save up for a 3% downpayment. Building up enough in savings takes longer in urban areas in the Northeast, Rocky Mountains, and West Coast than in the South or Midwest for all racial groups, though Black and Hispanic families face greater difficulties in saving nationwide. View all the convening’s presentations and panels here.
What we're reading
The Washington Post reports that the feared “eviction tsunami” has not materialized in the weeks since the Supreme Court struck down the federal eviction moratorium. The article notes that experts are not celebrating yet, saying that evictions may occur more slowly and that many renters are “self-evicting.” It also asserts that the Supreme Court ruling has not materially affected the number of evictions because so many landlords violated the ban while it was in effect.
An article in Works in Progress makes the argument for the “housing theory of everything” – the idea that problems from stalling productivity to inequality to obesity are either driven in or made worse by the failure to build enough homes to keep up with demand. “If we’re right about this,” the authors conclude, “it means that fixing this one problem could make everyone’s lives much better than almost anyone realizes – not just by making houses cheaper, but giving people better jobs, a better quality of life, more cohesive communities, bigger families and healthier lives.”

The American Enterprise Institute published an updated analysis of the regions with the highest delinquencies for FHA mortgages based on August data. The Atlanta metropolitan area remains the region with the highest number of delinquent loans, with nearly 37,000 delinquencies as of August. Meanwhile, the region with the greatest share of delinquent loans is the Nassau County-Suffolk County metropolitan area in New York, where nearly one in five loans were delinquent.
The week ahead
Monday, October 4
Tuesday, October 5
NAHRO: Ethics for specialists, 1:30 – 4 p.m. ET
Wednesday, October 6
Thursday, October 7
Friday, October 8
The National Housing Conference is a diverse continuum of affordable housing stakeholders that convene and collaborate through dialogue, advocacy, research, and education, to develop equitable solutions that serve our common interest.
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