Weekly update from the National Housing Conference

In this issue


September 10, 2023

Issue 92-31


· AHCIA momentum grows with bipartisan sponsorship list - new local support letter circulating

· ICE completes Black Knight acquisition

· Hornung promoted to NEC Deputy Director

· Freddie Mac searches for fourth CEO in five years

· CDFI Fund updates NMTC eligibility

· HUD updates Fair Market Rents; allocates $113 million in Housing Choice Vouchers

· HUD PD&R announces Direct Rental Assistance pilot

· $256 million available in Choice Neighborhoods funding



Chart of the week: Goldman’s Housing Affordability Index hits record low

 

A pivotal time for housing and NHC


By David M. Dworkin, President and CEO


The next three months will be among the most important opportunities for affordable housing policy in years, and for at least a year to come. There is still a chance to pass desperately needed housing production legislation before the 2024 election is in full roar. There are also some critically important regulatory initiatives underway that will help contribute to improving the housing crisis – or make it worse.

 

These include enactment of the Affordable Housing Credit Improvement Act – estimated to result in the financing of nearly two million additional affordable homes over ten years; and the Neighborhood Homes Investment Act, which would provide tax credits in communities to close the “appraisal gap,” making undervalued projects feasible, and creating more inventory for entry-level homeownership. These bills have broad bipartisan support and are must pass legislation for housing.

 

There are also real threats to our work, including proposed capital standards that would add to the racial homeownership gap, proposed pricing changes that will hurt first-time homebuyers, and a proposed modernization of the Community Reinvestment Act that could disincentivize community development. We are hopeful that major changes will be made in these proposals, but they won’t be addressed if we don’t continue to advocate for them as a united coalition.

 

And that is where your involvement is so vital. NHC needs your active membership to maximize our contribution to your work and the work of our colleagues. To our current members, I thank you for your continued support of NHC. As we begin our membership drive, this is the perfect time to renew your membership for 2024.

 

And for those who are not currently members, please join today. Whether you are an individual, a nonprofit or for-profit organization, we have a membership level tailored to meet your specific needs. Our Emerging Leaders in Affordable Housing is designed for those 35 and under at just $50 a year, nonprofit memberships start at $1,000, and for-profit memberships start at $2,500, although we hope that you will consider joining our Leadership Circle to make a bigger difference.

 

By becoming a NHC member you can take advantage of exclusive networking opportunities, receive our weekly Member Brief containing the latest housing news and developments, and access to our Member Note which covers major economic developments and dialogues on today’s crucial housing matters. You also will get access to NHC’s research reports, like “Paycheck to Paycheck,” “Housing and Health,” and the “Employer-Assisted Housing Toolkit,” that provide information and insight to educate policymakers and housing leaders on emerging issues and best practices to address America’s diverse housing needs. To learn more about NHC’s member benefits and to join, click here.

 

We also have exciting events planned as we end the year. Our Solutions for Affordable Housing convening will take place on December 7, in-person and virtually, at the National Press Club. This event explores key national housing issues and the interplay between federal and local policies that shape them. And we look forward to seeing you in 2024 for our Solutions for Housing Communications convening on April 3 and at our Housing Visionary Awards Gala on June 5 at The Anthem in Washington, D.C.

 

By renewing or joining NHC now, your membership will encompass the remainder of 2023. And, if you join, renew, or elevate your membership by October 31, you will also receive additional benefits for the 2024 Housing Visionary Awards Gala. Platinum memberships will receive a complimentary half page ad in the Gala tribute book and a full-page digital ad to be displayed at the Anthem. Gold and silver memberships will receive a complimentary quarter page ad in the Gala tribute book and a quarter page digital ad to be displayed at The Anthem. Full memberships will receive a complimentary quarter page digital ad to be displayed at The Anthem. Learn more about these additional opportunities here.

 

Our work at NHC relies on the support of our members, both financially and intellectually, to represent your interests effectively. We look forward to collaborating with you over the coming year to address America’s affordable housing needs.

 
News from Washington | By Brittany Webb
 

AHCIA momentum grows with bipartisan sponsorship list - new local support letter circulating


With the support of over one-third of Congress, the Affordable Housing Credit Improvement Act (AHCIA) of 2023 continues gaining momentum. As of Sept. 5, 96 Republicans and 96 Democrats are cosponsoring the bill across both chambers. Enactment of the AHCIA is NHC’s top priority. The AHCIA would boost the construction of nearly two million new affordable housing units over ten years by expanding and improving the Low-Income Housing Tax Credit program.

 

"The extensive bipartisan support the Affordable Housing Credit Improvement Act has achieved in so short a time shows that members of Congress from across the ideological spectrum are ready to put aside their differences and work together to meet the housing needs of their constituents. The housing crisis impacts every state and district, spanning the red-blue divide, and the Housing Credit is the most important tool we have to bring private sector investment into desperately needed affordable housing," said the Steering Committee of the ACTION Campaign. "Despite the need, this essential program suffered a cut in resources in 2022 after an increase in Housing Credit authority expired. It's time to restore that cut, further expand this program's resources, and make common sense improvements to further strengthen this already successful program. We call on Congressional leaders to recognize the strong support for this legislation by passing it this year."

 

ACTION is circulating a local government leader sign-on letter to further build momentum around passing AHCIA in partnership with the National League of Cities, the National Association of Counties, and Mayors and CEOs for U.S. Housing Investment. The letter seeks support from mayors, county board chairs, and county executives. People can sign on to support until 5 PM ET on Sept. 15. 

 

ICE completes Black Knight acquisition


Intercontinental Exchange, Inc. (ICE), a global data and technology provider, completed its acquisition of Black Knight, a software, data, and analytics company that serves the housing finance continuum. Antitrust concerns stalled the $11.9 billion deal since its May 2022 announcement, but an agreement with the Federal Trade Commission (FTC) last month resolved those issues. The FTC had expressed concerns that the merger would drive up costs and reduce innovation from combining the two top mortgage technology providers. To satisfy the FTC's worries, ICE and Black Knight will complete the divestiture of Black Knight's loan origination system and product and pricing engine unit to a subsidiary of Constellation Software Inc. after the acquisition..


"Since our founding over twenty years ago, ICE has steadfastly adhered to our founding principle, demonstrated throughout our history, that applying technological innovation and digitization to traditionally analog businesses can make markets more efficient and transparent for all participants," said Jeffrey Sprecher, ICE founder, chair and chief executive officer. "Our team is well-positioned and ready to apply our proven playbook across the U.S. mortgage ecosystem to help improve the homeownership experience for millions of American families."

 

Hornung promoted to NEC Deputy Director


The National Economic Council (NEC) promoted Daniel Hornung to deputy director, the White House announced. Hornung will report to NEC Director Lael Brainard. Hornung's portfolio will focus on housing policy and economic strategy.

 

"Daniel has been a core member of the NEC from day one of this administration, providing expert analysis and execution on any topic thrown his way. Everyone at the White House has come to rely on Daniel as a go-to person on macro and housing," said Brainard. "We are delighted that he will continue to advance the president's economic agenda as a core leader of our team."

 

"Daniel didn't come to Washington as a houser, but he certainly is one now," said NHC President and CEO David Dworkin. "This promotion is an indication of his leadership in the housing sector and the priority that Dr. Brainard places on housing."

Freddie Mac searches for fourth CEO in five years


Freddie Mac’s Board of Directors announced that Michael DeVito, Freddie Mac’s CEO, will be leaving after less than three years on the job. DeVito was a highly respected mortgage industry veteran who spent 23 years at Wells Fargo Mortgage. He was preceded by David Brickman, who left after less than two years. The company has experienced significant turnover since the departure of Don Layton in 2019, who led the company through a turbulent seven years in the wake of the mortgage crisis which led to the company being placed into government conservatorship.


Freddie Mac is one of two government sponsored enterprises (Enterprises) that control 70% of the home mortgage market. Both were placed into conservatorship at the height of the 2008 financial crisis and have failed to emerge from supervisory management by their regulator, the Federal Housing Finance Agency (FHFA) and the U.S. Treasury Department. The Treasury Department owns warrants, akin to stock ownership, of 79.9 percent of both Enterprises.


In a brief prepared statement, FHFA Director Sandra Thompson said, "I am deeply grateful for his service and wish him well in his future endeavors.” Thompson said she “will work closely with the Board in identifying a successor and ensuring a smooth transition to the new leadership."

 

CDFI Fund updates NMTC eligibility


Treasury's Community Development Financial Institutions Fund (CDFI Fund) announced updated eligibility information for the New Markets Tax Credit (NMTC) Program. Treasury based the updated eligibility data on American Community Survey data from 2016-2020. The update is part of Treasury's efforts to use data sources that reflect current socioeconomic and demographic information.


The update made NMTC Low-Income Community Data available and ready for use as of Sept. 1, including an updated list of High Migration Rural Tracts. Island Area data that covers American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, and the U.S. Virgin Islands should be updated in Dec. You can find more information on the data transition in this FAQ document.  

 

HUD updates Fair Market Rents; allocates $113 million in Housing Choice Vouchers


HUD published the new Fair Market Rents (FMRs) for Fiscal Year 2024, which helps to determine the maximum amount a Housing Choice Voucher will cover. Nationally, FMRs will increase by an average of approximately 12%. Accompanying this announcement, the Office of Public and Indian Housing released $113 million in additional funding for Housing Choice Vouchers for 118 high-performing public agencies across 36 states. HUD estimates the money will assist 9,500 families.


"This year, HUD found that rents rose once again, accentuating the strain on costs for American families. These updated Fair Market Rents and our funding will ensure households can utilize vouchers in a competitive rental market," said HUD Secretary Marcia Fudge.


HUD also approved requests from the Housing Authority of the City of Los Angeles and the Los Angeles County Development Authority to modify Housing Choice Voucher requirements to expedite the existing verification process. The approved waiver allows Los Angeles housing authorities to adjust the income verification process within 60 days of issuing the voucher. The move modifies the prior requirement that income must be verified before the agency may issue a voucher.


"In light of the extraordinary crisis of homelessness that exists in Los Angeles, HUD is allowing the Los Angeles housing authority to modify a rule that too often delays people's access to the assistance they need to move from the streets or temporary housing into healthy, stable, affordable homes," said HUD Secretary Fudge. 

HUD PD&R announces Direct Rental Assistance pilot


HUD’s Office of Public Development and Research (PD&R) announced it is looking to partner with a broad spectrum of stakeholders, including philanthropy, guaranteed income advocacy groups, tenant advocates, and the private sector, in a Direct Rental Assistance pilot study to learn whether the Housing Choice Voucher (HCV) program could be improved by providing housing subsidies directly to eligible renters rather than to their landlords. Despite the benefits offered to assisted households, voucher holders face increasing challenges in finding affordable rental units due to source of income discrimination, lack of landlord participation in the HCV program, and tight rental markets. Such issues have led industry groups, tenant advocates, and elected officials alike to call for reform of the HCV program.


Building from the experience of other guaranteed income pilots across the country, HUD’s pilot would allow households to receive a traditional voucher funded by HUD or a monthly payment for the equivalent value funded by a philanthropy organization. This pilot would run for several years across various housing markets to allow HUD to compare success rates and other outcomes between households receiving vouchers and households utilizing direct cash subsidies. To learn more about the pilot, please reach out to Aaron Shroyer at Aaron.m.shroyer@hud.gov.

 

$256 million available in Choice Neighborhoods funding


HUD announced $256 million in funding for Choice Neighborhoods Implementation (CNI) Grants. CNI Grants primarily fund the redevelopment of severely distressed HUD properties into a mixed-income community. Since the program’s inception, the Choice Neighborhoods program has completed 13,000 new mixed-income units built across 52 cities with more than 37,000 units planned. Those eligible to apply include public housing authorities, local governments, and tribal entities. Awards go up to $50 million and are powerful tools for communities to revitalize neighborhoods. This funding announcement follows HUD's $370 million award to eight awardees who will collectively invest $3 billion in distressed neighborhoods and create over 5,000 new housing units. The application for implementation grants closes on Dec. 11. You can find the Notice of Funding Opportunity here.  

 
Chart of the week

Goldman’s Housing Affordability Index hits record low


The Goldman Sachs Housing Affordability Index reached a new record low in August as incomes fail to keep pace with rising interest rates and home value appreciation. The Index, which was created 25 years ago, is based on household income, home prices, and mortgage rates. The data caused Goldman analysts to change their forecasts of falling home prices at the end of this year to an increase of 1.8%, with predicted mortgage rate decreases in 2024 that may somewhat stabilize affordability. 

What we're reading

Community Solutions reported that Detroit has reduced veteran homelessness by 47% over the course of three years, a significant difference from the national reduction of 11%. The city saw success by reducing the inflow of homeless persons and ensuring that veterans currently experiencing homelessness were promptly connected to support systems by utilizing strong partnerships and a single coordinated system to assist veterans.

 

The New York Times published an article examining a housing development in Montgomery County, Md., that functions similarly to public housing by marrying public and private subsidies. The property, called The Laureate, is the first building financed with $100 million from a County fund created to speed development and have the local Housing Opportunities Commission invest directly into projects and trade profit for lower rents. The County hopes that taking a direct role in expanding housing will help to creatively finance future projects.

 

A new paper from X-Caliber Capital called “Converting Underperforming Offices & Hotels Into Multifamily Communities” examines adaptive reuse as an option for using the estimated 50% of offices unoccupied after the pandemic. The paper offers three core trends: remote working changing the view of traditional office environments, maturing loans and refinance challenges in a tough market, and travel and select hospitality taking a back seat while short-term rentals emerge as a new focus. 

The week ahead

Monday, September 11

Compliance and Risk Management Conference (Mortgage Bankers Association), in person in Washington, DC

IMB Network Webinar (Mortgage Bankers Association), 11:30 AM - 12:30 PM ET

Commercial Real Estate Basics: Borrower Mortgage Credit and Financial Statement Analysis (Mortgage Bankers Association), 1 - 2:30 PM ET

Housing First (NLIHC), 2:30 PM ET

 

Tuesday, September 12

Compliance and Risk Management Conference (Mortgage Bankers Association), in person in Washington, DC

HUD Office of Housing Counseling 2023 Community Conference (HUD Exchange)

NAR Sustainability Summit (National Association of REALTORS®), in-person in Austin, TX

Novogradac Online LIHTC Property Compliance Workshop (Novogradac), 12 - 4 PM ET

NHFTA Litigating Fair Housing Cases - September 2023 (HUD Exchange), 1 - 4 PM ET

Optimizing Technology in the Origination Process (Mortgage Bankers Association), 1 - 2 PM ET

Preservation Next Colorado Academy: Policy and its Impacts on Preservation and Housing Stability (Enterprise Community Partners), 1 - 2:30 PM ET

Section 3 and Labor Standards: Job Opportunities for Low-Income Persons (NAHRO), 1 - 4 PM ET

ABA Fall Advocacy Outlook Webinar (American Bankers Association), 2 - 3 PM ET

Agency Roundtable on Special Purpose Credit Programs (HUD, OCC, FHFA, CFPB), 3 PM ET

 

Wednesday, September 13

Compliance and Risk Management Conference (Mortgage Bankers Association), in person in Washington, DC

HUD Office of Housing Counseling 2023 Community Conference (HUD Exchange)

NAR Sustainability Summit (National Association of REALTORS®), in-person in Austin, TX

Novogradac Online LIHTC Property Compliance Workshop (Novogradac), 12 - 4 PM ET

Rural Rental Housing Preservation Academy: Funding Beyond USDA RD: LIHTC, Bonds and Third Party Leaders Connecting Buyers and Sellers (Enterprise Community Partners), 10 AM - 5 PM ET, in person in Salt Lake City, UT

Building the 15-Minute Community: Leadership Strategies in Real Estate and Infrastructure (ULI Americas), 1 - 2:30 PM ET

Managing CPF Grants: Foundations for a Successful Program Webinar Series: A Practical Guide for Costs and Addressing Indirect Cost Rates (HUD Exchange), 1 - 2:15 PM ET

Our Places of Impact: Introduction to Systems Change for Community-Led Initiatives (HUD Exchange), 1 - 2 PM ET

Section 1071: A Practical Approach to Unpacking the CFPB’s Final Rule (Mortgage Bankers Association), 1 - 2 PM ET

Budgeting and Financial Planning for Non-Believers (Mortgage Bankers Association), 2 - 3:30 PM ET

A Community-Centered Approach to Advancing Park Policy - A 10-Minute Walk Park Equity Roundtable (NextCity), 2 - 3 PM ET

DHRC’s Disaster Recovery Working Group (NLIHC), 2 PM ET

HOPWA Regulations for Termination of Assistance Webinar (HUD Exchange), 3 - 4:30 PM ET

 

Thursday, September 14

HUD Office of Housing Counseling 2023 Community Conference (HUD Exchange)

Novogradac Online LIHTC Property Compliance Workshop (Novogradac), 12 - 4 PM ET

WHF/WHFF Partner Series: Flood Mitigation - Why We Are Failing (Women in Housing and Finance), 12 - 1 PM ET

CDBG-CV Problem Solving Clinics - September 2023 (HUD Exchange), 12:30 - 5:30 PM ET

NHFTA Litigating Fair Housing Cases - September 2023 (HUD Exchange), 1 - 4 PM ET

Preservation Next: Developing a Financial Stability and Business Plan (Enterprise Community Partners), 1 - 4 PM ET

Value of Surveillance in Managing CRE Credit Risk (Mortgage Bankers Association), 2 - 3 PM ET

 

Friday, September 15

Cities and Severe Mental Illness: The Challenge in New York City and Los Angeles (American Enterprise Institute), 10 AM - 12 PM ET

Updates on the State of the Nation’s Housing 2023 (Harvard JCHS), 1 - 2 PM ET

COVID-19 Planning & Response for Homeless Assistance Providers Office Hours (HUD Exchange), 2:30 - 4 PM ET

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