Bold New Housing Plan?

photo by Cybershot800i

Wanderer Above the Sea of Fog by Caspar David Friedrich

Enterprise Community Partners has released An Investment in Opportunity: A Bold New Vision for Housing Policy in the U.S. I thought it would be useful to highlight its specific proposals to make rental housing affordable for low-income households:


  1. Improve the Section 8 program and expand regional mobility programs to help more families with rental assistance vouchers access high-opportunity neighborhoods 
  2. Establish state and local laws banning “source of income” discrimination by landlords and property owners 
  3. Balance the allocation of Low-Income Housing Tax Credits and other federal subsidies to both high-opportunity neighborhoods and low-income communities, while creating more opportunities for mixed-income developments 
  4. Establish inclusionary zoning rules at the state and local levels 
  5. Establish state and local regulations that encourage innovation and promote the cost-effective development of multifamily housing 
  6. Incorporate affordable housing considerations into local and regional transportation planning through equitable transit-oriented development


  1. Make the public and private investments necessary to preserve existing affordable housing while creating mixed-income communities 
  2. Build capacity of public, private and philanthropic organizations at the local level to pursue cross-sector solutions to the problems facing low-income communities 
  3. Create state and local land banks and other entities to return vacant and abandoned properties to productive use 
  4. Make permanent and significantly expand the New Markets Tax Credit 
  5. Create a new federal tax credit for private investments in community development financial institutions and other community development entities 
  6. Establish federal regulations that encourage “impact investments” in low-income communities by individual and institutional investors


  1.  Reform the Mortgage Interest Deduction and other federal homeownership subsidies to ensure that scarce resources are targeted to the families who are most in need of assistance 
  2. Gradually double annual allocations of Low-Income Housing Tax Credits and provide additional gap financing to support the expansion 
  3. Significantly expand funding to Section 8 vouchers to ensure that the most vulnerable households in the U.S. have access to some form of rental assistance 
  4. Expand funding to the Housing Trust Fund and the Capital Magnet Fund as part of any effort to reform America’s mortgage finance system 
  5. Break down funding silos to encourage public investments in healthy and affordable housing for recipients of Medicaid 
  6. Create permanent funding sources at the state and local level to support affordable housing


  1. Establish minimum wages at the federal, state and local levels that reflect the reasonable cost of living for each community 
  2. Expand the Earned Income Tax Credit, the Child Tax Credit and other essential income supports to America’s low-wage workers 
  3. Create a new federal fund to help test and scale innovative financial products that encourage low-income households to save, with a primary focus on unrestricted emergency savings 
  4. Help more low-income families build strong credit histories 
  5. Establish strong protections against predatory financial products

Not sure if I could really categorize this as “bold.” “Unrealistic” seems more apt in today’s political environment. Indeed, it reads like a wishlist drafted by a committee.

That being said, I think that Enterprise’s vision is helpful in a variety of ways. First, it offers a pretty comprehensive list of policies and programs that that can be used to  make housing more affordable. Second, it recognizes income inequality is a big part of the problem for low-income households. Third, it acknowledges that current federal housing policy favors wealthy households (cf. mortgage interest deduction) over the poor. Finally, it acknowledges that restrictive local land use policies inflate the cost of housing.

I wonder if a bolder plan would be just to fully fund Section 8 so that all low-income households were able to afford a safe and well-maintained home. Probably just as unrealistic as Enterprise’s vision, but it has the virtue of being simple to understand and execute.

Thursday’s Advocacy & Think Tank Round-Up

  • The Cornerstone Partnership has developed the Inclusionary Calculator, which “allows users to model a real or hypothetical housing development and then add affordable housing requirements in combination with different development incentives.”  The Antlantic Citilab has argued that this tool shows that affordable housing is not only feasible but also profitable, almost anywhere.  This fact, they argue, makes the decision on whether or not to develop real estate in an  inclusionary fashion a moral choice and not an economic one.
  • Congratulations to the Empire Community Loan Fund, one of the largest not-for-profit loan funds and Community Development Financial Institution (CDFI), which has been selected for inclusion in the Impact Assets 50 (IA50). The IA 50 is an annual showcase of Impact Investment Fund Managers.  The Empire Community Loan Fund issues debt instruments to support affordable housing development, among other things.
  • Harvard’s Joint Center for Housing Studies’ Remodeling Futures Program has released it’s Lead Indicator of Remodeling Activity (LIRA) for the Third Quarter of 2015 in which it predicts annual spending growth for home improvements will accelerate from 2.4% last quarter to 6.8% in the second quarter of 2016. The next LIRA release date is January 21, 2016.

Tuesday’s Regulatory & Legislative Round-Up

  • The U.S. Department of Housing and Urban Development (HUD) held a policy conference to commemorate the 50 year anniversary of the Fair Housing Act.  Among the conference materials is a report from the Government Accountability Office (GAO) which states the the Internal Revenue Service’s (IRS) oversight over compliance with the Low Income Housing Tax Credit Program (LIHTC) has been lax and proposes joint IRS/HUD oversight.  The NMTC has been used to create affordable housing through Housing finance Agencies (HFAs).  According to the GAO report the IRS has only conducted seven audits of the 56 HFA since 1986. The GAO report states, “Joint administration with HUD could better align program responsibilities with each agency’s mission and more efficiently address existing oversight challenges.”
  • The U.S. Treasury has awarded awarded $202 million dollars to 195 Community Development Financial Institutions (CDFIs) through the Community Development Financial Institutions Fund (CDFI Fund).  The CDFI Fund was established in 1994 to provide capital and access to credit in underserved communities through CDFIs. CDFIs are mission driven financial institutions which work on the local level to revitalize neighborhoods and create economic change.  The CDFI Program invests in and builds the capacity of community credit unions, banks, loan funds, and other financial institutions serving rural and urban communities.
  • The Seattle Mayor has proposed new legislation to build 6,000 new affordable housing units. The proposal has been dubbed a “grand bargain” between affordable housing advocates and real estate developers. This grand bargain will require all new development in Seattle pay for affordable housing creation.
  • Not to be outdone, the Mayor of Denver has also been mulling over a policy (mentioned in his inaugural address) which would tax new development and also raise the property taxes.  Both Seattle and Denver are reacting to a situation in which lower paid professionals including teachers, restaurant and healthcare workers are increasingly difficult to attract and recruit because they are unable to find housing they can afford.

Tuesday’s Regulatory & Legislative Update

  • The Federal Housing Administration (FHA) released a final notice, The Small Buildings Risk Sharing Initiative invites private sector lenders to partner with the FHA to provide long term fixed rate capital to small building owners with mortgages of $3 – 5 million. Lending under this initiative will be limited to properties which are willing to meet affordability requirements.  The FHA will guarantee 50% of the mortgages.  The FHA is also pursing a change to Section 542(b) of the Housing and Community Development Act of 1992  to allow SBRSI lenders to access capital through Ginnie Mae and to authorize securitization of the loans. In the mean time lenders can access low interest long term capital through the U.S. Treasury’s Federal Financing Bank.
  • The Mayor of Seattle has released an Action Plan to address the affordability crisis in that city, where 15-20% of the population is severely rent burdened and minorities are disproportionately impacted. The Mayor’s goal is to create 50,000 units over the next 10 years.
  • The U.S. Department of the Treasury has proposed a rule which, “provides for the enforcement of Title VI of the Civil Rights Act of 1964…to that end no person in the United States shall on the grounds of race, color, or national origin be denied participation in, be denied benefits of, or be otherwise subjected to discrimination under any program or activity that receives Federal financial assistance from the Department of the Treasury.”  The rule, open for comment until September 11, provides guidance to recipients and provisions for “consistent and appropriate enforcement.” The proposed ruled covers 12 programs including the Community Developments Financial Institutions Fund (CDFI).

Friday Government Report Roundup

Friday’s Government Report Roundup