NCSHA Washington Report | October 18, 2024

Pundits of various stripes coined memorable, somewhat ominous phrases to describe the apparent transformations in American life that seemed to be unfolding with astonishing speed during the early months of the Covid pandemic. A batch of new reports sheds light on which changes actually took hold — and suggests housing affordability will play a large role in how they may evolve.

A Not-So-Great Migration. State-to-state moves increased in 2020 and 2021, almost certainly partly due to Covid, but they never amounted to the “great pandemic migration” some proclaimed. A new report from the Brookings Institution finds “there were few metro areas in which that movement significantly altered metropolitan population or income or represented a huge break from pre-pandemic norms… and the increased volume of migration that prevailed at the height of the pandemic in 2020 – 21 had already subsided by 2021 – 22.”

Brookings and other analysts agree though the pre-pandemic trend that saw states — and areas within states — with less expensive housing draw residents from more expensive places accelerated, and continues today. An example in the news this week: A Tulsa, OK, program that offers $10,000 to people who move to the city for at least a year is touted as saving participants $25,000 in housing costs and has “convinced extended family members to leave the sky-high rents and mortgages of the coasts behind.”

Urban Gloom But Not Doom (Yet). Major American cities are in much better shape today than many predicted they would be during the early-Covid period of widespread lockdowns, sharp crime spikes, and mass adoption of remote work. Twenty-five of the 26 largest downtowns have more residents today than just before the pandemic, and violent crime is down in most. The worst of pandemic-driven decline was “episodic and has shown signs of a reversal,” asserts a new report by Cushman & Wakefield.

Yet most large downtowns remain plagued by high rates of excess office space, the likely catalyst of an “urban doom loop” that may still play out in some. CBRE and other analysts see an urgent need for central cities to provide more housing, from office conversions, through zoning reforms, and with tax incentives. The Urban Land Institute reports: “Developers and policymakers are racing together to find ways to more efficiently convert vacant or outdated office buildings into attractive residential towers.”

A Revolution with Uncertain Residential Impact. Before the pandemic, just under six percent of Americans (nine million people) worked remotely full time. Today, nearly 14 percent (22 million) do — and more than half of all workers report working on a hybrid schedule. Early on, the “remote work revolution” was “mainly responsible for soaring home prices and rentals,” according to the Federal Reserve Bank of San Francisco, as urban white-collar workers sought refuge in more affordable suburbs and small towns.

The future may be different. A study by the Economic Innovation Group and several others concludes “that even though remote work has increased rents in the short-run, they are likely to decline going forward and in the long-run may end up lower than pre-pandemic.” Time will tell.

Stockton Williams | Executive Director

In This Issue

• NCSHA Outlines Key Priorities for 2025 Tax Legislation
• HUD Appoints Ventura, Others to Housing Counseling Federal Advisory Committee
• FHLBs Helped 65,000 Households Through Housing Programs in 2023, According to FHFA
• NCSHA in the News
• Looking Ahead

NCSHA Outlines Key Priorities for 2025 Tax Legislation
This week, NCSHA submitted recommendations to the House Ways and Means Committee’s Republican “Community Development Tax Team” preparing for anticipated 2025 tax legislation. NCSHA’s proposals focus on expanding affordable housing by enhancing the Housing Credit and Housing Bond programs, increasing their funding, and modernizing their rules. Key suggestions include exempting Mortgage Revenue Bonds and multifamily Housing Bonds from the Private Activity Bond cap for five years, raising Housing Credit authority by 50 percent, and improving the efficiency of existing bond authority. NCSHA also advocates for strengthening the Housing Credit, adjusting Mortgage Revenue Bond rules to better support home buyers, and enacting the Neighborhood Homes Tax Credit to encourage affordable homeownership. These recommendations align with various legislative efforts supported by NCSHA. In addition to submitting its own letter, NCSHA signed onto three coalition letters to the Community Development Tax Team: one from the ACTION Campaign in support of the Affordable Housing Credit Improvement Act; one with other organizations focused on housing preservation on Housing Credit qualified contracts and nonprofit right-of-first-refusal proposals; and one from a coalition of mortgage lending associations and consumer groups on the tax deduction for mortgage insurance premiums. For more information, see NCSHA’s blog.

HUD Appoints Ventura, Others to Housing Counseling Federal Advisory Committee
On Wednesday, the U.S. Department of Housing and Urban Development (HUD) announced the appointment of seven new members to its Housing Counseling Federal Advisory Committee, including Rhode Island Housing’s Chief Executive Officer and Executive Director, Carol Ventura. The committee advises HUD on how to better provide individuals and families with the knowledge they need to obtain, sustain, and improve their housing situation through HUD-approved housing counseling. Committee meetings are open to the public and provide a forum for housing counseling providers to directly engage with HUD’s Deputy Assistant Secretary for Housing Counseling on ways to improve the delivery of housing counseling services. The new members will begin their three-year terms in January 2025 and will join five members who have been re-appointed for additional three-year terms.

FHLBs Helped 65,000 Households Through Housing Programs in 2023, According to FHFA
The Federal Home Loan Banks (FHLBs) assisted 65,000 low- and moderate-income (LMI) households in 2023 through their affordable housing and community development programs, according to a report released yesterday by the Federal Housing Finance Agency (FHFA). According to FHFA, the banks contributed nearly $447 million to their Affordable Housing Programs (AHPs), a 67 percent increase over 2022. AHP funding helped to support housing opportunities for more than 33,000 LMI households, 17,000 of which were very low income. FHFA notes that, in aggregate, the FHLBs contributed 26 percent more to their AHPs than legally obligated. Housing Credit projects received nearly 43 percent of all AHP funding distributed last year, and projects funded through HOME received 21 percent.

NCSHA in the News
Building Industry Hawaii, 10.17.24, HHFDC Recognized for Rapid Response after Lahaina Wildfires
FOX Money, 10.16.24, Who qualifies as a first-time home buyer?
Hoodline, 10.7.24, OHCS Honored with National Awards for Efforts in Homelessness Prevention and Affordable Housing Preservation

Looking Ahead

Legislative and Regulatory Activities

• October 18 | Comments Due to NCSHA | FHA’s Revised Cyber Incident Reporting Requirements
• October 28 | Comments Due | Fannie Mae and Freddie Mac Affordable Housing Goals, 2025 – 2027
• October 30 | Comments Due via HUD Drafting Table | FHA’s Revised Cyber Incident Reporting Requirements
• November 1 | Comments Due to NCSHA | HUD Multifamily Asset Management and Project Servicing Handbook
• November 18 | Comments Due | HUD Multifamily Asset Management and Project Servicing Handbook

NCSHA, State HFA, and Industry Events

• October 21 – 22 | ProLink Technology Live 2024 | Virtual
  Jennifer Schwartz will speak at this event.
• October 23 – 25 | National Affordable Housing Management Association: Top Issues in Affordable Housing Conference | Washington, DC
  Jennifer Schwartz will speak at this event.
• November 13 | Maine Affordable Housing Coalition: 2024 Housing Policy Conference | Portland, ME
  Jennifer Schwartz will speak at this event.
• November 14 | Vermont Statewide Housing Conference | Burlington, VT
  Stockton Williams will speak at this event.
• November 15 | Women’s Affordable Housing Network Quarterly Policy Update | Virtual
  Jennifer Schwartz will speak at this event.
• November 21 – 22 | NAHB Mortgage Roundtable | New York, NY
  Stockton Williams will participate in this event.