Make plans to attend: NCSHA's Annual Conference & Showplace Learn more.

NCSHA Washington Report | December 5, 2025

Published on December 5, 2025

NCSHA Washington Report - 2025
Everyone in affordable homeownership finance should be paying attention to crypto.

Digital currencies, like Bitcoin and Ethereum, are already a significant source of mortgage demand. Researchers have determined that “cryptocurrency windfalls are often used to finance home purchases” and “ZIP codes with high crypto exposure in 2021 experienced the greatest subsequent increases in both mortgage and auto loan originations and balances.” A Redfin report a few years ago suggested nearly 12 percent of first-time home buyers funded at least part of their down payment by selling crypto.

(At the same time, home prices that push ownership out of reach for working-class renters may increasingly tempt them to “pursue high-risk, high-return strategies — such as investing in cryptocurrencies — as a last resort,” according to a fascinating new paper.)

Crypto may soon be an allowable source of borrower reserves to meet mortgage lenders’ risk assessments. Last summer Federal Housing Finance Agency Director Bill Pulte instructed Fannie Mae and Freddie Mac to “prepare their businesses to count cryptocurrency as an asset for a mortgage.” Senator Cynthia Lummis (R-WY) has introduced a bill to codify the concept and “prohibit the forcing of crypto assets into dollars,” as is generally required today. Senate Democrats have panned the idea.

While mortgage industry groups have been more receptive, with most calling for a go-slow approach and attention to clear regulatory guardrails, other opinions are all over the lot.

Skeptics share concerns like those expressed by banker and analyst Christopher Whalen, who says: “Cryptocurrencies like bitcoin that fluctuate in value are really not ‘assets’ under [generally accepted accounting principles] and the laws of most states. These are like poker chips and are properly seen as gaming instruments.”

For optimists like credit union executive Christy Soukhamneut, accounting for crypto in mortgage risk assessments “fosters inclusivity by accounting for the diverse ways individuals build wealth today, potentially enabling larger groups to access homeownership opportunities that were previously out of reach.”

The first major federal law related to crypto, the GENIUS Act, enacted over the summer, establishes a legal framework for stablecoins, which are a category of the currencies designed to be more stable by pegging to a less volatile asset, such as the dollar. A loophole in the law allows stablecoin exchanges to offer their customers a financial benefit akin to, and perhaps more attractive than, the interest depositors receive from banks.

Last month, bankers’ associations in a letter to the Treasury Department warned “if stablecoins are allowed to pay interest at the federal funds rate, deposit losses could reach 25.9%, eliminating approximately $1.5 trillion in lending capacity…While all banks are affected, community banks face the greatest strain.” Bank groups are also trying to block crypto companies from getting national bank licenses from the Office of the Comptroller of the Currency.

“To call this a trillion-dollar fight would be an understatement,” said Patrick McHenry, who was until recently chair of the House Financial Services Committee. He now works for a crypto firm.

Stockton-Williams-Washington-ReportStockton Williams | Executive Director

In This Issue

  • Financial Services Committee to Mark Up Housing Bill Later This Month; Holds Hearing on Housing Supply
    The House Financial Services Committee will consider comprehensive housing legislation December 16 and 17, Chairman French Hill (R-AR) announced during a committee hearing Wednesday. Hill said the committee’s efforts will focus on streamlining regulatory processes and fostering home building. Hill’s remarks came after the chairman rejected efforts to include the Senate-passed ROAD to Housing Act in the final version of the National Defense Authorization Act (NDAA), arguing that House Republicans did not support some of the ROAD to Housing Act’s provisions.

    Committee Ranking Member Maxine Waters (D-CA) said during the hearing she supports including the ROAD to Housing Act in the NDAA and was disappointed Hill was no longer negotiating on it. She added that she was encouraged Hill wants the committee to consider housing legislation and suggested they “go big” and consider proposals that make substantial federal investments in affordable housing programs.

    (Since the hearing, multiple news outlets have reported the White House supports including some ROAD to Housing Act changes in the NDAA and discussions among Hill, House leadership, and others are ongoing.)

    As part of the hearing, the committee “noticed” dozens of housing bills, an indication it is considering including them in the housing package it will consider later this month. Several NCSHA priorities were among the noticed bills, including the HOME Reform Act of 2025, which would reauthorize and reform the HOME program, and the Community Investment and Prosperity Act, which would lift the cap on banks’ public welfare investments, including Housing Credits and Housing Bonds, from 15 percent of capital to 20 percent.

    The hearing focused on possible solutions to the housing supply shortage. Hill, Waters, and many committee members from both parties expressed a desire for Congress to enact policies to address this issue, though they differed in their preferred policies. The witnesses were Kevin Sears, immediate past president of the National Association of Realtors; Julie Smith, chief administrative officer for The Bozzuto Group, who spoke on behalf of the National Multifamily Housing Council, National Apartment Association, and Real Estate Technology and Transformation Center; Tobias Peter of the American Enterprise Institute; and Nikitra Bailey of the National Fair Housing Alliance. In their written testimonies, both Sears and Smith expressed support for the Affordable Housing Credit Improvement Act; Sears’ testimony also stated support for the Neighborhood Homes Investment Act.

    HHS Releases LIHEAP Funds
    Last Friday, the Department of Health and Human Services released more than $3.7 billion to states, territories, and tribes through the Low-Income Home Energy Assistance Program (LIHEAP). The funding, delayed due to the government shutdown, will help low-income households heat and cool their homes. A LIHEAP grant is typically around $225 and is applied to back debts owed to the utility company to prevent lapses in a household’s power. A number of HFAs administer LIHEAP on behalf of their states; others are subgrantees or otherwise partner with their administrating agency. Here is the breakdown of funding levels for states and territories.

    HUD Extends Interpretation of ‘Federal Public Benefit’ to CPD, Homelessness Programs
    On November 26, for implementation purposes of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), the Department of Housing and Urban Development (HUD) published a notice in the Federal Register broadening its interpretation of the term ‘federal public benefit’ to include Community Planning and Development (CPD) and Homeless Assistance Programs. Programs newly considered federal public benefits under the notice include the HOME Investment Partnerships Program (HOME), HOME-ARP, National Housing Trust Fund, Community Development Block Grant (CDBG), CDBG-Disaster Recovery, Housing Opportunities for Persons with AIDS, Emergency Solutions Grant, Continuum of Care, Pathways to Removing Obstacles to Housing, and Preservation and Reinvestment Initiative for Community Enhancement. Previously, HUD’s interpretation of federal public benefit programs applied to public housing, Housing Choice Vouchers, and certain other HUD-assisted housing programs but not CPD and homelessness programs.

    Under PRWORA, aliens who are not “qualified” are not eligible to receive federal public benefits. Grantees administering these programs will be required to verify the immigration status of persons receiving assistance. The notice states HUD will undertake a review and revise guidance to determine the means by which grantees will be required to verify immigration status of participating households.

    States Sue HUD Over CoC NOFO
    A number of states recently filed suit against HUD to prevent the department from moving forward with a modified notice of funding opportunity (NOFO) for its Continuum of Care (CoC) grant program, which provides grants to various entities to assist people experiencing homelessness, survivors of domestic and sexual violence, and other vulnerable populations. Historically, a significant amount of CoC funding each year — typically between 80 – 90 percent of CoC resources — is allocated to renew existing programs or developments. The revised NOFO proposes to significantly reduce the amount of funding available for renewals, limiting renewals to no more than 30 percent of available funds, and shifting the remaining resources to new entrants to the program on a competitive basis, with preference given to proposals providing transitional housing.

    In addition, the revised NOFO institutes a number of new considerations for funding eligibility, including prohibitions or preferences against so-called housing-first models and permanent supportive housing in favor of treatment-first and temporary shelter initiatives. The suit, filed in U.S. District Court in Rhode Island, seeks to compel HUD to set aside the revised NOFO and reinstate the earlier CoC NOFO, which would renew most existing assistance without the new conditions.

    HUD Issues New Criminal Screening Guidance
    HUD recently sent a letter to public housing authorities (PHAs) and owners of affordable housing developments announcing the rescission of previous HUD guidance related to criminal record screenings which HUD maintains caused confusion about criminal record screening obligations. The letter also reminds PHAs and owners of the mandatory requirements and optional screening policies available to them, including for tenant screening upon initial intake, ongoing monitoring of households, and use of physical security features and contracted security services. The letter further directs PHAs and owners to publicly display the hotline for the HUD Office of Inspector General and to contact law enforcement in the event of emergency or criminal activity on HUD properties.

    FHFA Announces New Fannie Mae, Freddie Mac Conforming Loan Limits
    Last Tuesday, the Federal Housing Finance Agency (FHFA) announced the 2026 conforming loan limit values (CLLs) for mortgages Fannie Mae and Freddie Mac will acquire in calendar year 2026. In most of the United States, the 2026 CLL for one-unit properties will be $832,750, an increase of $26,250 from 2025. The new ceiling loan limit for one-unit properties in high-cost areas will be $1,249,125, which is 150 percent of $832,750. FHFA also published a list of 2026 conforming loan limits as well as a map showing the limits by county and county equivalent.

    Special statutory provisions establish different loan limits for Alaska, Hawaii, Guam, and the U.S. Virgin Islands. In these areas, the baseline loan limit and the ceiling loan limit for one-unit properties will be $1,249,125 and $1,873,675, respectively.

    Looking Ahead

    Legislative and Regulatory Activities

     

    NCSHA, State HFA, and Industry Events

Newsroom

HFA Communities

Connect with your HFA peers for best practices, advice, and solutions.

Join the Conversation

Upcoming Events

event

View Event

Membership

Login

Get NCSHA Updates

Stay informed about the issues, legislation, and regulations important to state HFAs.

Subscribe