Biden administration announced on Wednesday new plans to increase affordable housing in the United States amid a crisis that’s being exacerbated by COVID-19.
President Joe Biden’s administration said the new steps will create, preserve and make available nearly 100,000 additional affordable homes to buyers and renters over the next three years. The measures are focused on helping those in the lower- and middle-class.
The Administration is announcing a number of steps that will create, preserve, and sell to homeowners and non-profits nearly 100,000 additional affordable homes for homeowners and renters over the next three years, with an emphasis on the lower and middle segments of the market, the White House fact sheet said.
According to the fact sheet, Specifically, federal agencies will:
- Boost the supply of quality, affordable rental units by relaunching the partnership between the Department of Treasury’s (Treasury) Federal Financing Bank and the Department of Housing and Urban Development (HUD) Risk Sharing Program in order to enable eligible state housing finance agencies (HFAs) to provide low-cost capital for affordable housing development; raising Fannie Mae’s and Freddie Mac’s (the Enterprises) equity cap for the Low-Income Housing Tax Credit (LIHTC), the largest federal program for the construction and rehabilitation of affordable rental housing; and making more funding available to Community Development Finance Institutions (CDFIs) and non-profit housing groups for affordable housing production under the Capital Magnet Fund.
- Boost the supply of manufactured housing and 2-4 unit properties by expanding financing through Freddie Mac. Along with Fannie Mae’s and the Federal Housing Administration’s (FHA) existing policies, these steps will enable more Americans to purchase homes, and increase the availability of rental units throughout the country.
- Make more single-family homes available to individuals, families, and non-profit organizations – rather than large investors – by prioritizing homeownership and limiting the sale to large investors of certain FHA-insured and HUD-owned properties, in addition to expanding and creating exclusivity periods in which only governmental entities, owner occupants, and qualified non-profit organizations are able to bid on certain FHA-insured and government-owned properties.
- Work with state and local governments to boost housing supply by leveraging existing federal funds to spur local action, exploring federal levers to help states and local governments reduce exclusionary zoning, and launching learning and listening sessions with local leaders.
The measures include launching partnerships and financing through Freddie Mac and the Federal Housing Administration and a focus on selling federally-owned properties to individuals, families and non-profits, as opposed to investors.
One of the major goals is to increase the number of quality rental units.
“Even before the pandemic, 11 million families, or nearly a quarter of renters, paid more than half of their income on rent,” the White House said in a statement. “President Biden believes this is unacceptable. Rent should be affordable for working families.”
Officials said Biden’s agenda calls for construction and rehabilitation of more than 1 million affordable housing units and reducing the burden of rent on American families.
The White House said it would also prefer to see state and local governments create a better climate that promotes affordable homes.
Wednesday’s announcement came amid a housing crisis in the United States driven by a lack of available and affordable homes in some markets and exacerbated by COVID-19.
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