|
Sponsored By:
House, Senate Bills Would Improve Housing Credit
Legislation focused on the Low-Income Housing Tax Credit (LIHTC) program has been introduced in Congress. The Senate bill, S.548, would expand the LIHTC by 50 percent and allow LIHTC communities to better serve both lower and higher income households. Both the Senate and the House bill, H.R.1661, would make several improvements to the LIHTC program. To read an analysis, click the Web Link below.
Sponsored By:
Industry Trends
"U.S. Losing Low-Rent Units"
"How Transit-Oriented Development Can Provide Affordable Housing"
Tax Issues and Tax Reform
"Tax Reform Uncertainty and the Low-Income Housing Tax Credit Market"
HUD-Related Activity
"National Housing Trust Fund: FY '17 Allocations, Minimum Wages, Supportive Housing, and LIHTCs"
State and Local Activities
"Mayor Landrieu to Insist on Affordable Units Ahead of New Incentive Policy Later This Year"
"Portland Unveils Affordable, Energy-Efficient Apartments"
Green Building
"Closing the Gap"
Association News
LeadingAge Launches “Save HUD 202” Campaign
Determining Income & Rent Limits in Tax Credit Properties
DUNS Numbers Required Beginning in December
NAHMA Releases 2017 Affordable 100 List
Become a Specialist in Housing Credit Management® (SHCM®) Company!
Upcoming Events
Sponsored By:
Industry Trends
U.S. Losing Low-Rent Units
Apartment Finance Today (06/16/2017) Kimura, Donna
The lower end of the U.S. rental housing market continues to experience erosion, according to the new State of the Nation's Housing report from Harvard University's Joint Center for Housing Studies. The study estimated modestly priced units available for less than $800 shrank by 261,000 between 2005 and 2015, with most of the loss occurring at the lowest rent levels. Meanwhile, the number of units renting for $2,000 or more climbed by 1.5 million. The mismatch of demand and supply is getting worse, with the number of low-income renters far outnumbering available affordable units. The report determined housing established under the low-income housing tax credit (LIHTC) is a source of worry, with the Trump administration's plan to slash corporate tax credits cooling investors' LIHTC demand. Furthermore, affordability limits on more than 500,000 LIHTC units will expire over the next 10 years. Enterprise Community Partners CEO Terri Ludwig says being intentional and committed about developing affordable housing will be essential to remedying the rental housing crisis in the coming years. "While the margins absolutely have been squeezed, [LIHTC is] still a very highly productive program, which is generating 100,000 units of either new or preserved affordable housing every year and also creating about 100,000 jobs in the same time," Ludwig stresses.
How Transit-Oriented Development Can Provide Affordable Housing
Tennessean (05/22/17) Fraser, James; Whitus, Anna; Gulsby, Seth; et al.
Nashville, Tenn., is growing by 100 new residents each day, spurring concerns over affordable housing and transportation. NashvilleNext is the city government's future development plan that addresses both these issues. The plan includes efforts to fund, build, retain, and preserve affordable housing. NashvilleNext also links affordable housing to public transportation development through programs like nMotion and WalknBike. Transit-Oriented Development, known as TOD, is an integral aspect of urban planning, but needs to be paired with affordable housing policies. Studies from across the country show that proximity to transit stations increases land and property values, which in turn decreases housing options for lower-income populations. As a result, TOD can cause gentrification that prices out moderate- and low-income families. There are several strategies for creating affordable, transportation-oriented housing. For instance, as new units appear along transportation lines, cities can prioritize access to Housing and Urban Development voucher holders. Housing authorities can also purchase new units and offer them to voucher holders themselves. Cities furthermore can encourage affordable housing near transportation lines through the low-income housing tax credit program. States allocating these funds locally can incentivize building units near transit lines in their application processes. Cities seeking to maintain affordable, transportation-oriented units over time can begin by amending federal HOME block grants, which require that units remain affordable for a period ranging from five to 20 years, but may increase in price after this period expires.
Tax Issues and Tax Reform
Tax Reform Uncertainty and the Low-Income Housing Tax Credit Market
Affordable Housing Finance (06/14/17) Coate, Brian
Lancaster Pollard's Brian Coate says the low-income housing tax credit (LIHTC) market has been fraught with uncertainty concerning tax reform since the election, with President Trump promising massive tax cuts for both businesses and individuals. "There has been no clear indication on what the corporate tax rate would change to, although it's been rumored to be between 15 percent and 25 percent," Coate notes. "Such a change would have a dramatic impact on LIHTC pricing, as a majority of credit buyers are large corporations. With lower taxes to pay, they would need less tax credits." Coate says the response to the LIHTC market uncertainty among developers has been mixed, with some adjusting rapidly while others struggled with the changes, and some states collaborating while others went at it alone. As the second half of the year proceeds, Coate says "those in the affordable housing industry are hoping that some of the hesitation that LIHTC investors displayed in the wake of the election subsides. At this point in the year, tax reform passing in 2017 seems more unlikely than it did in January. In addition, a recent article in Affordable Housing Finance indicated that many LIHTC investors are hopeful that investment activity will increase, although investors will likely remain more cautious than they were under the previous administration. Either way, developers should stay informed of what's going on at the housing agencies in their states as adjustments are likely to continue throughout the year."
HUD-Related Activity
National Housing Trust Fund: FY '17 Allocations, Minimum Wages, Supportive Housing, and LIHTCs
Novogradac (06/20/2017) Shelburne, Mark
Housing Trust Fund (HTF) allocations for fiscal year 2017 are substantially larger than last year, totaling $219 million. HTF is in a better position than other U.S. Department of Housing and Urban Development programs because it is not subject to appropriation, but the reality is it is not enough to address the problem of affordable housing. By law HTF beneficiaries must have incomes below the poverty line or 30 percent of the area median (whichever is greater), but it is possible for minimum wage earners to exceed HTF income limits. Also, without additional capital, most states' entire allocation is inadequate to build even a 24-unit property. One solution to the expense/revenue dilemma is to have a mix of targeting, where rents paid by higher-income households effectively subsidize the HTF apartments. Such an approach means additional funding sources, including the low-income housing tax credit (LIHTC). Combining HTF with LIHTCs has great promise, and would be even more effective upon enactment of the Affordable Housing Credit Improvement Act (AHCIA), which was introduced earlier this year. A crucial tool, HTF faces some implementation issues, but they can be overcome by careful planning and execution by program administrators.
State and Local Activities
Mayor Landrieu to Insist on Affordable Units Ahead of New Incentive Policy Later This Year
New Orleans Times-Picayune (06/13/17) Sayre, Katherine
The city of New Orleans is examining how it deals with real estate incentives for future residential projects. The mayor's office is working with consultants HR&A Advisors on a study of real estate development tax breaks and a wide range of other economic incentives. Mayor Mitch Landrieu plans to unveil a new economic incentive policy in about five months and will not support property tax breaks for new residential real estate projects that do not include reduced-rate units in the meantime, Rebecca Conwell, the administration's head of economic development, said during a recent New Orleans Industrial Development Board meeting. Projects will need to include a "permanent affordability" component -- typically considered at least 50 years -- or affordable housing for low-income and middle-income renters. In a letter to the board, Landrieu said the city wants "to evaluate our past and current practices for awarding incentives and to learn how we can align our current resources and tools for incentivizing public investment to achieve our economic, equity, housing and resilience goals citywide." The conversation about housing incentives emerged as the board considered a proposal to grant a so-called "payment in lieu of taxes" plan to a proposed development downtown.
Portland Unveils Affordable, Energy-Efficient Apartments
Portland Press Herald (Maine) (06/06/17)
The Portland Housing Authority and Avesta Housing have partnered to build an energy-efficient, 45-unit affordable apartment community in Portland, Maine. The four-story building includes nine market-rate units and 36 affordable units, which are rented to families earning between $23,000 and $49,000 a year. The ground floor will house a Head Start preschool program, Portland community policing, and Portland Housing Authority offices. The building, which has solar panels on the flat rooftop, is the first multifamily building in the city to be certified as a Passive House by the Passive House Institute U.S. As an energy-efficient Passive House, the building does not have a centralized heating system because it is highly insulated, airtight, and well-ventilated. The rooftop supports 167 solar electric panels, which supply energy to the first floor of the building. The $7.8 million project is the housing authority’s first new development in 45 years. It was partially funded by low-income tax housing tax credits from Boston Capital.
Green Building
Closing the Gap
Commercial Property Executive (04/20/17) Marsh, Amanda
Every day 2.2 million square feet are awarded LEED certification, but challenges to environmental sustainability remain, not the least of which is its declining novelty, according to FXFOWLE's Ilana Judah. "We have to convince clients that don't have requirements to pursue LEED that there's still value in doing so," Judah says. CBRE's David Pogue notes differentiation "often requires more cutting-edge activities, which require more risk." There are many challenges and opportunities in green technology's latest advances, with Hines' Gary Holtzer noting they "have led to major changes in the recruitment and training of on-site building personnel, who more than ever before are required to understand increasingly complex technologies and how they interact." Maastricht University and CBRE's 2016 National Green Building Adoption Index points to significant adoption of green building practices countered by a slowdown in the rate of green-designated buildings, perhaps reflecting "the fact that only a certain fraction of the building stock can obtain a sustainability or energy efficiency certification." Experts agree persuading the Class B property market to embrace sustainable practices is a tough challenge, with Judah saying all stakeholders would benefit from additional education. "Vendors and products need to define what they offer with great clarity, so owners and managers can understand what they're buying and how to create value," says New York University professor Stuart Brodsky.
Association News
LeadingAge Launches “Save HUD 202” Campaign
“Save HUD 202” is the name of LeadingAge’s new campaign to prevent cuts to the Department of Housing and Urban Development (HUD) 202 Housing for the Elderly program; maintain 100 percent funding for people served by affordable housing today; and expand funding to create new affordable housing for older adults. As many 202s have been financed or refinanced with tax credits, cuts to the program would be devastating. Anyone interested is invited to participate in LeadingAge’s Thunderclap and Rally on Capitol Hill on June 27 to show support in keeping this program funded. To read more about the yearlong campaign, click on the Web Link provided.
Determining Income & Rent Limits in Tax Credit Properties
Each year, HUD releases Fiscal Year Median Family Income Estimates and Income Limits. This year, due in part to the regulatory freeze and transition to a new administration, income limits were not released until April 14. At the same time, MTSP income limits used by Low-Income Housing Tax Credit properties and tax-exempt bond properties were also released. A useful tool for tax credit properties is the updated Novogradac Rent & Income Limit Calculator©. Click on the Web Link for more information.
DUNS Numbers Required Beginning in December
Via a series of regional office emails issued in late May, HUD announced plans to implement the requirement to include the Dun & Bradstreet’s (DB) Data Numbering System (DUNS) Numbers on all vouchers submitted to Tenant Rental Assistance Certification System (TRACS) starting Dec. 1. Vouchers that do not contain an active DUNS number will not receive payment until corrected. For more information, click the Web Link below.
NAHMA Releases 2017 Affordable 100 List
The National Affordable Housing Management Association (NAHMA) announces its 2017 Affordable 100—a list of the 100 largest affordable multifamily property management companies ranked by affordable unit counts—is available on its website, click Web Link below, as well as in the June issues of NAHMA News, Affordable Housing Finance magazine and Units magazine. The NAHMA website version expands the list to the top 120 largest multifamily property management companies. In addition, the online version presents two specialty lists: the 25 largest housing credit (LIHTC) property management companies and the 25 largest Rural Development program property management companies.
Become a Specialist in Housing Credit Management® (SHCM®) Company!
The three national associations sponsoring the Specialist in Housing Credit Management® (SHCM®) certification program invite your company to become a Specialist in Housing Credit Management® Company, a corporate designation created specifically to honor management companies that successfully maintain a significant portion of their properties and staff to the high standards of the SHCM certification program.
The SHCM program, developed especially for management companies involved with properties developed and operated under the Low-Income Tax Credit (LIHTC) program, is sponsored by the National Affordable Housing Management Association (NAHMA), the National Apartment Association Education Institute (NAAEI), and LeadingAge.
Earning the SHCM Company designation publicly demonstrates that a company is among the finest managers of LIHTC housing in the industry.
For more details on how to become a SHCM Company, click on the Web Link below.
Upcoming Events
NAA MAXIMIZE: Multifamily Asset Management Conference
October 2-4, 2017
More
NAHMA Regulatory Issues (Fall) Meeting
October 22-24, 2017
More
LeadingAge 2017 Annual Meeting & EXPO
October 29-November 1
More
Abstract News © Copyright 2017 INFORMATION, INC.
|
|
