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SHCM Webinar: Update on Trends in Tax Credit
Join the experts in December to learn about the emerging trends in tax credits. The webinar will provide 1.5 hours of instruction with a minimum 30-minute question-and-answer session. Watch your email for more details.
It is free to current SHCM-certified professionals and $149 for non-SHCM professionals. Be sure that you renewed your SHCM credential in 2022 to participate in this webinar free of charge.
If you have questions about your renewal, please contact Leslie Marie O’Donnell of NAHMA at lodonnell@nahma.org. For registration questions, please contact Sara Keene at NAAEI at skeene@naahq.org.
To renew Your SHCM, click on the Web Link below.
Industry Trends
"How Affordable Housing Fared in the Midterm Elections"
"Affordable Housing Construction Costs Outpacing Tax Credits"
Congress
"Lawmakers, Advocates Eye Year-end Bills for Housing Credit"
"Benefits of the Inflation Reduction Act for Affordable Housing"
Green Building
"GSA, DOE Look to the Private Sector for Green Building Tech"
"The Next Innovation in Multifamily"
Association News
Making Affordable Housing Pencil Out
Update on the Biden Administration’s Housing Supply Action Plan
Bridging the Gap: NestQuest’s Innovative Approach to Section 8
Affordability Watch Q2 2022
Registration Open for NAA’s Apartmentalize Conference
NAHMA Releases 2022 Affordable 100 List
Become a Specialist in Housing Credit Management® (SHCM®) Company!
Upcoming Events
Industry Trends
How Affordable Housing Fared in the Midterm Elections
Affordable Housing Finance (11/10/22)
Affordable housing advocates say the midterm elections appear to have gone well for housing, said David Gasson, also a partner at MG Housing Strategies. “In short, I am still optimistic about an end-of-year omnibus budget and the potential for a tax package that could include some of our Low-Income Housing Tax Credit (LIHTC) priorities. With slim majorities in both houses, it is likely leadership on both sides of the aisle will want to begin the 118th Congress with a clean slate, or as clean as possible.” There is a real possibility of a productive lame duck session of Congress that results in bipartisan legislation on government spending and potentially tax items, added Emily Cadik, CEO of the Affordable Housing Tax Credit Coalition. “This could serve as a vehicle for proposals to increase affordable housing production, like restoring and expanding on the expired 12.5% LIHTC allocation increase, and lowering the 50% bond financing test,” she said. “The next few weeks will be critical for affordable housing advocacy.”
Affordable Housing Construction Costs Outpacing Tax Credits
Planetizen (10/26/2022) Ionescu, Diana
Affordable housing developers in Cincinnati are warning that reduced federal Low-Income Housing Tax Credits (LIHTCs) will have a negative impact on the construction of affordable units. The funding shortage coincides with rising rents and a growing need for affordable housing. Studies suggest Cincinnati needs about 30,000 more units of housing affordable to its lowest-income residents. Affordable housing developers say “as labor costs, materials and interest rates get more costly, that state-administered pool of federal money builders can apply for isn't keeping up.” And while Congress passed a 12.5% increase to LIHTC programs in 2018, that increase expired this year, reducing tax credits for affordable housing once again. Help could come from proposed federal and state legislation. If passed, the federal Affordable Housing Credit Improvement Act could finance as many as 1 million new affordable units in the next decade. Housing developers say current efforts are encouraging, but not sufficient. According to Urban Sites Vice President for Affordable Housing Tim Westrich, “Barring some big unforeseen change, there will be fewer affordable housing units in the future.”
Congress
Lawmakers, Advocates Eye Year-end Bills for Housing Credit
Roll Call (10/25/22) Reilly, Caitlin
Lawmakers and advocates are eyeing year-end legislation as vehicles to expand a low-income housing construction incentive as opportunities dwindle to address a growing affordability crisis before the next Congress. Despite bipartisan support for the Low-Income Housing Tax Credit (LIHTC), its expansion in a year-end bill may come down to cost and negotiations around other partisan priorities. Supporters see year-end tax and appropriations bills as the last, best chance to take action on housing in this Congress. House Ways and Means Chairman Richard Neal (D-Mass.), said he would like to see the program included in a year-end tax extenders package. The LIHTC, unlike many items in the package, isn't expiring. The issue is whether a temporary increase in the credit, already expired, can be extended or further expanded. “But for that credit, there's a lot of housing that doesn't get built at a time when the housing crunch is substantial across the country. I think it's a pretty important tax vehicle,” he said in an interview. “It's demonstrated its value time and again.” The incentive has bipartisan support but is more popular among Democrats than Republicans. Rep. Kevin Brady (R-Texas), the Ways and Means ranking member, said the committee will consider the housing credit for a year-end package. “There's challenges with the program, I've always thought,” he said in an interview. “For me, it doesn't fall in the highest priority of buckets.” Supporters of LIHTC say it could subsidize construction of affordable units, ameliorating the problem.
Benefits of the Inflation Reduction Act for Affordable Housing
Novogradac (11/02/2022) Parker, Brent
The Inflation Reduction Act (IRA) legislation advances renewable energy efforts well beyond what was previously possible with respect to affordable housing. The measure provides $369 billion in clean and renewable energy provisions that feature extensions and revisions to the renewable energy production tax credit and investment tax credit (ITC) and the new energy efficient home credit. The IRA allocates much of the $369 billion to various housing and low-income community oriented initiatives, including expanding and revising existing renewable energy tax credit incentives, in part to target housing in low-income communities by allocating $1 billion to grants and loans for improving climate resilience and energy and water efficiency in HUD-assisted multifamily housing, allocating $9 billion to the U.S. Department of Energy consumer home energy rebate programs for energy efficiency and electrification retrofits focused on low-income consumers. Importantly, the IRA creates bonuses or add-on credits that can potentially push the ITC up to 70%. The add-ons include a 20% credit for multifamily developments financed by the Low-Income Housing Tax Credit and other federal housing programs or a 10% bonus if the development is in a low-income community, as defined by the New Markets Tax Credit program. There is an annual cap for these two add-ons of 1.8 gigawatts, which will be determined in further guidance from Treasury.
Green Building
GSA, DOE Look to the Private Sector for Green Building Tech
FCW (10/11/22) Riotta, Chris
The federal government is seeking information on emerging technologies to help transition commercial buildings traditionally powered by fossil fuels to net-zero carbon emissions as part of its efforts to achieve economy-wide net zero emissions by 2050. General Services Administration and the Department of Energy released a request for information on Oct. 5 seeking input from the private sector on innovative solutions, emerging technologies and equitable methods to reduce energy consumption and carbon emissions for all commercial buildings. The RFI seeks information on how any proposed solutions can be applicable for wide-scale deployment across commercial buildings, and requests the proposed solutions to include integrated building controls, cybersecure components, and emerging, innovative technologies to help power buildings across the country. GSA and DOE said the government is also interested in technologies that can provide solutions to retrofit buildings to minimize heat transfer and air leakage, as well as control software for building integration and other next-generation technologies to aid in carbon reduction efforts.
The Next Innovation in Multifamily
Buildings (10/01/22) Morton, Jennie
Multifamily properties that are eco-friendly are attractive to both renters and developers. Some developers turn to Passive House certification, which focuses on measurable energy efficiency and carbon neutrality. Priority is given to such things as envelope tightness, window glazing, all-electrical systems, and heat- and moisture-recovery ventilation. Dr. Ganesan Visvabharathy, founder of Hawthorne Development Corporation, says, "Both the owners and developers need to understand that achieving stringent energy and carbon principles like Passive House need not be a daunting challenge. It's just a matter of putting together the right design team. The cost is also not much more than traditional construction, and you make up the investment many times over with a higher net operating income." The largest Passive House project in the state of Washington is Solis in Seattle, which has achieved a 50% energy savings over a national baseline. The cost was only a 5% premium absorbed by the development's market rate. Emily Doe, senior associate for Weber Thompson, says, "It's an exercise in being meticulous about the air barrier during the construction process...But this attention to detail allowed us to far exceed Washington's whole building pressurization test of 0.25 cfm—Solis is at 0.06 cfm per square foot." By placing the elevator and stairwell on the exterior, the stack pressure is bypassed. A weather-resistant barrier with self-healing properties was also employed. The triple window glazing has a low solar gain coefficient.
Association News
Making Affordable Housing Pencil Out
The firms struggling to make affordable pencil out recognize the goal goes beyond a typical real estate deal. The need for more affordable housing is a constant refrain in the rental housing industry. The remedies include build-to-rent communities, inclusionary zoning, up-zoning, mixed-income housing, ADUs and tinkering with tax credits.
For more information, click on the Web Link.
Update on the Biden Administration’s Housing Supply Action Plan
While there is forward momentum in achieving the five-year plan to ease the burden of housing costs, the Biden administration is also urging Congress to support the construction and preservation of affordable housing this year. Specifically, the administration urges Congress to expand rental assistance, assist aspiring homeowners with down payment assistance, and help create a more equitable housing market.
For more information, click on the Web Link.
Bridging the Gap: NestQuest’s Innovative Approach to Section 8
In Houston, one organization is finding ways to change the future of apartment living—one family at a time. The foundation of the organization is to provide children with housing and educational stability that they would typically not have access to. NestQuest has never had an eviction, and every child has graduated to the next grade level. More than 75 families have been moved in, with nearly 50 actively housed families.
For more information, click on the Web Link.
Affordability Watch Q2 2022
Despite inflation and worries about a recession, demand for apartments remains strong but at subdued levels. The strong labor market continues to increase demand steadily, but supply shortages remain a high concern. The U.S. must build 266,000 new apartment homes annually to meet apartment demand. Increased costs of construction, restrictive land use regulations and NIMBYism have created roadblocks for developers to build more apartments. Limited supply results in higher rents and households that spend more on rent are left with less money for other expenses. This creates a vicious cycle where renters struggle to keep current with rent, especially when inflation and rising interest rates intensify financial stability risk.
For more information, click on the Web Link.
Registration Open for NAA’s Apartmentalize Conference
Experience the incomparable force of Apartmentalize next June in Atlanta. Apartmentalize is the hub for rental housing industry professionals to connect, share ideas and discuss solutions. Come ready to be inspired, gain knowledge and build a network of innovative thinkers and strategists.
For more information, click on the Web Link.
NAHMA Releases 2022 Affordable 100 List
The National Affordable Housing Management Association (NAHMA) announces its 2022 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 issue of NAHMA News. 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 two 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) and the National Apartment Association Education Institute (NAAEI).
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 becoming a SHCM Company, click on the Web Link below.
Upcoming Events
NAA Assembly of Delegates
November 15-17, 2022
https://www.naahq.org/meetings-events/upcoming-meetings
NAHMA Biannual Top Issues in Affordable Housing Conference — Winter 2023
March 8-10, 2023
https://www.nahma.org/meetings/
NAA Advocate
March 28-29, 2023
https://www.naahq.org/upcoming-events
NAA Apartmentalize
June 7-9, 2023
https://apartmentalize.naahq.org/
NAHMA Biannual Top Issues in Affordable Housing Conference — Fall 2023
October 24-26, 2023
https://www.nahma.org/meetings/
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