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Announcements
NAAEI Staff Celebrate National Job Corps Day on Capitol Hill
On September 23, NAA Education Institute staff helped celebrate National Job Corps Day on Capitol Hill. NAAEI staff displayed and distributed apartment career information during the day-long exhibit in the Rayburn House Office Building. National Job Corps staff, including the Interim National Director of Job Corps Lynn Intrepidi, Job Corps Center Administrators and Job Corps students were in attendance.
National Job Corps Day was declared by Congress and is part of the 45th Anniversary of Job Corps, the largest and most successful residential and educational workforce training program for economically disadvantaged youth in the United States. Job Corps serves nearly 65,000 young Americans every year.
NAAEI is proud to partner with Job Corps to help place trained facilities maintenance students in Work-Based Learning assignments at apartment communities and eventually in full-time apartment maintenance positions.
For more information on how you can recruit skilled maintenance talent by partnering with your local Job Corps Center, please click on the link below.
Headlines
Association News
Find Hands-on Maintenance Training Courses in Your Area
NAA Education Institute Announces First-ever National Apartment Careers Month
Save the Date: Next SHCM Webinar Scheduled for Nov. 17 at 2 pm eastern
Revised and Updated Fair Housing: A Guidebook for Owners and Managers of Apartments Now Available
NAHMA Announces New Tax Credit Housing Management Publication
Industry News
"HUD Secretary on Housing"
"Financial Crisis Cripples New Affordable Housing"
"Affordable Rental Housing A.C.T.I.O.N. Campaign; National Coalition Urges Congress to Support Investment in Affordable Rental Housing"
"Groups Agree to LIHTC Stimulus Plan"
"Demand Grows for Affordable Housing for Seniors"
"Guest Editorial: Don't Forget About the Renters"
"A Struggle for Affordable MF"
"Building a Better Public Housing Policy"
"Affordable Housing at Issue in Tax Break Fight"
"GSEs Tighten Up on Student Housing Deals"
"Life Goes On"
"Turning Away From Fannie Mae"
Association News
Find Hands-on Maintenance Training Courses in Your Area
The NAA Education Institute has partnered with local apartment associations nationwide to bring the Certificate for Apartment Maintenance Technicians (CAMT) training courses to your area. This nationally recognized program offers hands-on maintenance training in several apartment maintenance disciplines, such as plumbing, electrical, HVAC, appliances, and interior and exterior maintenance and repair.
Click on the link below to learn more about this unique program.
The following local apartment associations will be offering CAMT:
South East Florida Apartment Association
November 10-13, 2009, Palm Beach Gardens, FL
Southwest Florida Apartment Association
December 8-11, 2009, Fort Myers, FL
Apartment and Office Building Association of Metropolitan Washington
October 22, 23, 29, 30 & November 5-6, 19-20, 2009, Washington, DC
Austin Apartment Association
December 15-18, 2009 & January 5-8, 2010, Austin, TX
Louisville Apartment Association
January 26-29 & February 23-26, 2010, Louisville, KY
Roanoke Valley Apartment Association
January 12-15 & February 16-19, 2010, Roanoke, VA
Arizona Multihousing Association
February 2-5, & March 2-5, 2010, Phoenix, AZ
For more information about any of the classes listed or to register, please contact Kimberly McCrossen, Program Manager at 703-518-6141 ext. 121.
NAA Education Institute Announces First-ever National Apartment Careers Month
The NAA Education Institute announces that February 2010 will be the first-ever National Apartment Careers Month.
National Apartment Careers Month addresses the industry’s need to attract and foster new talent entering the apartment industry. National Apartment Careers Month aims also to encourage hiring personnel, whether they are onsite managers or corporate human resources managers, to think outside the box when addressing their hiring needs and not to hire someone based solely on previous apartment industry experience, but rather for core competencies such as customer service.
National Apartment Careers Month is the time to get involved in workforce outreach through career organizations such as Job’s for America’s Graduates (JAG), DECA, Job Corps, SkillsUSA or the local community or technical college, tapping those previously underutilized career resources. Consider offering internships at your company, maybe a day of job shadowing leasing, maintenance and management staff at your communities or participating in local high school or college career fairs.
Learn how your company can participate in National Apartment Careers Month, click on the link below and fill out the participation form or contact Julie Barden, Manager of Communications and Affiliate Relations at 703/518-6141, ext. 691.
Save the Date: Next SHCM Webinar Scheduled for Nov. 17 at 2 pm eastern
Presenters will be Grace Robertson of the IRS, and tax credit training specialists Gianna Solari and Anita Moseman. The webinar will provide an hour of instruction, followed by about 20 or 30 minutes of Q&A. Ms. Robertson will present information on the new 8823 guide, and Ms. Solari and Ms. Moseman will lead an interactive panel discussion on the “top 10” most difficult LIHTC compliance issues.
Registration will be free to SHCM certificants and $75 to non-SHCMs.
Registration details will be emailed to SHCM certificants by mid to late October.
Revised and Updated Fair Housing: A Guidebook for Owners and Managers of Apartments Now Available
NAHMA has announced the revised and updated Fair Housing: A Guidebook for Owners and Managers of Apartments is now available.
To help property management staff understand and comply with fair housing requirements, NAHMA has partnered with The Compass Group to provide a completely updated and authoritative Fair Housing Guidebook.
The book provides 21 chapters of valuable information, including an overview of fair housing laws and regulations, suggested policy approaches that will provide a firm foundation for each property’s fair housing efforts, citations for landmark cases, plus a variety of appendices containing useful information that is sometimes not easy to find. Finally, the guidebook includes insights from expert owners and managers who have faced these issues and developed particularly effective approaches. It is also available in CD format.
“We believe the new Fair Housing Guidebook is an essential tool and reference that should be kept on hand at every multifamily property across the country. It is available at the affordable and special NAHMA member discount price of just $40 per copy – which we believe will enable every property to purchase its own copy for hands-on staff use,” said NAHMA President Daniel Murray, NAHP-e. For more details on ordering the Guidebook, please click on the link below.
NAHMA Announces New Tax Credit Housing Management Publication
A new publication, A Practical Guide to Tax Credit Housing Management, is now available from NAHMA. The 74-page spiral-bound book is an informative yet easy-to-read primer on tax credit housing management.
The user-friendly guide will help you understand key concepts in the Low Income Housing Tax Credit (LIHTC) program, including Fractions and Credits, Eligible Basis, Qualified Basis, Minimum Set-Aside, Rules of Calculation of Income, Student Households, Amenities and Services, Non-Transient Occupancy, and more.
In addition, the book is designed as a referencew guide for the Specialist in Housing Credit Management® (SHCM®) certification. The SHCM program is unprecedented as the only national certification program supported by three national trade associations and their members. Joining NAHMA in the strategic alliance are the National Apartment Association Education Institute (NAAEI) and the American Association of Homes and Services for the Aging (AAHSA).
“As experienced affordable housing management professionals know, the tax credit program is the primary production tool for creating new affordable housing properties across every state in the country, and it is also the most important tool for rehabilitating and preserving the nation's existing stock of aging affordable housing,” said NAHMA President Daniel Murray, NAHP-e. “To maximize their careers, management professionals in the affordable housing industry must be able to demonstrate their experience and expertise in mastering the complex requirements of the tax credit program.” The publication can be ordered at NAHMA’s webstore via the link below.
Industry News
HUD Secretary on Housing
Multi-Housing News (09/09) Foong, Keat
Housing and Urban Development (HUD) Secretary Shaun Donovan estimates that more than 6 million households nationwide either lack quality housing or affordable housing, making Multifamily Housing Programs more vital than ever. HUD hopes to strengthen existing programs so that they become more responsive. For example, HUD seeks to boost coordination between FHA’s insured programs and Low Income Housing Tax Credits (LIHTC) to ease the development of affordable, insured housing. Furthermore, the Recovery Act and HUD’s FY 2010 budget seek to inject $2.25 million into HOME funding to stabilize projects financed by LIHTC and add $2 billion to the Neighborhood Stabilization Program. HUD is also overhauling two current insured programs to increase liquidity for both construction and permanent financing. In addition, the agency is updating its environmental practices to make them less restrictive with respect to multifamily housing. A proposed HUD initiative called Choice Neighborhoods, if approved by Congress, would significantly increase the federal commitment to the assisted housing stock in HUD's budget. HUD's budget also increases funding for the Housing Choice Voucher program by $1.8 billion.
Financial Crisis Cripples New Affordable Housing
Washington Post (08/28/09) Elphinstone, J.W.
Funding for affordable apartment construction has fallen to $4 billion from more than $8 billion over the past two years due to the absence of investors in federal low-income housing tax credits, and hundreds of projects nationwide are stalled as a result. Fannie Mae and Freddie Mac stopped investing in these tax credits when they were taken over by the government in 2008, eliminating 40 percent of funding for affordable housing. National banks also were big investors in the tax credits, but they now concentrate on investments in areas governed by federal community reinvestment laws. This means projects in the South and Midwest have been hit hard. Although the U.S. Treasury plans to devote $5 billion in stimulus funds to purchase unsold tax credits for low-income housing projects in the works since 2008, experts say the money will not be enough. Research indicates that 3 million affordable apartments are no longer available due to conversion, upgrades, or elimination, and over 50 percent of renters are devoting 30 percent or more of their gross income on housing costs. Industry groups are pushing for an extension of the Treasury's credit exchange program so that projects approved for next year are included, and they want the credit to be carried back five years.
Affordable Rental Housing A.C.T.I.O.N. Campaign; National Coalition Urges Congress to Support Investment in Affordable Rental Housing
Real Estate & Investment Week (09/26/09)
Members of the Affordable Rental Housing A.C.T.I.O.N. (A Call To Invest in Our Neighborhoods) Campaign met with Congressional staff members on September 3 to discuss industry consensus proposals included in a letter recently sent to urge Congress to enact proposed changes to the Low-Income Housing Tax Credit (LIHTC) in upcoming tax legislation. The group says the industry consensus proposals would stimulate affordable rental housing production while creating and saving tens of thousands of jobs. The A.C.T.I.O.N. Campaign is a grassroots effort focused on stimulating investment in affordable rental housing led by a national coalition of cross-industry organizations. The goal of the Campaign is to restore the amount of affordable rental housing built, rehabbed and preserved annually in communities across the country. Since 1986, the LIHTC has helped finance more than two million units of affordable rental housing and until recently about 120,000 apartments annually. Investors have received a solid return on their investment for providing the capital to finance much-needed housing. With the weakened economy and investors cutting back their demand for tax credits, however, as many as 60,000 fewer units will be constructed or preserved and up to 90,000 jobs could be lost annually. This comes at a time when the current foreclosure crisis is creating an even greater need for affordable rental housing. The composition of LIHTC investors has changed over time from individuals in the earliest years of the program, to institutional investors across a range of industries and finally to the current investor base of large financial corporations. However, this narrowed investor base left the market for LIHTCs susceptible to the credit crunch affecting financial institutions beginning in 2008. LIHTC investment levels fell dramatically from about $9 billion in 2007 to approximately $5.5 billion in 2008. Since most affordable rental housing development depends on capital raised from the LIHTC, many state-approved developments have been stalled or abandoned as a result. The Campaign is urging Congress to enact the proposals to allow these developments to secure financing, reactivate affordable rental housing investment for the long term and bring back the LIHTC to its full potential to produce, rehab and preserve affordable rental housing nationwide.
Groups Agree to LIHTC Stimulus Plan
Affordable Housing Finance (08/09) Kimura, Donna
Private investment in the low-income housing tax credit (LIHTC) market fell to $5.5 billion in 2008 from $9 billion the previous year, and numerous industry groups have agreed on a set of legislative proposals to spur private investment in the LIHTC market. The first proposal would extend the exchange program established by the American Recovery and Reinvestment Act through 2010 and expand it to include the 4 percent housing credits for tax-exempt bonds. A second proposal would increase the carryback period to five years for credits on tax returns filed in 2008 to 2010 only to the level of credit reinvested in affordable rental housing. Additionally, this proposal would allow credits generated by new LIHTC housing to be carried back for up to five years in a 10-year credit period. The last proposal would modify the tax code and enable S corporations, limited liability companies, and closely held C corporations to be on par with widely held C corporations by offsetting revenue with tax credit benefits.
Demand Grows for Affordable Housing for Seniors
Seattle Times (08/22/09)
Housing availability for the country's poorest seniors will rank among the most pressing issues in the years to come. According to a congressional study conducted earlier in the decade by a commission on affordable housing and health needs for seniors, one in six people will be age 65 or older in 2020 compared to the current ratio of one in 12. Demand for government-subsidized rental properties for seniors significantly outweighs projected future supply, and many existing buildings are in dire need of upgrades and repairs. Despite the best efforts of nonprofit groups and developers, new construction is simply not keeping pace with demand, especially in these credit-crunched times. The low-income senior population lives mostly on fixed incomes from Social Security. The most recent Census Bureau data shows that two in five households 65 or older earn less than half of the U.S. median income. Meanwhile, about one in 10 household heads in this age group live in poverty. Section 202, the only affordable housing program dedicated solely to senior citizens, presently has around 250,000 units. Waiting lists can be at least a year or longer for affordable rental apartments. On average, nine people are on the waiting list for each existing Section 202 unit. Further research shows that nearly 33 percent of renters age 65 and over spend half or more than half of their income on rent and utilities. Taking into account the cost of health care, medicine and food, this growing group fights for its survival on a monthly basis.
Guest Editorial: Don't Forget About the Renters
Tennessean (09/17/09) Egan, Conrad
In this op-ed, National Housing Conference President and CEO Conrad Egan says the unregulated mortgage market and homeownership-focused housing policies are responsible for rising foreclosure rates. Egan says efforts to increase sustainable homeownership "need to be balanced with the recognition by policymakers that tens of millions of families call rental housing home. A strong policy infrastructure centered on supporting rental housing overall, and affordable rental housing for low- to moderate-income families in particular, is necessary." Egan says the various programs and agencies within the U.S. Department of Housing and Urban Development must collaborate for such a policy to be successful, and local governments must ensure that land-use zoning and planning take into consideration the need for rentals. At the same time homeownership policies are revised to reduce risk, Egan says Section 8 and other affordable rental subsidy programs must be reformed.
A Struggle for Affordable MF
National Mortgage News (09/14/09)
An editorial in National Mortgage News says that, despite the attention given to the successful single-family tax credit for new homeowners, the Low Income Housing Tax Credit (LIHTC) has been in decline. LIHTC provides tax breaks to people who invest in rental projects, allowing them to obtain a tax credit and purchase property at significant discounts. Comptroller of the Currency John Dugan said that LIHTC has financed an average of 100,000 affordable rental units for each of the past 20 years. The biggest market disruption, however, has been Freddie Mac and Fannie Mae going to zero in 2008. Equity dropped last year to $5.5 billion, down from a peak of $9 billion in 2007, and is projected to be $2.5 billion this year. The economic stimulus package and the Federal Housing Administration are attempting to make up for lost equity and assist multifamily developers.
Building a Better Public Housing Policy
CQ Politics (07/17/09) Benson, Clea
Most high-rise projects and garden apartments have been torn down, and were replaced in the 1960s and 1970s, during another time of revitalization. The current theory about revamping public housing is that replacing buildings in the same location is not the most effective solution. Instead, experts think that it is better to intermingle poor families with high-income people, instead of concentrating them in one area. That way, low-income families can utilize resources that wealthier households have in their neighborhoods. However, the effort to de-concentrate poverty has caused a loss of government-owned housing and private developers who rent buildings to the poor have removed many properties from the program. Currently, the biggest form of public housing is subsidized rent vouchers, known as Section 8 or Housing Choice. But, the number of available vouchers is smaller than the amount of renters who qualify for housing. Congress is now ready to consider multiple solutions for short-term needs as well as longer-term problems, including an affordable-housing trust fund and changing the Section 8 program. Many experts feel that it is better to keep the current housing units standing, rather than tear them down because it is less expensive than development. Supporters of this view agree because they sometimes have trouble finding housing with their Section 8 vouchers. Others think that preservation should be part of the policy, but not the entire scope. Advocates for Section 8 would like to see a doubling of the number of vouchers, which have stayed around 2 million recently. Democrats are planning on overhauling Section 8. “In terms of the ability to de-concentrate poverty, it's a mixed bag,” says Alex Schwartz, a professor of housing policy at the New School for Management and Urban Policy. “Public housing is more flexible; it can serve a wider range of incomes, and if it’s well managed, it can survive in perpetuity.” Public housing officials also learned that replacing public housing with vouchers was not always helpful to families because they ended up in new ghettos. One idea to solve the problem of concentrated poverty is to develop more rental housing outside the inner city. Another is to make it easier to provide the maximum number of vouchers and make it easier for private landlords to participate. The Section 8 Voucher Reform Act hopes to move toward those solutions. However, experts say that the bigger picture needs to be examined. New ways to invest government dollars to continue private investment should be developed, as well as better coordination of resources and expanded living options. It is not just about housing, but also about good schools, walkable retail, and public transportation.
Affordable Housing at Issue in Tax Break Fight
Oregonian (09/23/09) Larabee, Mark
Museum Place South in downtown Portland was considered a template for how the city and private developers could finance affordable housing for low-income citizens when it opened six years ago. Low-interest loans helped underwrite the project, which was eligible for a 10-year break on property taxes in return for low rents on some of the units. However, Multnomah County's tax assessor has informed developers that they will no longer qualify for the tax break for commercial space in Museum Place South and 18 other buildings, due to a recent ruling from the Oregon Department of Justice. Commissioner Nick Fish says the tax break is essential to the forward momentum of many development projects. Reese Scholes, communications policy director for County Chairman Ted Wheeler, says the decision to bill property owners for taxes constitutes "the rule of law." Multnomah County assessor Randy Walruff says his office started investigating Portland's tax break policies in 2006 when problems cropped up in a program for owners of single-family homes in distressed neighborhoods, and city and county audits have uncovered insufficient monitoring and other issues. Walruff adds that in 2008 the state attorney general ruled that county assessors were the ultimate authority for guaranteeing the appropriate application of tax breaks by governments. In August, the attorney general notified Multnomah County that although residential space is eligible for the tax break, storefronts are not. Fish argues that the city and county supported such breaks for close to 20 years and that Walruff's recent decision violates the development contracts, which will likely lead to a lawsuit. "The real cost may very well be our entire system for building affordable housing," he warns.
GSEs Tighten Up on Student Housing Deals
Affordable Housing Finance (08/09) Ascierto, Jerry
While other segments of the multifamily housing market show signs of weakness, experts say the student housing niche should see flat or modest rent growth. With 5 million Echo Boomers poised to turn 18 in 2010, with the number hovering above 5 million through 2020, the student housing market should see gains in rents and occupancy rates over the long term. However, Fannie Mae and Freddie Mac have raised the loan-to-value ratio on student housing deals to 75 percent. The government-sponsored enterprises attribute the move to the lack of industry data, weak investor appetite for student housing loans, and the small number of student housing specialists. According to Fannie Mae's Frank Lutz, "There are a limited number of really capable, qualified, great operators. If you're forced to take something back, you can't easily take a non-student housing operator and let them step in on that deal and assume it will operate with the same efficiency." Even so, 10-year student housing mortgages with all-in rates in the low-to-mid-6 percent range remain available to strong borrowers.
Life Goes On
Housing Finance (09/30/09) Anderson, Bendix
Last year, an overwhelming number of properties received low-income housing tax credits. In North Carolina, Mark Shelburne secured nearly 30 LIHTC properties that they would utilize the exchange program fund for, receiving cash trade-ins. According to the North Carolina Housing Finance Agency, more equity will be available this year as more affordable housing developers are assisted through a government stimulus funds. Despite the housing market reaching an all-time low, a number of states have had projects win LIHTCs. In Florida, nearly 40 projects were in the running for LIHTCs, with the state taking unsold tax credits off the market through the exchange program. Similarly, the Virginia Housing Development Authority has more than 30 affordable housing projects planned through tax credits. Tax credit demand remained high as the state received applications for $50 million worth of LIHTCs, though only $18 million was available. Virginia is also expected to see tremendous interest from out-of-state developers, due to the state's proximity to the nation's capital.
Turning Away From Fannie Mae
Affordable Housing Finance (09/09) Ascierto, Jerry
Affordable housing developers hoping to revive stalled projects will likely avoid Fannie Mae for debt due to the company's high rates on forward commitments. As of late August 2009, Fannie Mae offered a rate of approximately 9 percent for funded forward commitments and approximately 9.5 percent for unfunded forward commitments, compared to about 7.75 percent and 8.25 percent in early March. Borrowers are now turning to the Federal Housing Administration (FHA) to fund new low-income housing tax credit (LIHTC) developments. The FHA made changes in 2008 in how tax credits function in its Sec. 221(d)(4) program, making it much easier to implement. Sec. 221(d)(4) deals are being priced about 200 bps below Fannie and Freddie, and the FHA will go up to 90 percent loan-to-cost and down to a 1.11x debt-service coverage ratio (DSCR), respectively. The government-sponsored enterprise (GSE) is also seeing significant refinancing business on tax credit and Sec. 8 deals. In Florida, for example, a borrower looking to refinance a tax credit or Sec. 8 deal can expect a 65 percent loan-to-value (LTV) and a 1.35x DSCR at best. Many banks are hoping to take away market share from the GSEs by competing to fulfill Community Reinvestment Act (CRA) requirements. Several banks are providing "miniperm" loans, or construction loans that have a permanent term extending through the compliance period.
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