Community Developments: Enterprise Releases Report on SMMF Properties
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- Small and medium multifamily housing (SMMF) – properties with between two and 49 units – is a much more important source of homes than has generally been recognized, especially for low-income households, according to new research from Enterprise and The USC Bedrosian Center on Governance, housed at the USC Price School of Public Policy. Understanding the Small and Medium Multifamily Housing Stock, released today, finds that SMMF provides homes to the lowest-income households, including for the majority of renters earning $50,000 or below and for 60 percent of all renters who make less than $10,000 per year. However, according to Andrew Jakabovics, vice president of policy development and research at Enterprise and one of the authors of the paper, there are significant regulatory costs to building multifamily housing, and developers that do win approval want to build more than just a few apartments. The report concludes that policymakers should prioritize the development of financial tools to preserve SMMF and reduce barriers to production of new SMMF to help ease growing housing affordability challenges in the U.S. Read the full report on Enterprise’s website. See news coverage in Bloomberg and Affordable Housing Finance.
- As previously reported in Community Developments, the White House Office of Management and Budget has proposed $18 billion in new program cuts for fiscal year 2017 to offset the increases to defense and border security spending that the President favors. This latest proposal would cut Community Development Block Grant funding in half (about $1.5 billion) and reduce the Neighborhood Reinvestment Corporation by $75 million. It would also eliminate all funding for the Community Development Financial Institutions Fund at the Treasury Department as well as HUD’s Self-Help Homeownership Program (SHOP), Section 4 Capacity Building for Affordable Housing and Community Development and the Choice Neighborhoods Initiative. In a new blog post, Marion McFadden, vice president for public policy at Enterprise, writes that Congress must reject these proposals, since they would cut vital domestic programs that address local needs. Read Marion’s blog post on the Enterprise blog.
- Zillow finds that renters in communities of color spend a much larger share of their income on rent each month than those in white communities – a trend that has persisted over the past five years. This inequality in housing affordability also makes it difficult for black and Hispanic households to afford to live in high-opportunity areas, and almost impossible to save for a down payment on a home. (Zillow, March 30) A second analysis by Zillow examines the gap in the poverty rate between renters and homeowners that has widened over the past four decades. More than two-thirds of low-income households rent while more than two-thirds of households not in poverty own their homes. Zillow also finds that poverty rates are highest among black renters and single parents, and in older, low-density multifamily rental units, which are often found in the suburbs. (Zillow, March 29)
- An analysis by The New York Times Upshot charts the dynamics between school quality, home prices and commuting times in metropolitan areas across the nation. In general, home values are higher in areas where school quality is also high. However, home prices are often lower in towns that have high performing schools but are far from city centers, compared to those that are closer to city centers. The analysis also finds that in some dense city areas with high transit access, the preference for being in a city center seems to outweigh the importance of school quality by a significant margin. In the Bay Area, for example, homes in the central city carry a huge premium compared to homes in the surrounding suburban areas, even though the central city has a large variation in school quality. (The New York Times Upshot, March 30)
As HUD Secretary Dr. Ben Carson continues his listening tour of select communities and HUD field offices across the U.S., Dr. Carson visited the Dallas/Fort Worth area this week. Dr. Carson’s tour of the area includes visits to various sites and meetings with the mayor of each city. The first stop on Dr. Carson’s listening tour was Detroit, his hometown. (HousingWire, March 29)
Yesterday, the Federal Housing Finance Agency (FHFA) released a Progress Report on the 2016 Scorecard for Fannie Mae and Freddie Mac. The report summarizes major activities of the government-sponsored enterprises (GSEs) in 2016 that contributed to FHFA’s three goals as conservator of the GSEs: maintain, reduce and build. These activities include efforts made by the GSEs to address borrower impediments to credit access, as well as advances made in the GSEs’ credit risk transfer programs. (FHFA, March 29)
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