May 2, 2017

Community Developments: Fair Housing Rule, Discriminatory Lending Lawsuits

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  • As previously reported in Community Developments, legislation was introduced in the House of Representatives in January that aims to prevent federal funds from being used for fair housing activities under the Affirmatively Furthering Fair Housing (AFFH) rule. Those opposed to the AFFH rule argue that HUD is forcing “federal zoning control” on local jurisdictions, and imposing standards on small communities that don’t have the resources to meet the requirements. However, according to affordable housing experts, these concerns are often misplaced. Twenty-two municipalities participated in AFFH compliance last year and 105 have committed to the reporting in 2017, including big and small cities. “There seems to be concern about federal government overreach, but HUD is giving the cities the time and space they need,” says Marion McFadden, vice president of public policy at Enterprise. “Lots of communities don’t know what the history is, but more than anything else, this lets them know how we got to where we are and lets them know how not to impede things further. HUD is being reasonable in this.” At this time, it is not clear whether or not lawmakers or the administration will attempt to roll back the rule. (Next City, May 2)
  • In a 5-3 ruling released Monday, the Supreme Court ruled that cities have the right to sue banks over predatory lending practices, if an alleged violation of the Fair Housing Act is claimed. The ruling stems from a lawsuit brought by the city of Miami, which sued Bank of America, Wells Fargo and Citigroup in 2013, stating that the banks engaged in predatory lending to minority borrowers. Importantly, the Supreme Court cautioned in its ruling that meeting the burden of proof could be difficult to achieve. (HousingWire, May 1)
  • The Trump Administration is aiming to complete housing finance reform by early next year, said Treasury Secretary Steven Mnuchin at an event hosted by the Milken Institute yesterday. That timeline is consistent with the one laid out last week by Senate Banking Committee Chairman Mike Crapo (R-Idaho). (Politico Pro, May 1)
  • Nationally, rent prices increased slightly in April, with the median one-bedroom rent rising to $1,012 per month, according to ABODO’s latest National Apartment Report. The nation’s largest rental hike in April came in Glendale, Arizona, while the steepest drops occurred in Lincoln, Nebraska, and Fort Wayne, Indiana. According to ABODO, San Francisco, New York City and San Jose continue to top the list of cities with the nation’s highest rents. (ABODO, May 1)
  • New data show that California’s housing inventory increased by 88,562 units, or one new home for every 3.78 new residents, over the past year. However, some experts say that the increase is still below what would be enough to keep up with the growing population. Many economists and academics point to the relative lack of new housing construction as the chief reason that home prices and rents have grown far faster in California in recent decades than the nation as a whole. Though California’s population grew faster than the housing supply last year, the rate of construction has improved as builders take advantage of the economic recovery. (Los Angeles Times, May 1)

  • An op-ed in The Seattle Times looks at the growth of suburban poverty in King County, Washington. Poverty in King County is largely a suburban problem, rather than an urban one, as more than two-thirds of all households at or below the federal poverty level live in the county’s suburbs. The suburbanization of poverty has increased dramatically across the country between 2000 and 2011. For the first time, a majority of impoverished communities in the U.S. are concentrated in suburban areas, which face different challenges than those in urban areas, such as limited transportation choices and poor access to supporting services. (The Seattle Times, May 1)

  • Today, CoreLogic released its Home Price Index (HPI) data for March 2017, which show that home prices are up both year-over-year and month-over-month by 7.1 and 1.6 percent, respectively. The CoreLogic HPI Forecast indicates that home prices will increase by 4.9 percent on a year-over-year basis between March 2017 and March 2018. (CoreLogic, May 2)

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