January 9, 2019

Partial Shutdown Affects Growing Numbers of Workers and Families Across the Country

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  • In a blog post, Enterprise’s Senior Director of Congressional Relations Liz Osborn notes that as the “partial federal shutdown continues with no end in sight, employees and programs, and the people and communities they support, are bearing heavier and heavier burdens.” The shutdown began on December 22, when the continuing resolution funding approximately 25 percent of the government expired. Osborn points out that currently, 420,000 federal employees are working without pay and an additional 380,000 workers are furloughed, many of whom are low-wage government contractors living paycheck to paycheck and at risk of housing instability. In addition, the consequences are particularly dire for the nearly 5 million households who live in HUD-assisted housing, as the shutdown is threatening their ability to pay rent and utilities and access health care and supportive services. Greater detail on the consequences of the shutdown for affordable housing and community development programs can be found in a letter to congressional leaders and press release published yesterday by the Campaign for Housing and Community Development Funding (CHCDF). Enterprise is a CHCDF member and joins with affordable housing stakeholders and partners across the country in calling on Congress and the Administration to end the government shutdown and pass full year spending bills that provide strong funding for affordable housing and community development. Read our new post on the Enterprise blog.
     
  • A new survey by the National Association of Realtors (NAR) found that 11 percent of the surveyed members reported an impact on current clients’ contract signings or closings and 11 percent on potential clients. According to NAR, The Department of Agriculture will not issue new rural housing Direct Loans or Guaranteed Loans, and scheduled closings of Direct Loans will not occur. NAR points out that delays in loan origination can be expected if the shutdown continues, as the IRS will close and suspend the processing of all forms, including requests for tax return transcripts that are required by many lenders for many kinds of loans. This could impact loan origination for mortgages backed by the Federal Housing Administration and the Department of Veterans Affairs. (NAR, January 2019) The FHA has called on all approved mortgagees and lenders to be “sensitive to the financial hardships experienced by borrowers as a result of the shutdown, including those borrowers subject to furlough, layoff, or a reduction in income related to the shutdown.” (HUD, January 8)   
     
  • With the end of Mel Watt’s term as director of the Federal Housing Finance Agency (FHFA), Comptroller of the Currency Joseph Otting has stepped in to serve as acting director of the FHFA. The President has nominated Mark Calabria, who currently serves as chief economist for Vice President Mike Pence, to lead the FHFA. The Senate has not acted on Calabria’s nomination. (HousingWire, January 7) As previously noted in Community Developments, Calabria has opined that one way to pursue housing finance reform is to end Fannie Mae and Freddie Mac’s (the Government Sponsored Enterprises, or GSEs) housing goals, a reference to the GSEs’ mandate to serve low-income communities. He has also suggested tightening homebuying standards by requiring minimum down payments of 5 percent and minimum FICO scores of 700.

Upcoming Webinars

  • On Thursday, January 17, Enterprise Community Partners will host a webinar on “Opportunity360 Overview and Q&A.” This webinar will go through Opportunity360 tools and resources, including the Measure Tool, which can be used to create and download a 25-page Measurement Report for any census tract in the country, and the Opportunity Zone Explorer Tool that enables users to obtain data-rich views of every Opportunity Zone across the country. Register here for the webinar.
     
  • Also on January 17, Enterprise Community Partners will host a webinar on “Creative Placemaking: Perspectives of Artists and Developers.” This webinar will discuss the experiences of two community developers who joined forces with a theater artist and writer to elevate their community engagement approach. Register here for the webinar.

In Case You Missed It

  • The Office of the Comptroller of the Currency, the Federal Reserve Board, and the Federal Deposit Insurance Corporation (the agencies) have released a notice of proposed rulemaking inviting public comment on amendments to the agencies' regulations requiring appraisals for certain real estate-related transactions. The proposed rule would increase the threshold at which appraisals would not be required for residential real estate-related transactions from $250,000 to $400,000. The agencies are also proposing to define a residential real estate transaction as a transaction involving a single 1-to-4 family residential property. The proposal would require regulated institutions to obtain evaluations for transactions secured by residential property in rural areas and would fulfill the requirement that the agencies add appraisal review to the minimum standards for an appraisal, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act. Comments are due by February 5, 2019.

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