Tuesday, December 29, 2009

NHC 2009 "Pioneering Housing Strategies" Award Finalist Bank of America

NHC Member Partner Bank of America was a 2009 “Pioneering Housing Strategies” Award finalist for its End to End Taxable (E2E) Term Loan product. E2E is the result of a first-of-its-kind collaboration with Impact Community Capital, LLC (Impact), an organization formed by top insurance companies seeking to promote socially responsible investments in underserved communities.

Created to broaden the secondary market for financing affordable multifamily housing with the goal of helping to lower the cost of debt, E2E is designed for projects targeting low- to moderate-income renters with incomes primarily at, or below, 60 percent of the area median income.

Specifically, the partnership enables Bank of America to combine construction loans with permanent loans – providing a single-commitment, single-closing approach to financing affordable multifamily housing or mixed-use real estate. Following construction completion and loan conversion, Impact purchases the permanent loan and then pools loans that can be rated by a major rating agency, creating mortgage-backed securities that meet the investment needs of large institutional investors, particularly insurance companies.

To date, Bank of America has closed and sold over $246 million in E2E Term Loans to Impact’s investment vehicle. The bank’s construction financing associated with E2E Term Loans have reached more than $460 million since the product’s first roll out. These financing commitments have produced more than 12,600 affordable units in 144 housing developments across the U.S. that are either under construction or occupied by low income renters.

It is important to note that the E2E product is part of Bank of America's $1.5 trillion, ten-year community development lending and investment goal that was initiated in January 2009.

Thursday, December 24, 2009

Special Guest Feature With Barry Zigas: What's Next for Fannie and Freddie?

Yesterday, the Financial Times published a summary piece on what's likely to happen next to Fannie Mae and Freddie Mac. The Obama Administration has committed to laying out options in its February, 2010 budget submission. But the folks responsible for producing them may rue this promise made earlier in 2009 when the rest of the Administration's financial modernization package was unveiled.

The government's unprecedented and aggressive support for the mortgage markets hinges almost entirely on the continued role the two companies play in the market. The private securitization market is dead. Recent research from JP Morgan suggests that it will remain that way from some time to come. It’s unclear what demand for their MBS will be if the Fed makes good on its plan to phase out its own $1.25 trillion MBS purchase program next spring, but no one is ready to roll the dice on an new, untested model just yet.

The two companies also are playing a crucial role in the Administration's Making Home Affordable" mortgage modification program. Once restructured, it isn't clear how that capacity could be easily replicated.

The government may have the two companies exactly where it wants them: firmly under government control, and available to be used to further public policy goals without interference from shareholders or private owners.

With many trillions of outstanding MBS under their guarantee, a huge ongoing role in financing affordable apartment homes, and a combined single family market share around 70 percent now, a great deal of the housing market's immediate and near future health seems to ride on the two companies and the market's faith in their guarantees on the securities.

An awful lot hinges on getting this right. Rushing to a solution merely for the sake of having one is not the right choice.

Barry Zigas is housing policy director for the Consumer Federation of America. He also works with other nonprofits and foundations through Zigas and Associates, LLC.

Wednesday, December 23, 2009

In-Depth Media Coverage: Center for Housing Policy Affordability Study Finds U.S. Housing Costs are on the Rise

This month, NHC’s research affiliate, the Center for Housing Policy, released a new report entitled Housing Affordability Trends for Working Households, which found that the share of working owners with a severe housing cost burden – that is, the share of households spending more than half their income on housing – rose from 18 to 20 percent during the three-year period studied. The report’s analysis finds that the share of working owners with a severe housing cost burden – that is, the share of households spending more than half their income on housing – rose from 18 to 20 percent during the three-year period studied. In-depth media coverage of the report includes articles in The Washington Post, The Tampa Tribune and an interview with the Center’s Senior Research Associate Keith Wardrip on WJBC Radio News (IL).

One of the main reasons why home price declines have not improved housing affordability is that most homeowners have not moved since the foreclosure crisis started and, as a result, have not benefited from the lower prices. Other reasons why housing affordability has worsened include: utility costs that have grown at more than double the rate of inflation, increasing housing payments due to adjustable-rate mortgages resetting, and an unemployment rate that began trending up in the last year of the time period studied.

Tuesday, December 22, 2009

NHC 2009 "Pioneering Housing Strategies" Award Finalist the Atlanta Housing Authority

The Atlanta Housing Authority (AHA) was an NHC 2009 “Pioneering Housing Strategies” Award finalist for its outstanding work in public housing in Atlanta, which has undergone a remarkable transformation over the past fourteen years. And, along with it, so have many once-broken urban neighborhoods and the often marginalized families living in them. Changes of such significance were possible only through a radical rethinking of how to improve housing and housing options for families living below the poverty line—a rethinking enabled in great part by HOPE VI. Specifically, AHA was determined to use HOPE VI to reverse the cycle of low expectations and poor outcomes.

Today, AHA is assisting 19,500 households (approximately 6,000 more than in 1994) in a much broader array of healthier, safer, and opportunity-enhancing housing, from private apartments rented with Section 8 vouchers to nine new mixed-use, mixed-income communities; five mixed-income communities; and more than thirty-five project-based rental assistance mixed-income arrangements with private owners. AHA is also implementing plans under its Moving to Work agreement to relocate affected households by using Section 8 vouchers and to close and demolish by the end of 2010 its remaining distressed and obsolete family public housing projects and two projects for senior citizens and disabled individuals.

As a result, tens of thousands of Atlantans are living in now-thriving neighborhoods that were once urban “war zones” with crumbling infrastructure, high crime rates, failing schools, and declining property values. As those housing projects have been razed and redeveloped as market-quality, mixed-use, mixed-income communities, Atlanta has flourished. Affluent and middle-class residents are moving in, and the city’s population recently topped 500,000. Crime decreased by at least 44 percent over the last decade, and billions of private dollars have been invested in the city.

Friday, December 18, 2009

NHC Urges Congress and the Administration to Approve “Cash for Caulkers,” a Program That Would Help Create or Save an Estimated 360,000 to 500,000 Job

Statement by NHC President and CEO Conrad Egan
"NHC applauds recent efforts to develop incentives for home energy-efficiency retrofits, and urges Congress and the Administration to work together to authorize a "cash for caulkers" program that would help to create jobs, improve residential energy-efficiency, and reduce carbon emissions and the consumption of limited natural resources. If funded at the proposed $20 billion, the program would create or save an estimated 360,000 to 500,000 jobs. Among other impacts, this innovative program would create direct jobs for local contractors, construction workers, and others in the construction industry, which saw an unemployment rate that reached 21 percent this year. By reducing utility costs for America’s families, it would also increase their spending power, creating additional jobs as those funds are spent.

In addition, by promoting investment in home energy-efficiency, the program would generate important environmental benefits. Energy Department statistics show that more modest home improvements undertaken through the Weatherization Assistance Program have helped to reduce national energy demand by the equivalent of 18 million barrels of oil each year. The proposed "cash for caulkers" program would magnify this impact exponentially, resulting in even greater environmental benefits.

The proposed program would also help to meet the needs of working families that earn too much to qualify for weatherization or utility bill assistance programs targeted to very low-income households, but too little to benefit from the relatively modest tax credits that are now available. This coverage gap, highlighted in a recently-released paper from NHC and its research affiliate, the Center for Housing Policy, leaves low- and moderate-income households with growing utility bills and few resources to improve the energy-efficiency of their homes.

Specifically, the program would provide a 50 percent rebate on eligible energy-efficient investments up to $24,000 for a maximum tax credit of $12,000. This is a very substantial incentive that will encourage families to undertake energy-efficiency improvements, putting hundreds of thousands of contractors back to work. While current proposals appear to limit the program to owner-occupied homes, extending eligibility to a broader range of housing types - both single- and multi-family and both renter- and owner-occupied homes - would increase the economic and environmental impacts of the program.

To magnify the impact of the proposal, the Administration and Congress should consider creating a loan guarantee or other mechanism to ensure the availability of up-front financing for the improvements, helping to make the tax credit accessible to working families that may not be able to afford the up-front costs of home retrofits. This would help speed implementation and promote needed job creation."
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About the Data in this Statement

Thursday, December 17, 2009

Despite Historic Drops in Home Prices, New Study Finds Housing Costs Are Actually On the Rise for America's Families

While the U.S. foreclosure crisis has resulted in a historic drop in home prices, a new Center for Housing Policy report released today reveals that housing affordability has actually worsened for America’s families. The report, entitled Housing Affordability Trends for Working Households, examines the relative affordability of housing for low- and moderate-income working owners and renters between 2005 and 2008. The report’s analysis finds that the share of working owners with a severe housing cost burden – that is, the share of households spending more than half their income on housing – rose from 18 to 20 percent during the three-year period studied. The share of working renters spending more than half their income on housing stayed essentially the same between 2005 and 2008 at approximately 22 percent.

One of the main reasons why home price declines have not improved housing affordability is that most homeowners have not moved since the foreclosure crisis started and, as a result, have not benefitted from the lower prices. Other reasons why housing affordability has worsened include: utility costs that have grown at more than double the rate of inflation, increasing housing payments due to adjustable-rate mortgages resetting, and an unemployment rate that began trending up in the last year of the time period studied.

Watch: In this video, the Center's Keith Wardrip, author of the report, provides an overview of the data, highlighting some of the most prominent trends.



Would You Like to Know How Affordable Housing is in Your Area?

Wednesday, December 16, 2009

GA Homeowners See Relief Through ANDP's Efforts to Account for Foreclosures in Property Tax Valuation Process

We would like to recognize NHC Member Partner the Atlanta Neighborhood Development Partnership, Inc. (ANDP) as a finalist for the NHC 2009 “Pioneering Housing Strategies” Award for its work in helping to account for foreclosures in the tax valuation process.

While foreclosed properties tend to negatively impact neighborhoods by driving down home values in an area, this is rarely taken into account when it comes to assessing property taxes. Prior to the work of ANDP, tax assessors in Georgia, as a matter of standard practice, did not include foreclosed or bank-owned sales in their property tax valuation process. To help address this disparity and provide relief to tax burdened homeowners, ANDP launched a research project with Robert Charles Lesser and Company (RCLCO), a highly-esteemed national real estate advisory firm, to quantify the gap between current market values and tax assessed values in 15 of Atlanta’s metro zip codes with the highest foreclosure rates.

The campaign produced two comprehensive reports and found that homeowners in the 15 highest-foreclosure zip codes risked overpaying property taxes by $71.6 million. In downtown neighborhoods where the median sales price was $49,900, the median tax assessed value was $140,900, resulting in a potential overpayment to individual homeowners of more than $1,400 annually.

These areas had high concentrations of minority, low-income, female-headed households and unemployed residents – those who could least afford an inflated tax burden. When ANDP repeated this analysis for sales in the second half of 2008, the overpayment risk climbed 66 percent to $118 million.

The analysis caught the attention of key legislators in the Georgia General Assembly. Informed in part by the ANDP and RCLCO reports, legislators introduced a successful bill mandating that tax assessors include foreclosed and bank-owned sales in the valuation process. In May 2009, the Atlanta Journal Constitution reported that assessors lowered property tax values on 350,000 homes in Metro Atlanta’s five-core counties.

ANDP’s successful efforts represent a timely approach to helping stabilize neighborhoods affected by foreclosure. ANDP’s Susan Adams spoke about these measures in a recent installment of the Federal Reserve Bank of Atlanta's Foreclosure Response Podcast series. Today, from Noon – 2 p.m. EST Adams will be on the HousingPolicy.org Forum answering questions related to the information in the Podcast. To learn more, please participate in today’s event!

Tuesday, December 15, 2009

Builders of Hope Honored With NHC 2009 "Pioneering Housing Strategies" Award - Innovative Organization Chosen for "Building Green Communities" Model

Today NHC announced that Builders of Hope, Inc. (BOH) was selected to receive the 2009 NHC “Pioneering Housing Strategies” Award for its work in helping to close an expanding gap between the availability and the need for safe, affordable and environmentally-friendly urban housing solutions in the Raleigh, NC area. Specifically, BOH was selected for its uniquely comprehensive Building Green Communities model, which includes its Extreme Green Rehabilitation process and related Work Mentor program. Watch this video to learn more about BOH and its mission.

Through its rehabilitation process, BOH recycles homes slated for demolition using green building standards and then sells them at cost to working families. The organization’s work program provides "green collar" and basic workplace competency job training to chronically unemployed populations, such as the homeless, ex-offenders and at-risk youth, in a full life-mentoring program – helping to contribute to the long-term revitalization and economic sustainability of each community in which BOH works.

Among the organization’s greatest achievements are its contributions to the environment. In 2008 alone, BOH saved more than two million pounds of construction debris from entering landfills. In addition, homes produced using the Extreme Green Rehabilitation model have passed both the North Carolina Healthy Built Homes and Advanced Energy’s SystemVision guarantee process. Ultimately, this means that these energy-efficient homes will be more affordable to owners over the long run with the money they will save on utilities. Additionally, in 2009, BOH was honored as a leader in sustainable development, receiving the City of Raleigh’s Environmental Stewardship Award.

Award Finalists


NHC would like to sincerely thank this year's award finalists, including the Atlanta Housing Authority, Atlanta Neighborhood Development Partnership, Bank of America, Enterprise Community Partners, Inc., Fairfax County Department of Housing and Community Development, Mercy Housing Chicago, Mercy Housing Idaho, Metropolitan Planning Council, NeighborWorks® America, Ohio Finance Housing Agency, Preservation of Affordable Housing, Inc., San Diego Housing Commission, and Stewards of Affordable Housing for the Future.

Beginning this week, NHC will be highlighting project and program submissions from each of the award finalists on “Open House” with its new blog topic entitled, “Pioneering Housing Strategies: NHC Members Making a Difference in Local Communities.”

About the Award

Established this year, the NHC “Pioneering Housing Strategies” Award was developed to replace the NHC "Excellence in Housing Communications" Award in order to recognize a broader range of creative activities. The honor acknowledges pioneering, forward-thinking strategies that are changing the way we approach affordable housing and community development initiatives.

The recipient of last year’s NHC "Excellence in Housing Communications" Award was BRIDGE Housing Corporation for its interactive "virtual municipality" BRIDGEtown, which showcases the organization’s mixed-use and mixed-income neighborhoods, providing a valuable framework for developers looking to create similar models in their own communities.

Monday, December 14, 2009

Live at the Forum: John O'Callaghan on ANDP's Neighborhood Stabilization Pilot Program

Don't miss out on today's "Live at the Forum" event with John O'Callaghan, president and CEO, Atlanta Neighborhood Development Partnership (ANDP), who will be discussing ANDP's neighborhood stabilization pilot program, which was recently outlined in an installment in the Federal Reserve Bank of Atlanta's Foreclosure Response Podcast series. Please see below for event details.
  • Part I - Listen to the Podcast: Make sure to listen to the "Piloting Neighborhood Stabilization Strategies" Podcast prior to participating in the online event.
  • Part II - Log on to the Forum: After listening to the Podcast, log on to the HousingPolicy.org Forum today from 2-4 p.m. EST. John O'Callaghan will be online to answer your questions about the pilot program. All questions should be posted to this thread by pressing the "Add Reply" button. You are welcome to post at any time leading up to or during the online Q&A session. Questions will be answered on a first-come, first-served basis until time runs out, so post early to be sure yours is addressed.
**Note: You will need to refresh your browser from time to time to see new responses as they are added.

About the Foreclosure Response Podcast Series
The Foreclosure Response podcast series is made available by the Federal Reserve Bank of Atlanta. Through interviews with experts on various facets of foreclosure - from neighborhood impacts to loan modifications to new strategies - listeners will be engaged in understanding the problems and advancing solutions. Each week, beginning September 24, 2009, and continuing for more than ten weeks, a new interview will be released. HousingPolicy.org is partnering with the Federal Reserve Bank of Atlanta to offer online Q&A with the speakers.

Friday, December 11, 2009

HUD Secretary Donovan Keynotes NYHC and NHC 36th Annual Awards Luncheon

U.S. Department of Housing and Urban Development (HUD) Secretary Shaun Donovan was the keynote speaker at the New York Housing Conference (NYHC) and National Housing Conference 36th Annual Awards Luncheon in New York City yesterday. He spoke of the foreclosure crisis facing the nation, as well as the solutions aimed at ending the crisis. In addition, Secretary Donovan emphasized the importance of balancing homeownership and rental housing policies, saying:

"Homeownership is incredibly important. But if this crisis has taught us anything, it’s that it is long past time we had a balanced, comprehensive national housing policy – one that supports homeownership, but also provides affordable rental opportunities, and ensures nobody falls through the cracks.

And with $10 billion in the Recovery Act for rental assistance, an increase of over $3 billion more in our FY 2010 budget request, and with $1 billion to capitalize the National Affordable Housing Trust Fund, let there be no doubt:

The Federal government is back in the business of rental housing.

But preventing a crisis of this magnitude from happening again is not just about HUD providing more federal resources or providing them more quickly.

It’s also about HUD being a resource – it’s about being a better partner."

Read Secretary Donovan's complete remarks and learn more about the NYHC and NHC 36th Annual Awards Luncheon

Thursday, December 10, 2009

Live at the Luncheon: Bob Lehrman & Carol Lamberg Highlight the NYHC and NHC 36th Annual Awards Luncheon

Today, NHC and its regional affiliate the New York Housing Conference (NYHC) hosted their 36th Annual Awards Luncheon, which honors those who have made New York a better place to live and work. To highlight the gathering, Luncheon Committee Chairman Robert Lehrman, Lodestone Banking Consultancy Inc., spoke about the significance of the event for all New Yorkers. In addition, NYHC Co-Chair Carol Lamberg, Settlement Housing Fund, Inc., outlined the unique relationship between the two affiliates, and how they work together to accomplish their shared goals -- both in New York and in Washington on the Hill. Check out each video below to learn more.

Bob Lehrman Details Significance of NYHC and NHC Awards Luncheon



Carol Lamberg Describes How NYHC and NHC Work Together as Affiliates

Tuesday, December 8, 2009

This Thursday: HUD Secretary Donovan to Keynote Prestigious NYHC and NHC 36th Annual Awards Luncheon

In just two days, on December 10, U.S. Department of Housing and Urban Development (HUD) Secretary Shaun Donovan will keynote the 36th Annual Awards Luncheon hosted by the New York Housing Conference (NYHC) and the National Housing Conference (NHC). This annual event, which honors those who have made New York a better place to live and work, is one of the largest gatherings of housing professionals in the nation – attracting more than 1,200 attendees each year.

As the keynote speaker, Secretary Donovan, formerly commissioner of the New York City Department of Housing Preservation and Development (HPD), will not only help celebrate the success of this year’s honorees, but will also focus on responding to the foreclosure crisis, the future of HUD and more.

The 2009 Luncheon also marks the inauguration of the Clara Fox Award for Outstanding Achievement. Named in honor of the legendary founder of NYHC, this first annual award will be bestowed upon Felice Michetti, who is the CEO of Grenadier Realty, one of the city’s largest private owners and managers of affordable housing. As HPD Commissioner during the Dinkins Administration, she is widely credited with implementing many of the housing development goals set by Mayor Dinkins’ predecessor, Edward I. Koch.

Additional award recipients include:
  • Nonprofit Housing Developer of the Year: Adam Weinstein, president and CEO, Phipps Houses;
  • Private Housing Developer of the Year: BFC Partners; and
  • Public Service Award co-recipients Priscilla Almodovar, former president and CEO, nyhomes, and Deborah Van Amerongen, commissioner, New York State Division of Housing and Community Renewal.
Please join us in honoring this year's award recipients, which have each played an integral role in helping ensure that New Yorkers have the opportunity to live in a decent, affordable rental or owned home in a suitable neighborhood.

For more information about this year's event, and to purchase tickets, please visit: NYHC and NHC 36th Annual Awards Luncheon.

Friday, December 4, 2009

Part II of II - Guest Blogger Nick Autorina: Maxims for Strategic and Successful NSP Implementation

Yesterday, "Open House" introduced you to seven of fourteen principles developed by Nick Autorina, managing director, Cobb County, Georgia CDBG Program Office, for helping to successfully implement a plan under the Neighborhood Stabilization Program (NSP). Today, we explore the remaining seven maxims, which are listed below.
  • When developing your business model, focus on the eligible activities under the NSP that are relevant to your jurisdiction! This eliminates unnecessary risk and prevents jurisdictions from wasting valuable time on activities that are not aligned with their business model or the expertise of their staff.
  • Understand the “dimension of the problem”: As a practitioner, realize that the NSP is fraught with peril because so many factors can impact the success of your program. From understanding the public policy side of the NSP, to ensuring your jurisdiction (both politically and the general public at-large) are educated on the goals and objectives of the program to understanding the underlying factors that can negatively impact your program such as: the continuing decline of the economy, lack of available credit (for potential homebuyers), competition for acquiring potential properties from private developers, or able inventory in your jurisdiction that is simply not congruent with your business model.
  • Understand risk. How will your business model “insulate” your jurisdiction in the event you cannot move your “acquired properties” to potential homebuyers? Does the jurisdiction assume the risk? Can they? Considering the economic plight most local and state governments are in at this time, does the reward justify the risk?
  • Have a relevant grasp of “supply and demand” as it relates to your existing housing inventory and your business model. For example, in Cobb County, we manage the “supply”-side by allowing our Asset Management Firm [AMF] to “hold” no more than five properties at anyone time. To minimize risk, we ensure the “demand”-side is always five to 10 times greater than the supply-side to allow more “potential” home-owner clients having a legitimate interest in our program and to allow those to get the requisite HUD counseling and get financially “prequalified” through a legitimate lending institution. This accomplishes two important concepts. It does not put “stress” on the AMF financially by forcing them to “carry” properties for an inordinate length of time and by “generating” a “surplus” of interest applicants, ensures that adequate qualified applicants have a portfolio of homes to choose from that understand the “value” in the program and the competitive advantage NSP has over a typical private-sector real estate transaction.
  • When designing your business model, ensure each step has complete “transparency” and an “arms-length” transaction. For instance, in Cobb County, Requests for Proposals were utilized for the Asset Management Finn [AMF], Appraiser, and Real-Estate Attorney. The inspection services are being provided “in-house” by the County. Each aspect of the program reports directly to the NSP Office and by doing this, ensures adequate controls are instituted at each level of every transaction that occurs.
  • Have an exit strategy. Understand that the market will dictate a large portion of the success and failure of the NSP. Have readily achievable goals and objectives that are analyzed quarterly. Be flexible in your thinking so your business model can adapt to the market! The only way to achieve this is by being proactive and responsive to the volatility that potentially exists in the current economic climate.
Nick Autorina was a guest speaker at the Solutions for Working Families: 2009 Learning Conference on State and Local Housing Policy, hosted by NHC and its research affiliate, the Center for Housing Policy, this past June, where he presented on this topic. He is also chairman of the Community Development Committee for the National Association of County and Community Economic Development.

Thursday, December 3, 2009

Part I of II - Guest Blogger Nick Autorina: Maxims for Strategic and Successful NSP Implementation

Nick Autorina, managing director, Cobb County, Georgia CDBG Program Office, has originated 14 maxims for successfully implementing a strategy under the Neighborhood Stabilization Program (NSP). Part one of this two-part guest blog feature includes one through seven of these key points. Tomorrow, "Open House" will feature the remaining maxims highlighting additional ways communities can manage NSP funds to rehabilitate neighborhoods.

Maxims for Building a Successful NSP Strategy:
  • Understand the “spirit and the intent” of the NSP law as it's written. As a jurisdiction, can you determine the causal connection between the regulations and your market's foreclosure situation?
  • Do you have the requisite, “in-house” capacity to handle this program?Once you established the causal connection, does your “Business Model” take into consideration the unique characteristics of your housing market? If you do not possess the capacity, determine the type of staff you want to hire to manage your program.
  • Real Estate Professionals are in abundance right now. Take advantage of this resource to help manage this process. They understand the market dynamics, are adept at strategic marketing, and have “built-in” relationships with lenders and have a better grasp of the “inertia” that typically exists in the housing market.
  • Have a relevant marketing strategy. Once the basis for the program is established for your jurisdiction, target those population segments for direct marketing efforts. This is a critical element every jurisdiction needs to be mindful of. If you treat the NSP funding like a typical federal grant, you will get overwhelmed. Because of this complexity and compressed time frames for implementation, jurisdictions must be flexible, aggressive, and sensitive to the markets in which they operate. This cannot be stressed enough!
  • Prepare and analyze financial models that are relevant to your housing market. Know what the market can “bear” and thoroughly understand the layering that will constitute each deal. Have parameters instituted that will allow your staff to quickly analyze a potential acquisition to see if it is financially viable.
  • When you factor in developer's fees, real-estate fees, closing costs, attorney fees, rehab costs, etc., you quickly realize that the “discounted” acquisition price will diminish once all fees are built-in for the final sales price.
Nick Autorina was a guest speaker at the Solutions for Working Families: 2009 Learning Conference on State and Local Housing Policy, hosted by NHC and its research affiliate, the Center for Housing Policy, this past June, where he presented on this topic. He is also chairman of the Community Development Committee for the National Association of County and Community Economic Development.

Tuesday, December 1, 2009

Bank of America Passes $1 Billion Mark in Loans and Investments to CDFIs As Part of Larger 10-Year, $1.5 Trillion Goal

Last Tuesday, Bank of America announced it had exceeded the $1 billion mark in loans and investments to more than 120 Community Development Financial Institutions (CDFIs) in 37 states. CDFIs are local institutions, such as credit unions, investment funds and niche banks, that focus on low-income and disadvantaged communities.

Bank of America's work with CDFIs is part of its 10-year, $1.5 trillion community development lending and investing goal – the largest ever established by a U.S. financial institution, which began in 2009 and is focused on affordable housing, small business/farm lending, consumer lending and economic development.

The impact of these investments and loans is tremendous. According to Opportunity Finance Network, CDFIs have provided more than $30 billion in capital to underserved communities. Annually, this financing assists more than 9,000 small businesses, 57,000 affordable housing units, and almost 700 new community facilities, including schools, child care centers and health care facilities, and helps create more than 34,000 jobs.

Monday, November 30, 2009

Administration's New Mortgage Modification Conversion Drive Kicks Off Today

Today, the U.S. Department of the Treasury and Department of Housing and Urban Development (HUD) kicked off a nationwide campaign to help borrowers in the trial phase of their modified mortgages under the Obama Administration's Home Affordable Modification Program (HAMP) convert to permanent modifications.

With tens of thousands of trial modifications being made each week, the Administration is now working to ensure that eligible borrowers have the information and the assistance needed to move from the trial to the permanent modification phase.
"We are encouraged by the pace at which trial modifications are now being made to provide immediate savings to struggling homeowners," said the new Chief of Treasury's Homeownership Preservation Office (HPO), Phyllis Caldwell. "We now must refocus our efforts on the conversion phase to ensure that borrowers and servicers know what their responsibilities are in converting trial modifications to permanent ones." Caldwell will lead HPO's conversion drive efforts.

"Encouraging borrowers to move through the process of converting trial modifications to permanent modifications remains a top priority for HUD," said HUD Assistant Secretary for Housing and FHA Commissioner David Stevens. "As a part of our continuing efforts to improve the execution of the HAMP program, HUD is committed to working with servicers, borrowers, housing counselors and others dedicated to homeownership preservation to improve the transition of distressed homeowners into affordable and sustainable mortgages."
The Mortgage Modification Conversion Drive includes the following measures:
  • Servicer Accountability;
  • New Web tools for borrowers; and
  • Engagement of state, local and community stakeholders.
To learn more about the Administration's mortgage modification program, please visit www.MakingHomeAffordable.gov.

Tuesday, November 24, 2009

Guest Blogger Steve Bancroft: Appraisal Issues a Major Problem

When I headed up the resale efforts in Houston on Resolution Trust Corp (RTC) residential properties back in the late 80s and early 90s the comps on appraisals of the RTC sales caused significant problems with purchase/rehab sales prices. We ended up doing a small percentage of “cost-appraisals” to produce comps to overcome the downward pricing problems of REO fire-sales.

In Detroit we are facing this issue again as we try to stabilize neighborhoods affected by foreclosure. It is complicated by the new appraisal process being mandated by the banks. This process requires a “fire-wall” between the initiator of the appraisal and the actual appraiser. In theory, that makes sense as it seems to promote a more objective, less-influenced result. In practice it has produced a disaster. The process has spawned a group of national appraisal clearing houses that arrange the local appraisals through networks they have created. Unfortunately the quality is extremely spotty due to the bargain-basement fees offered. In addition, the appraisers are essentially doing BPOs and even sometimes doing appraisals by e-mail from MLS Listings. We have seen appraisals on even new construction housing range from $29,000 from these “network” appraisers to $160,000 from local appraisers on a house that sold to an actual buyer at $130,000.

We are producing a local, “distress” Automated Valuation Model (AVM) in an effort to counteract these low-ball appraisals which are preventing what little mortgage credit that is available from actually being used. We have produced workable value in our AVMs, but are still in a process of getting them confirmed for use by banks.

I would love to know if others are experiencing this phenomenon and if so; how are you addressing it?

Steve Bancroft is the executive director of the Detroit Office of Foreclosure Prevention and Response. To learn more about foreclosure prevention and neighborhood stabilization initiatives in Detroit, please visit www.foreclosuredetroit.org.

Monday, November 23, 2009

New NAR Report Shows Existing Home Sales at Highest Level in More Than Two Years

According to a report released today by the National Association of Realtors, existing home sales in October reached their highest level in more than 2-1/2 years.

The report states that existing home sales rose 10.1 percent last month to a seasonally adjusted annual rate of 6.1 million units, up from the downwardly revised rate of 5.54 million in September. The numbers indicate that sales activity is the highest since February 2007, when the annual rate was 6.55 million.

The increase in home sales is assumed to be attributed to the $8,000 homebuyer tax credit, which was due to expire at the end of November, but has now been extended to April 30, 2010.

More

Thursday, November 19, 2009

New $500 Million Goldman Sachs “10,000 Small Businesses” Initiative Addresses Rising U.S. Unemployment that is Fueling the Foreclosure Crisis

Statement by Conrad Egan
President and CEO of the National Housing Conference
"We applaud Goldman Sachs for the launch of their new ‘10,000 Small Businesses’ initiative – a $500 million investment in jobs and economic development nationwide. Rising unemployment is fueling the current foreclosure crisis, devastating American families and communities. Small businesses employ more than half of U.S. workers and play an integral role in economic growth. Yet, only half of small businesses survive the first five years.

This new initiative is an unprecedented investment in small businesses, our communities and the future. Goldman Sachs’s overall investment includes $300 million in direct support to Community Development Financial Institutions (CDFIs), which will in turn offer both professional counseling and financial assistance to small business owners. CDFIs promote economic development in struggling communities underserved by traditional financial institutions and supply much needed access to capital.

Not only will this key initiative help small businesses and communities now, but it will also have catalytic results by leveraging additional resources, production and jobs over the long-term."
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Learn More About the "10,000 Small Businesses" Initiative

NeighborWorks Partners to Help Combat Mortgage Loan Modification Scammers

Today's Columbus Dispatch highlights a new, nationwide initiative led by NHC Housing Leadership Support Program Partner NeighborWorks America to combat scammers preying on homeowners seeking mortgage loan modifications.

Launched in October 2009, the Loan Modification Scam Alert Campaign was created to empower homeowners to protect themselves against loan modification scams, find trusted help and report illegal activity to authorities. NeighborWorks is working with national, state and local partners on the ground and 235 community-based affiliates to combat this issue.

The campaign's roll out in Ohio yesterday brought together local, state and federal officials to discuss the implications of the effort.
"We can't afford to wait any longer," said Kenneth Wade, executive director, NeighborWorks America. "Loan-modification scams have reached epidemic proportions. There are thousands of fraudulent companies out there making a mint. The best defense is information, education. That stops these scammers in their tracks."
The campaign is being promoted at the Ohio Housing Conference, one of the largest housing conferences in the country with more than 1400 industry professionals, which concludes today.

To learn more, or become involved with the campaign, please visit the Loan Modification Scam Alert Campaign Facebook Fan Page.

Wednesday, November 18, 2009

Guest Blogger Judy Jacobson: Making NSP Effective

When Congressman Barney Frank (D-MA) first said that he’d advance legislation to stabilize neighborhoods through the acquisition of foreclosed properties, those of us in Massachusetts working on this issue were thrilled. In Massachusetts we had already organized ourselves into a state-wide task force focused on all aspects of foreclosed properties: acquisition, funding, holding properties for redevelopment, and exit strategies. The task force resulted in products such as a $22 million revolving Neighborhood Stabilization Loan Fund and a statewide lender-owned properties REO clearinghouse that provides a “first look” in conjunction with the National Community Stabilization Trust.

When the Housing and Economic Recovery Act (HERA) passed in July 2008 we were well-poised to put the resources that Congressman Frank had fought for to good use. Or so we thought. Although our focus was simple and direct: support the acquisition and rehabilitation of foreclosed properties by responsible developers and homebuyers, we quickly found ourselves mired in the minutia of federal requirements, policy guidance and frequently asked questions. Following U.S. Department of Housing and Urban Development (HUD) Secretary Shaun Donovan’s appointment, and with Congressman Frank’s help, some of the more problematic Neighborhood Stabilization Program (NSP) rules were modified. But despite the word “Emergency” in the subtitle of HERA, it took over a year for NSP contracts to flow.

Our NSP buyers are now competing with investors with cash shopping the market for foreclosed properties. Whether these investor purchases are sustainable and will contribute to neighborhood stabilization remains to be seen. Clearly our NSP buyers are hamstrung with requirements. Does it really make sense to require a homebuyer of a foreclosed property to send a voluntary acquisition notice – the type of form more appropriately suited for a government acquisition – to the seller? Are we really still talking about whether a property that is transferred by a foreclosing lender to an affiliate still qualifies as “foreclosed”? HERA gave HUD enormous flexibility in implementing NSP with only four sacred cows: fair housing, nondiscrimination, labor standards, and the environment. HUD should quickly convene practitioners on the ground to scour the NSP rules and determine those that can be modified or eliminated.

It’s time to get serious about solving the problem of foreclosed properties and making neighborhood stabilization a reality.

Judy Jacobson is the deputy director and general counsel of the Massachusetts Housing Partnership, a statewide quasi-public agency that provides financial and technical assistance to promote the development and preservation of affordable housing. She can be reached at judyj@mhp.net. More information about MHP is available at www.mhp.net.

Tuesday, November 17, 2009

Live at the Forum: The Impacts of High Housing and Transportation Costs in the San Francisco Bay Area

This Thursday, November 19 from 2-4 p.m., the Center for Housing Policy will host its next "Live at the Forum" event to learn more about a new report from the Urban Land Institute's Terwilliger Center for Workforce Housing and the Center for Housing Policy, based on data from the Center for Neighborhood Technology, Bay Area Burden: Examining the Costs and Impacts of Housing and Transportation on Bay Area Residents, Their Neighborhoods, and the Environment. In addition to describing key findings from Bay Area Burden, this two-part event will allow you to get answers to your questions from the authors of the report by logging on to the HousingPolicy.org Forum. Presenters for this event will include: Keith Wardrip, Center for Housing Policy; Janine Cuneo, ULI Terwilliger Center for Workforce Housing; and Peter Haas, Center for Neighborhood Technology.
  • Part I: Hear About the Report -- This "Live at the Forum" event will begin at 2 p.m. EST (11 a.m. PST) with a 30-minute conference call with the presenters. The call-in number is (712) 432-1001 and the access code is 452746624#.

  • Part II: Interact With the Speakers -- Immediately following the call, from 2:30 – 4 p.m. EST (11:30 a.m. - 1 p.m. PST), the speakers will be online to answer your questions on the HousingPolicy.org Forum. Please note that you must be a registered user on the Forum to participate in this portion of the event.
About the Report
Bay Area Burden provides a comprehensive analysis of the “cost of place” in nine counties located throughout the San Francisco region by examining the costs and impacts of housing and transportation on residents, their neighborhoods and the environment. The report demonstrates the severity of the problem in the region and how the combined costs of housing and transportation are leaving San Francisco Bay Area workers with insufficient resources to meet their basic needs.

Monday, November 16, 2009

WSJ Letter-to-the-Editor: FHA Will Not Need to Ask the American Taxpayer for Assistance, Agency's Role is Integral to the Housing Recovery

On November 5, NHC President and CEO Conrad Egan submitted the below Letter-to-the-Editor to the Wall Street Journal in response to an article entitled, "FHA Digging Out After Loans Sour."
"In recent testimony before the U.S. House Financial Services Committee, Federal Housing Administration (FHA) Commissioner David Stevens emphasized that “based on current projections, absent any catastrophic home price decline, FHA will not need to ask Congress and the American taxpayer for extraordinary assistance [and] will not need a bailout” (“FHA Digging Out After Loans Sour,” Nov. 4).

In addition, many experts agree that the worst is over. Default rates on FHA loans made recently are not anticipated to be as great as previous loan defaults. The credit quality of recently FHA-insured borrowers has also gone from an average FICO score of 633 two years ago to 693 today, making the loans that the agency is insuring now less risky.

We must not forget that for 75 years FHA has played a pivotal role in the home financing system by providing single- and multi-family home loans to qualified borrowers that might not otherwise be able to secure a loan at a reasonable cost.

FHA does, of course, face a number of financial and capacity challenges, but the agency is more important than ever and remains integral to the housing recovery."
Just one week later, Commissioner Stevens and U.S. Department of Housing and Urban Development Secretary Shaun Donovan held a press briefing, which affirmed that with $31 billion in total reserves, the agency will not need to seek support from the American taxpayer under even some of the most extreme economic scenarios. Furthermore, FHA continues to fill a void in the market by insuring single- and multi-family loans to qualified buyers who might not otherwise be able to secure a loan at a reasonable cost. While the agency faces a number of challenges, it is currently implementing necessary reforms, including additional real-time monitoring of portfolio performance and delinquency, default and economic conditions, in order to help minimize risks to remaining capital.

To learn more, please view this NHC Statement:
Toll of Housing Crisis on FHA Reserves Illustrates Agency’s Pivotal Role in the Recovery

Friday, November 13, 2009

Guest Blogger Alan Mallach: The Investors Are Back – What Does This Mean for Neighborhood Stabilization?

The large-scale movement of investors back into the real estate market has become a major issue in a lot of cities trying to implement strategies under the Neighborhood Stabilization Program (NSP). It seems pretty clear that in many market areas prices have come down to where an investor can make a decent profit on the cash flow from buying units and renting them out, and gambling on some future appreciation down the road. Currently, 2 out of 5 sales in the Vegas and Phoenix metro areas are investor sales, and 1 out of 3 in Miami-Dade. Cities and community development corporations (CDCs) often simply can’t compete with investors, who are not bound by the NSP discount requirements, who don’t have to jump through elaborate paperwork hoops to make decisions, and can offer lenders quick, all-cash deals for their REO properties.

It’s not clear how to think about this – is it a good thing, because investors are absorbing properties that would otherwise sit empty, or is it a bad thing, because they are taking properties away from homebuyers or CDCs, who might generate better long-term outcomes for the properties and the neighborhoods? Probably some of both, but in any event, investors are not going away. It’s time public agencies and CDCs recognize that they are a long-term and important part of the local housing scene, and figure out how to work with them. That, in turn, may involve new public sector strategies. Yes, many communities could do more to discourage bad actors, but hammers are not usually very effective by themselves; we should also be thinking about incentives, to motivate investors to become part of the solution to the crisis our neighborhoods are facing. The question is, how?

Alan Mallach is a non-resident senior fellow at The Brookings Institution. His most recent book is A Decent Home: Planning, Building and Preserving Affordable Housing (Planners Press, 2009).

Thursday, November 12, 2009

FHA Audit Finds No Need for Taxpayer Support, Toll of Crisis on Agency’s Reserves Illustrates Its Pivotal Recovery Role

Statement by Conrad Egan
President and CEO of the National Housing Conference
"The Federal Housing Administration's (FHA) annual audit released today confirms that with $31 billion in total reserves the agency will not need to seek support from the American taxpayer under even some of the most extreme economic scenarios. Experts also emphasized that the toll the housing crisis has taken on FHA’s reserves illustrates the agency’s pivotal role in the housing recovery.

Specifically, as private lenders tighten their credit standards and capital sources are diminished, FHA continues to fill the void in the market by insuring single- and multi-family loans to qualified buyers who might not otherwise be able to secure a loan at a reasonable cost. Almost 50 percent of all first-time homebuyers in the housing market used an FHA loan in the second quarter of 2009 alone.

The agency has provided this same type of temporary support to the nation’s housing markets over its 75 year history, resulting in an eventual net positive return for taxpayers. Of course, with an increased FHA role there is initial financial risk, but many experts agree that the worst is over for the current crisis. Default rates on FHA loans made recently are not anticipated to be as great as previous loan defaults. The credit quality of agency-insured borrowers has gone from an average FICO score of 633 two years ago to 693 today, making the loans that the agency is insuring now less risky.

FHA does face immediate challenges and is currently implementing the necessary reforms. In particular, the agency is emphasizing risk management that includes additional real-time monitoring of portfolio performance and delinquency, default and economic conditions, in order to help minimize risks to remaining capital. FHA is also tightening rules for appraisals, streamline refinances and lender approvals to help prevent further erosion of and ensure increases in its financial reserves."

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For more information on the audit's findings, please view the following materials from today's briefing with U.S. Department of Housing and Urban Development Secretary Shaun Donovan and FHA Commissioner David Stevens:

Press Release

Press Briefing Presentation (PPT)

Tuesday, November 10, 2009

Recession's Effect on FHA, Agency Backed by Full Faith of Treasury Department

Today's Washington Post includes an article on the Federal Housing Administration's (FHA) soon-to-be-released annual audit, which, according to FHA Commissioner David H. Stevens, will appear dire because it offers only a snapshot of the agency's financial standing at the depths of the recession and does not take into account new loans the FHA will insure or has made to more creditworthy borrowers. In addition, FHA officials have assured Congress that the agency will not need a taxpayer bailout. FHA's complex funding mechanisms do not require the agency to turn to Congress if it cannot cover losses on loans because the agency has been drawing on money it deposited with the Treasury Department.
"It is absolutely a myth that they would have to go to Congress for money," said Marvin Phaup, a former budget analyst at the Congressional Budget Office and now a budget expert at Pew Charitable Trusts. "The FHA has permanent authority to get money from the Treasury because it is backed by the full faith and credit of the federal government."
Read More

Friday, November 6, 2009

HUD Secretary Donovan to Keynote Prestigious NYHC and NHC 36th Annual Awards Luncheon

On December 10, U.S. Department of Housing and Urban Development (HUD) Secretary Shaun Donovan will deliver the keynote address at the 36th Annual Awards Luncheon hosted by the New York Housing Conference (NYHC) and the National Housing Conference (NHC). This annual event, which honors those who have made New York a better place to live and work, is one of the largest gatherings of housing professionals in the nation – attracting more than 1,200 attendees each year.

As the keynote speaker, Secretary Donovan, formerly commissioner of the New York City Department of Housing Preservation and Development (HPD), will not only help celebrate the success of this year’s honorees, but will also focus on responding to the foreclosure crisis, the future of HUD and more.

The 2009 Luncheon is also particularly significant because it marks the inauguration of the Clara Fox Award for Outstanding Achievement. Named in honor of the legendary founder of NYHC, this first annual award will be bestowed upon Felice Michetti, who is the CEO of Grenadier Realty, one of the city’s largest private owners and managers of affordable housing. As HPD Commissioner during the Dinkins Administration, she is widely credited with implementing many of the housing development goals set by Mayor Dinkins’ predecessor, Edward I. Koch.

Additional award recipients include:
  • Nonprofit Housing Developer of the Year: Adam Weinstein, president and CEO, Phipps Houses;
  • Private Housing Developer of the Year: BFC Partners; and
  • Public Service Award co-recipients Priscilla Almodovar, president and CEO, NY Homes and Deborah Van Amerongen, commissioner, New York State Division of Housing and Community Renewal.
Please join us in honoring this year's honorees, who have each played an integral role in helping ensure that New Yorkers have the opportunity to live in a decent, affordable rental or owned home in a suitable neighborhood.

For more information about this year's event, and to purchase tickets, please visit:
NYHC and NHC 36th Annual Awards Luncheon.

Wednesday, November 4, 2009

New Report Finds the Average Bay Area Household Spends Nearly 60 Percent of Their Income on Housing and Transportation Costs Alone

Bay Area Burden, a new report released today by the ULI Terwilliger Center for Workforce Housing finds that the average Bay Area household spends more than $41,000 a year - nearly 60 percent of their income - on housing and transportation costs alone.

These costs vary among the nine Bay Area counties examined, ranging from 54 percent in Santa Clara to 66 percent in Sonoma. But the study finds that one fourth of all households in the Bay Area live in neighborhoods where housing and transportation costs account for 65 percent or more of income - a level defined as an extreme housing and transportation cost burden.

The report, produced in partnership with NHC's research affiliate the Center for Housing Policy and the Center for Neighborhood Technology, provides a comprehensive analysis of the "cost of place" in nine counties located throughout the San Francisco region by examining the costs and impacts of housing and transportation on residents, their neighborhoods and the environment. The report demonstrates the severity of the problem in the region and how the combined costs of housing and transportation are leaving San Francisco Bay Area workers with insufficient resources to meet their basic needs. The report finds that three fifths of all Bay Area residents live in communities that are unaffordable to households earning less than $80,000.

Two former Secretaries of the U.S. Department of Housing and Urban Development, who are now ULI Terwilliger Center Board members, Henry Cisneros and Steve Preston, attended a press conference today along with other Bay Area leaders, to announce the report, a new website at www.BayAreaBurden.org and cost calculator, all designed to bring greater awareness and understanding of these issues and their impact on communities. To view the media release, please click here.

Tuesday, November 3, 2009

Live at the Forum: Subsidized Housing Opportunities Near Transit for the 50+ Population

Tomorrow, November 4, NHC’s research affiliate, the Center for Housing Policy, will host its next two-part "Live at the Forum" event, which will feature a new report from the AARP Public Policy Institute, in collaboration with the National Housing Trust and Reconnecting America, "Preserving Affordability and Access in Livable Communities: Subsidized Housing Opportunities Near Transit and the 50+ Population." See details below to take part in this event.

Part I: Hear About the Report - The event begins at 2:30 p.m. EDT (11:30 a.m. PDT) with a 30-minute conference call, where major findings from the report will be presented by authors Allison Brooks, Reconnecting America; Rodney Harrell, AARP Public Policy Institute; and Todd Nedwick, NHC Member Partner the National Housing Trust. The call-in number is (712) 432-1001 and the access code is 498796833#.

Part II: Interact With the Authors - Immediately following the call, from 3 - 4:30 p.m. EDT, authors of the report will be online to answer your questions. All questions for the authors should be posted to this thread, and you are welcome to post at any time leading up to or during the event. Questions will be answered on a first-come, first-served basis until time runs out, so post early to be sure yours is addressed. To participate in this portion of the event, you must be a registered user on the HousingPolicy.org Forum.

Monday, November 2, 2009

Guest Blogger Ali Solis: Saving Our Neighborhoods With A Better NSP

Two years ago, we in the housing and community development field, began to notice the negative impacts of a sharp rise in foreclosures and vacancies in neighborhoods. To confront this problem, Enterprise, in partnership with Neighborworks, NHC, and other organizations, led the Save America’s Neighborhoods Coalition and worked with Congress to create the Neighborhood Stabilization Program (NSP). We were among the first to sound the alarm about the foreclosure crisis, and the past two years have sadly proven us correct. Foreclosures continue to ravage America’s neighborhoods, and the NSP funds are more important than ever.

Over its short history, NSP has undergone several modifications. We are proud to say that most of these changes, including an additional $2 billion for NSP2, resulted from an effective feedback mechanism by which practitioners on the ground communicate with advocates in Washington who work with staff at the U.S. Department of Housing and Urban Development (HUD) and in Congress. The result has been a much more workable and effective NSP.

However, NSP must still be improved. Redevelopment or rehabilitation of vacant properties cannot count toward the requirement that 25% of funds be spent on very low-income families. A simple legislative fix would allow localities to assist their very low-income populations with creative leveraging mechanisms such as LIHTC and other multifamily solutions. Similarly, HUD needs to permit the drawdown of sufficient funds to facilitate the use of loan loss reserve pools to better leverage NSP.

Therefore, as we implement NSP1, await the award of NSP2 and advocate for NSP3, we will continue to work with HUD and Congress to ensure that NSP is the most effective program possible. Our neighborhoods deserve nothing less.

Ali Solis is the senior vice president for public policy and corporate affairs for Enterprise Community Partners, a Housing Leadership Support partner of NHC. At Enterprise, Ali oversees the areas of public policy, communications, marketing and resource development.

Thursday, October 29, 2009

New Home Sales Take Dive Despite Recent Stabilization in Housing Sector

Despite news of recent stabilization in the housing sector, the Commerce Department released data yesterday revealing a tumble in new home sales. While analysts had predicted that sales would increase, new home sales fell 3.6 percent in September from the previous month after five consecutive months of rising activity.

Specifically, sales fell 11 percent in the West and 10 percent in the South; however, these decreases were partially offset by a 34 percent jump in activity in the Midwest.

Overall, sales were down 7.8 percent compared with September 2008.

Last week, an industry report brought good news, showing a 9 percent jump in sales of previously owned homes in September. New home sales currently account for approximately 8 percent of the market, down from 15 percent traditionally, according to the National Association of Home Builders.

Read More

Tuesday, October 27, 2009

Guest Blogger Sharon Price: Reflecting on Rhode Island's Creative and Effective Use of NSP Funds

Across the country, Neighborhood Stabilization Program (NSP) grantees and their partners are busy implementing their programs—working with mortgage servicers to purchase properties and with local partners to rehabilitate homes and secure new homeowners and renters. Under NSP1, HUD allocated $3.92 billion on a formula basis to 309 states, territories and local governments. The program was designed to stabilize communities across America hardest hit by foreclosures.

As a small state, Rhode Island received the minimum allocation for state grantees of $19.6 million. They have taken a number of creative approaches to utilizing their funds quickly and efficiently. Within the NSP guidelines, their statewide NSP plan set parameters for their grant funds which are being utilized in 11 communities. They began an NSP Homebuyer Assistance Program in targeted communities, and have already reserved all funds set-aside for that purpose. As this recent article shows, they are also rehabbing foreclosed properties in communities such as Warwick across the state through local partnerships between municipalities and nonprofits.

To learn more, please view the information below, which details how and where NSP funds are being used in Rhode Island.

Funds are targeted to areas:
  • With the greatest percentage of foreclosures;
  • Highest percentage of homes financed by subprime mortgage related loans; and
  • Identified as likely to face a significant rise in rate of home foreclosures.
Eligible activities include:
  • Establish financing mechanism for purchase and redevelopment of foreclosed upon homes and residential properties, including such mechanisms as soft-seconds, loan loss reserves, and shared-equity loans for low- and moderate- income homebuyers;
  • Purchase and rehabilitate homes and residential properties that have been abandoned or foreclosed upon, in order to sell, rent, or redevelop such homes and properties;
  • Establish land banks for homes that have been foreclosed upon;
  • Demolish blighted structures; and
  • Redevelop demolished or vacant properties.
Sharon Price serves as NHC's policy director.

Friday, October 23, 2009

NHC President and CEO Conrad Egan Honored With CHAPA Community Service Award

Yesterday, NHC President and CEO Conrad Egan received the Community Service Award from the Citizens' Housing and Planning Association (CHAPA) at their 42nd Annual Dinner and Meeting. The award recognizes individuals and organizations that have made significant contributions to furthering the goals of affordable housing over the long-term.

In addition to Egan, David Harris, managing director, Charles Hamilton Houston Institute for Race and Justice, Harvard Law School, also received a Community Service Award from CHAPA. U.S. Department of Housing and Urban Development Secretary Shaun Donovan gave a keynote speech at the event to recognize both the work of CHAPA and the award recipients.

About CHAPA
CHAPA is a non-profit organization for affordable housing and community development activities in Massachusetts. CHAPA’s mission is to encourage the production and preservation of housing which is affordable to low-income families and individuals.

Thursday, October 22, 2009

Guest Blogger My B. Trinh: Reflecting on Leveraged Funds

Tight credit markets are having a profound effect on community development practitioners and the communities that they serve. Now more than ever, effective use of public resources is critically important. It is perhaps time then, to reflect upon fund leveraging in recent years.

Leveraging public dollars can multiply the availability of capital in a particular market. For example, the New York City Acquisition Fund was created with $40 million from local government and foundation sources which was leveraged to raise over $190 million of lending capital from private institutions.

A recent study by Enterprise of the New York City Acquisition Fund and other leveraged funds revealed that they were able to provide a large number of acquisition loans at very favorable terms while supporting affordable housing objectives. It also revealed that a successful fund requires the following local factors:
  • City government support;
  • Takeout financing;
  • Foundation support;
  • Bank investment;
  • Ability to generate high loan volume;
  • Established CDFI partners; and
  • Housing development capacity in the target market.
However, recent changes in the market have slowed loan production. Facing lower loan volume, the New York City Acquisition Fund is seeking ways to alter the fund to provide resources for affordable housing preservation beyond the short-term acquisition loans that it already provides. The New Generation Fund in Los Angeles is also facing underutilization due to market conditions. It is seeking to reposition the fund to address the local issue of maturing acquisition loans on properties that cannot move forward with development due to the state’s fiscal crisis.

Leveraged funds have proven their ability to bring large amounts of capital into a market in the form of acquisition loans with very favorable terms. However, the market’s deterioration in recent years has demonstrated the importance of any given fund’s flexibility to ensure that it can be repositioned for maximum utility.

My B. Trinh is the Bart Harvey Enterprise Fellow 2008-2010. She recently completed an in-depth study of three acquisition funds designed to leverage capital for affordable housing development.

Wednesday, October 21, 2009

NHC and the Center for Housing Policy Announce Web 2.0 Suite Using Interactive Social Media Release

NHC and its research affiliate, the Center for Housing Policy, officially announced their Web 2.0 suite today via an interactive Social Media Release as part of an overall goal of encouraging affordable housing supporters to join them in connecting, sharing and exchanging ideas online. Specifically, NHC and the Center have worked to develop a host of new and social media tools that includes the NHC “Open House” Blog, the Center’s HousingPolicy.org Online Discussion Forum, as well as a strong and growing presence on YouTube, Facebook, LinkedIn, Twitter and Flickr.

In addition to "Open House," the HousingPolicy.org Online Discussion Forum has been integral in generating and sharing ideas among policymakers, practitioners and advocates, in particular, through its “Live at the Forum” series, which has focused on a number of timely issues such as stabilizing communities affected by concentrated foreclosures. To learn more about the Forum, check out the video below featuring the Center's Rebecca Cohen.



To help encourage use of new and social media tools by affordable housing advocates, NHC and the Center hosted a communications workshop and session on integrating Web 2.0 with traditional media strategies as part of the “Solutions for Working Families: 2009 Learning Conference on State and Local Housing Policy” held this summer.

Visit the full NHC and Center Web 2.0 Suite today!

Tuesday, October 20, 2009

Administration Announces New Initiative to Bolster HFAs, Help Distressed Borrowers, and More

Yesterday, as part of the Making Home Affordable program, the Obama Administration announced a new initiative to help strengthen state Housing Finance Agencies (HFAs) and their efforts to stimulate first-time home buying, help distressed homeowners and provide affordable rental homes for low- and middle-income borrowers over the long term.

This initiative, developed by the U.S. Department of the Treasury and the U.S. Department of Housing and Urban Development, in partnership with the Federal Housing Finance Agency, Fannie Mae and Freddie Mac, was created to maintain the viability of HFA lending programs and infrastructure. Specifically, this plan has two parts: a new bond purchase program to support new lending by HFAs, and a temporary credit and liquidity program to improve the access of HFAs to liquidity for outstanding HFA bonds.

According to an article in today’s Washington Post, the effort also reflects the priorities of the Administration and its increasing preference for moderate-size initiatives over another large stimulus program.

To learn more about this initiative, please view these documents and resources from NHC Member Partner the National Council of State Housing Agencies, which includes their statement written in support of these new measures.

Resources from Last "Making It Work" Webinar Now Available

On October 6, NHC, in partnership with Enterprise Community Partners, Inc., the Local Initiatives Support Corporation, the National Community Stabilization Trust and NeighborWorks America, hosted the last Webinar in the "Making It Work" series. This session focused on several techniques designed to capture quantitative and qualitative outcomes from community stabilization activities. In particular, the panelists also talked about traditional and creative measures needed to help practitioners meet reporting requirements and "tell their story."

Presenters included:
  • Michael Schramm, Center on Urban Poverty and Community Development, Case Western University;
  • Chris Walker, Local Initiatives Support Corporation; and
    Nancy Kopf and Jessica Anders, NeighborWorks America.
For more information on this session, please see this thread on the HousingPolicy.org Forum.

Monday, October 19, 2009

Part II of II: Guest Blogger Paul Graziano - HOPE VI and Beyond, The Baltimore Experience

HOPE VI brought a critical mass of blight elimination and new community building to spark major economic development in Baltimore. However, a larger and more flexible program is urgently needed to address broader community issues beyond the boundaries of a public housing site and to encourage community and economic development including addressing distressed Federal Housing Administration (FHA) multifamily properties, which often co-exist near deteriorated public housing sites.

In Northeast Baltimore, one such transformation is well underway where a functionally obsolete public housing site (Claremont Homes) and a severely distressed FHA property (Freedom Village) were replaced by a mixed income community. Due to the lack of HOPE VI funds, a variety of funding sources were cobbled together including the now moribund FHA Upfront Grant, Low-Income Housing Tax Credit, project-based Section 8 vouchers, HOME and State Development Funds, as well as state infrastructure funds.

Transformation stories like Baltimore’s have been replicated throughout the nation. Arguments still rage about the success of HOPE VI and especially the fate of residents. Whether more could or should have been done for the former residents of public housing will be long debated. What is indisputable is that no man, woman or child should have to live in the nightmare world of pre-HOPE VI public housing. What is also indisputable is that HOPE VI in Baltimore has been a major catalyst for broader transformation. A larger more flexible program would build on the success of HOPE VI.

Paul Graziano serves as the commissioner of Baltimore Housing. This entry is the second in a two-part series of posts by Comissioner Graziano. You can read his first entry here.

Friday, October 16, 2009

Multi-Housing News Magazine to Cease Publication at Month’s End

Yesterday, NHC learned that Multi-Housing News Magazine (MHN) will cease publication on October 30, 2009. As a go-to source for those in the multifamily housing industry, this is particularly sad in light of enhanced initiatives at the federal level to encourage the preservation and development of affordable rental housing in the U.S.

Despite a slimming of the magazine over the past few years, MHN is to be applauded for working to increase their online presence by featuring exclusive editorial content and videos on their Web site, as well as by using social media tools like Facebook, Twitter and LinkedIn.

Thursday, October 15, 2009

Part I of II: Guest Blogger Paul Graziano - HOPE VI and Beyond, The Baltimore Experience

In the recently published From Despair to Hope, Secretary Henry Cisneros recalls his visit to Lexington Terrace in Baltimore, where he and then Mayor Kurt Schmoke were urged by the police not to enter one of the high rise public housing buildings as their safety could not be assured. He was appalled at the thought that a Mayor and the highest-ranking housing official in the nation could not (even with a police escort) safely enter a building that young mothers with their small children were expected call home. This experience brought into focus the urgency of implementing the recently enacted HOPE VI program.

Unfortunately, the situation at Lexington Terrace was not unique either in the city or the nation. Downtown Baltimore was encircled by a ring of high-rise family public housing sites, each with comparable levels of deterioration and despair.

Through more than a decade of hard work and with a huge assist from five HOPE VI grants and over $60 million in special state funds, this aggregation of misery has been replaced with five new mixed-income communities where public housing residents now live in secure, clean, and well-managed homes. In addition, over 2000 former residents have been or will be able to relocate to low-poverty communities of opportunity utilizing a scattered-site development program and Section 8 vouchers with extensive counseling.

HOPE VI brought a critical mass of blight elimination and new community building to spark major economic development in Baltimore. In East Baltimore, a land swap between the Housing Authority Baltimore City and Johns Hopkins related to the Broadway HOPE VI project (featured on page two photo in Cisneros’ book) enabled Hopkins to move forward with over $1 billion worth of investment. This effort has been buttressed by the $1.8 billion mixed-use East Baltimore Development Initiative on 88 acres to the north.

In West Baltimore, the redevelopment of two public housing sites, including the infamous Lexington Terrace, encouraged the University of Maryland to undertake its own BioPark. This was the first major expansion across Martin Luther King Boulevard, which historically demarcated the end of the Central Business District.

Paul Graziano serves as the commissioner of Baltimore Housing. This entry is the first in a two-part series of posts by Comissioner Graziano. You can read his second entry here.

Wednesday, October 14, 2009

Video Highlights "From Despair to Hope" Discussion in Atlanta

In late August, more than 200 people gathered in Atlanta, GA, to participate in a community discussion as part of an event celebrating the publication of From Despair to Hope: Hope VI and the New Promise of Public Housing in America's Cities, which was co-edited by Lora Engdahl and former U.S. Department of Housing and Urban Development Secretary Henry Cisneros, chairman, NHC Member Partner CityView.

Specifically, the event in Atlanta showcased the chapter authored by Renee Glover, president and CEO, NHC Member Partner the Atlanta Housing Authority (AHA), about the success of housing assistance reform in Atlanta.

AHA recently released a video highlighting the event, which can be viewed below.

Friday, October 9, 2009

World Habitat Day-Related Event Presents Findings from Report on Mission Entrepreneurial Entities

Yesterday, NHC, in partnership with NHC Member Partner the Housing Partnership Network and the Affordable Housing Institute (AHI), hosted a World Habitat Day-related event covering a new study, Mission Entrepreneurial Entities (MEEs): Essential Actors in Affordable Housing Delivery, which examines the characteristics of MEEs, their role and importance in housing delivery, and their principles of success.

MEEs are defined as private companies – usually nonprofit housing companies – whose focus is on change-making that involves developing sustainable organizational and financing infrastructure for the creation of affordable housing. By converting ideas and resources into tangible results, in the form of successful housing developments and outcomes, these organizations play an important part in developing communities and also serve to influence change in both policy and economic realms.

Panelists for the event included:
  • Gaynor Asquith, principal, arc4 Consulting, Manchester United Kingdom;
  • Thomas Bledsoe, president, Housing Partnership Network;
  • Ray Christman, former CEO, Federal Home Loan Bank of Atlanta;
  • Carol J. Galante, deputy assistant secretary for multifamily programs, U.S. Department of Housing and Urban Development;
  • Michael Pitchford, president and CEO, Community Preservation and Development Corporation;
  • Debra Schwartz, director of program related investments, John D. and Catherine T. MacArthur Foundation; and
  • David Smith, CEO, CAS Financial Advisory Services (moderator)

If you missed the presentation, or would like to view information from the study, please see the resources below.

MEE Study Presentation
MEE Report Extracts and Selected Exhibits

More About World Habitat Day
The United Nations has designated the first Monday of October every year as World Habitat Day, with the idea being to reflect on the state of our towns and cities and the basic right of all to adequate shelter. The day is also intended to remind the world of its collective responsibility for the future of the human habitat.

Thursday, October 8, 2009

Bring Workers Home: 2009 Eastern Regional Forum on Employer-Assisted Housing

Employer-assisted housing (EAH) is often described as a win-win-win tool because employers, employees and the community each benefit. As the nation continues to seek solutions to the housing crisis facing our country, EAH presents itself as one proven tool to help recruit and retain productive, stable workforces and revitalize and stabilize neighborhoods.

If you’re interested in learning more about EAH and are located in the Eastern region, then mark your calendar and plan to join your colleagues on Thursday, November 19 from 10:00 a.m. to 3:00 p.m. for a one-day, complimentary forum entitled “Bring Workers Home: 2009 Eastern Regional Forum on Employer-Assisted Housing,” hosted by the National Association of REALTORS® and the National Housing Conference in Philadelphia, PA.

The goal of the forum is to expand awareness of EAH as a proven housing solution among state and local leaders—including REALTORS®, REALTOR® association staff, business leaders, state legislators, city council members, other elected and appointed officials, and human resource and employee benefit professionals. This regional forum will also provide learning opportunities for housing planners, economic & community developers, practitioners and advocates.

Speakers for the event include:
  • Joe Canfora, NAR Regional Vice President for Region 2
  • Ed Collins, New Jersey Housing and Mortgage Finance Agency
  • Peter Elkowitz, Long Island Housing Partnership
  • Jim Flaherty, City of Philadelphia Commerce Department
  • Cynthia Karnai-Crossan, Delaware State Housing Authority
  • Dr. Lucy Kerman, Greater Philadelphia Urban Coalition
  • Mayor Michael Nutter, City of Philadelphia (invited)
  • Sharon Price, National Housing Conference
  • Ed Robinson, The Maryland Real Estate Team
  • Robin Synderman, Metropolitan Planning Council
  • Steve Wing, CVS
In addition, real estate professionals can maximize their regional forum experience by participating in the complimentary Home from Work™ continuing education credit class on Wednesday, November 18 from 1:00 PM to 4:00 PM, just one day prior to the main event. This class will outline the benefits of EAH and explain how to work with employers to assist them in implementing an EAH benefit plan at their workplace.

To attend one or both of these free events, make sure to Register Here. Please note that registration will close on October 30.

For more information, please contact Lynn Ross at the National Housing Conference at lross@nhc.org.