Thursday, September 18, 2014

Growing the housing movement

by Maya Brennan, National Housing Conference

With more than 80 years behind it and countless more ahead, the affordable housing movement is rich with NHCers, as our esteemed Conrad Egan collectively calls NHC staff. NHCers know the important role that safe, decent, and affordable housing plays in our lives. We know that the housing movement needs options for all income levels, communities, and needs. And we know that solving the nation’s affordable housing challenges is possible.
Maya moderating at NHC's Veterans Housing Convening.
She will be missed!

We can solve the nation’s housing challenges by strengthening and growing the housing movement. Housing has a place on every policy agenda from transportation to health, aging to child wellbeing, veterans to disasters and emergency management. Safe, decent, and affordable housing meets human needs, grows economies, improves health and wellness, supports children’s education, enriches quality of life as we age, and helps individuals plan for and reach financial goals.

Since I joined NHC as a research associate in January 2007, I have had the privilege of working on all of these issues and more. Now I am ready to pass the baton to the next energetic and thoughtful housing researcher. Help grow the housing movement by applying for a job on NHC’s research team. Or join NHC or the Young Leaders in Affordable Housing at a membership level that’s right for you. 

As with all departing NHCers, I will take with me not just a box of mementos but a wealth of knowledge and a vision for the future. Together we can strengthen housing solutions and improve opportunities for people and places to thrive.  

Tuesday, September 16, 2014

Problems and promise in HUD single family loan sale program

By Rebekah King, National Housing Conference


HUD has released its first report on the performance of loans in the Single Family Loan Sale (SFLS) program. This report highlights some of the program’s successes but also suggests some concerns as the program moves forward. FHA is managing the conflicting objectives of improving its balance sheet to meet congressional demands while serving borrowers and preventing foreclosures. In the last year, FHA has been under tremendous pressure from Congress to address its losses and improve overall performance, as Ethan Handelman discussed in an earlier blog post. FHA’s achievements are noteworthy and should not be discounted. They should also not be accepted as sufficient, when FHA could do more to improve borrower outcomes while still meeting its goal of financial stability.


HUD has been selling the most delinquent loans guaranteed by the Federal Housing Administration (FHA) to private investors. HUD sells the loans at a discount, so private buyers are better able to make loan modifications. Investors who purchase loans from FHA are typically prohibited from foreclosing until at least six months after the purchase. Beginning in 2012, FHA expanded the program and created two pools, national pools and neighborhood stabilization outcome (NSO) pools. The NSO pools are a concentration of loans in hardest-hit areas, and buyers are required to achieve positive and stabilizing outcomes for 50 percent of the loans in the pool. This could include loan re-performance (where the borrower was at least 90 days delinquent but is making loan payments again), becoming a rental, or gifting to a land bank among other options.


This program has received media attention in the last week, highlighting the program’s successes as well as some concerns.


Successes:

  • The program can help borrowers either avoid foreclosure through a short sale or deed in lieu, or allows borrowers to get loan modifications and remain in their homes.
  • FHA loss rates have declined from 63.5 percent in first quarter 2010 to 52.9 percent in second quarter 2014.
  • Bids on these loans have improved from 40 percent of the unpaid principal balance (UPB) to 60 percent.
  • Resolved loans in the NSO pools have achieved a 23.5 percent loan re-performance rate and avoid foreclosure for 58 percent of borrowers.
  • Only one percent of loans in NSO pools have been sold to other investors.
Concerns:
  • 98 percent of all loans have been sold to for-profit investors; only 2 percent of loans have been sold to nonprofit organizations.
  • Almost one-third of loans in the national pools have been resold to other investors; reporting requirements do not stay with the loans so the outcomes for these borrowers are unknown.
  • Borrower outcomes are much better in the NSO pools than in the national pools, but only 20 percent of loans have been sold through NSO pools.
  • Bids are increasing, making it more difficult for nonprofits to participate in the program.
  • To be eligible, loans must exhaust all FHA loss mitigation options, but FHA does not have a way to ensure this before loans are sold.
Significance:
  • FHA still has approximately 500,000 delinquent loans which could be sold.
  • Fannie Mae and Freddie Mac are also starting to sell their nonperforming loans.
  • Growing interest in bonds backed by nonperforming loans, so there is less interest in borrower outcomes and avoiding foreclosure.
  • Some investors are only interested in foreclosing the nonperforming loans to create rental portfolios, which means less focus on borrower outcomes.
  • No requirements on the national pools means no incentive to pursue positive borrower outcomes.

In summary, the Distressed Asset Securitization Program (DASP) is meeting its goal to help FHA financially. Borrowers are also seeing some benefits from the program. However, the program could provide a greater positive benefit to homeowners. FHA could make minor changes to the program to make it more borrower-focused while still benefiting their bottom line, which the Center for American Progress highlights in greater detail in its report. NHC is pleased that FHA has already announced some changes to the program including beginning to audit loan eligibility decisions by servicers, putting more loans in NSO pools, creating smaller pools and allowing buyers more time to assemble capital. NHC hopes that FHA will continue to seek ways to improve the program balance and serve both goals, helping FHA financially and assisting borrowers and communities.

Tuesday, September 9, 2014

Even grandmothers get the (NIMBY) blues

by Amy Clark, National Housing Conference

This morning I discovered this story on opposition to an affordable senior housing development built by National Church Residences in St. Louis County, Mo. via the Twitter feed of the Urban Institute’s Erika Poethig (note to all: if you’re not on Twitter, you’re missing out). Housing advocates often see older adults (along with children and people with disabilities) as the “sacred cows” of community acceptance: who could object to Grandma moving in next door?

But what appears to be a minority of Oakville residents found a way. For those who follow trends in community opposition, the objections raised will sound familiar:
  • The county did not provide adequate notice or comment opportunity prior to development. 
  • The building is too large for the land on which it’s sited. 
  • Fear of crime—not caused by the residents themselves, but by grandchildren of the residents. 
  • The building’s proximity to a school. 
  • Its potential impact on traffic congestion. 
When even senior housing meets with vociferous objection, is there any hope for the housing community? There sure is. Research by NHC and the experience of housing practitioners provides us with techniques communities can use to help counter opposition in the future. Some examples:
  1. Have the meeting before you have the meeting. Jurisdiction-mandated community notification processes are important, but before public meetings happen, developers and their allies (including those in local government) should meet with key community influencers and interest groups to learn of concerns at the very start of the approval process, providing timely intelligence and the opportunity to build support early on. 
  2. Drop the open mic. An open mic-style meeting gives all comers the opportunity to speak, but it also puts the loudest voices in charge of the conversation. If local regulations permit, host public meetings using formats that give all voices and viewpoints a chance to be heard. And facilitation must be done in good faith; all participants should come away feeling their perspectives were really heard. Meetings with small-group discussions can present great opportunities for public education as well. 
  3. Jurisdictions must step up. Building community acceptance isn’t just the job of the developer or nonprofit sponsor. Local governments can and should play a role in building pathways to community support for affordable housing. After all, it may be the developer doing the work, but those affordable homes are being developed in service of a broader public policy goal. Government officials can aid developers in planning community acceptance strategies from the outset, and be available throughout the process to answer community questions and share how a single development fits into the jurisdiction’s broader affordable housing goals. 
  4. De-politicize the process. Jurisdictions can put civil servants in charge of final approval of affordable housing developments instead of elected officials or appointed boards or commissions. Input and advice from all parties can be valuable, but putting the final decision in the hands of a local government employee takes politicking out of the equation. 
I’m sure our friends in St. Louis County did everything they could to ensure a successful development process, and changing the way we talk about housing itself will go a long way to building community acceptance as well. This post is just the tip of the iceberg. But the more we’re able to employ community acceptance best practices in development today, the easier it will be to build the housing our communities need down the line. Have your own community acceptance story to tell? Share it on the Housing Communications HUB.

Wednesday, September 3, 2014

Words matter

by Chris Estes, National Housing Conference


September is finally upon us, which means the beginning of the season of affordable housing forums, conferences and convenings. At NHC we are set for our busiest fall ever!

On Sept. 11 NHC will host a Veterans Housing Convening at the Ronald Regan Center here in DC. This event will focus on rental housing in particular and will feature research presentations from the National Low Income Housing Coalition, League of Cities and NHC’s Center for Housing Policy, best practices in veterans housing communications and a discussion of policy recommendations to increase the supply of affordable rental housing for veterans. As I have noted before you can watch a webcast of the convening if you cannot attend in person. Please visit our website for more information and to register.

NHC is proud to be a sponsor and presenter at the Bipartisan Policy Center 2014 Housing Summit on Sept. 15 and 16. The summit brings together a wide array of housing experts and promises to be an important catalyst for housing policy dialog for the coming year. As Amy Clark notes below, we’re partnering with the BPC to present an invitation-only messaging workshop as part of the summit. Visit the BPC website for more information on the summit and how to register.

NHC focuses on being a resource on values-based messaging and other effective communications strategies. We believe there is a causal relationship between the difficulty the affordable housing community has had in building support for policy and funding solutions and how we talk about the work we do and the people with serve. Sometimes new frames suddenly arise that seem like useful opportunities to build support but may in fact increase negative stereotypes in the long run. One of these examples is the discussion of the separate entrance, or “poor door,” in a New York City development created under that city’s inclusionary housing program. Center for Housing Policy senior research associate Robert Hickey writes about this issue on the NHC Open House blog. Come share your thoughts on the issue as an advocacy opportunity as well as its implications for inclusionary programs across the country.

Another topic dominating the national news is the uprising in Ferguson, Mo., after the police shooting of an unarmed African-American teenager. While such situations bring decades of racial and economic discrimination to the forefront, it can be difficult to transform what we know into a path forward for communities like Ferguson. Ethan Handelman writes about the housing policy implications in this month’s Policy Corner. Please read and share your thoughts with Ethan about where this discussion can go.

We look forward to a very busy fall with many events and webinars that will provide real value to your work. We continue to try and make NHC the best resource for the affordable housing community. Be on the lookout for a survey for NHC members on what you need and how we’re doing. 


San Diego Housing Commission to provide families with special needs housing options

News from NHC's family of members
by Radiah Shabazz, National Housing Conference 


Recently NHC member San Diego Housing Commission and its partner, Chelsea Investment Corp. announced that it will be constructing affordable rental housing for families who have a developmentally disabled member. Independence Point will feature on-and-off-site services that will contribute to the ability of residents to be self-sufficient and contain three-and-four-bedroom units for families with incomes at or below four set incomes levels as determined by area median income in San Diego.

The three buildings that will make up Independence Point will be located in the county’s fourth council district and will feature a community that is in walking distance to John F. Kennedy Park, two schools, retail stores and a grocery store. Rental in Independence Point will be affordable to families with incomes as low as $23,000 per year.

“This townhome development for families with a developmentally disabled loved one lives up to the San Diego Housing Commission’s motto—‘We’re About People,’” said San Diego Housing Commission’s Vice President of Housing Finance and Development, Ann Kern, in a press release. “It’s incredible that this development is going to assist [families with a developmentally disabled member],” she continued.

Federal assistance for special-needs housing is crucial, as revealed in data released in July by HUD’s Office of Policy Development and Research, which shows that 34 percent of households receiving federal subsidies include a person with a disability. NHC Vice president of Research Lisa Sturtevant analyzed the data in a blog post to reveal how necessary federal assistance is for helping to provide affordable housing to needy families.

Construction of Independence Point is expected to be completed in a year.  


New permit allows City of Minneapolis to build 1400 single, multi-family units

News from NHC's family of members
by Radiah Shabazz, National Housing Conference


NHC member City of Minneapolis Department of Regulatory Services recently announced its approval for over $1 billion in funding for various citywide construction projects, including over 1,400 single family and multifamily units. Approval of the projects marks the third straight year Minneapolis’ funding has exceeded $1 billion.

Most of the construction projects will take place in the downtown area, where a multipurpose stadium and mixed-use development will be erected. Rental housing options are also thriving in the area, where in addition to construction of new units, older buildings will be converted and updated. In total, 1,488 homes, apartments and condominiums will be constructed.

“We are entering a period of growth in our city and today I am excited to provide evidence that Minneapolis is entering it sooner than most,” said Minneapolis Mayor Betsy Hodges in a press release. “Driven by a high level of investment in commercial development, including the new stadium, and multi-family housing developments, the $1 billion in construction permits approved so far this year, speaks to our commitment to working towards creating a more vibrant Minneapolis that attracts increased investment and residents alike to the city.”

Minneapolis’ work to ensure that funding is available for the creation and maintenance of affordable housing developments will help easing the housing cost burden that 12 percent of households in the area face.  Our February report, Housing Landscape 2014, analyzed data from the American Community Survey to detail housing affordability challenges families face across the nation, revealing that 15 percent of Minneapolis’ low- and moderate-income households spend at least half of their income on housing costs, compared to a national average of 16 percent. The construction of new affordable housing developments will help to ease the cost-burden and make affordable housing that much more attainable for Minneapolis residents.

In addition to the single family and multifamily housing units, the funding will cover construction of a new Minnesota Vikings football stadium and student housing options. The city has many development submissions still pending, so it is likely that new constructions projects will exceed $2 billion.


Habitat for Humanity advocates for continuation of SHOP funds

News from NHC's family of members
by Radiah Shabazz, National Housing Conference


The FY 2015 House appropriations bill is threatening the funding for the Self-help Homeownership Opportunity Program (SHOP) and NHC member Habitat for Humanity is advocating to ensure funding for the program is not ended. The SHOP program, distributed by HUD, works with self-help organizations like Habitat for Humanity to promote homeownership for low-income families. The program awards funding to organizations through a competitive application process where the recipient must be able to demonstrate how the funding will be used for infrastructure improvement or land acquisition.  Both the House bill and the President’s budget proposed cutting the separate funding for SHOP and instead moving it to be one of many possible uses under the HOME block grant program.

Habitat for Humanity of Greater Nashville, a program affiliate of Habitat for Humanity International, offers a proven example of the program’s benefits. Since 2002, HFH Nashville has served nearly 1,000 children and adults and sold 314 affordable homes to low-income families. The organization has also generated over $17.7 million in real estate values in its communities, along with over $2 million in local property taxes paid by Habitat homeowners.  

“SHOP has helped Habitat serve thousands of families using the self-help, sweat-equity model that requires families to commit substantial time to constructing their own homes,” said Christopher Ptomey, Habitat for Humanity International’s director of federal relations. “SHOP addresses the growing housing crisis in the U.S. while providing unique value to all of us as taxpayers. The President’s budget and the FY 15 House T-HUD appropriations bill propose to eliminate this essential program – and that’s unacceptable.”

Protecting funding for vital housing programs is a major policy agenda item for NHC and our members. In January, we joined others in the HOME Coalition in a letter to HUD advocating for increased FY 2015 funding for the HOME block grant program, which funds rental housing, homeownership, and rental assistance tailored to meet state and local housing needs. In that letter, we advocated for preserving separate funding for the SHOP program rather than taking it out of the already-reduced HOME allocation.

Habitat for Humanity International and Habitat affiliates encourages supporters of affordable housing to sign an online petition asking lawmakers them to support funding for the SHOP program. Habitat also encourages supporters to use social media to communicate the need for the program by using the hashtag #SHOP.