The affordable housing industry is a vital part of the U.S. economy, with developers across the country helping create and supply cost-effective living arrangements for many different types of people. As an affordable housing developer yourself, you know that each deal brings a whole new set of challenges, and that changes on both a state and federal level can have a significant impact on the sector.
As a member of the affordable housing industry, you naturally care about the trends that will likely affect your business. Since you have a host of other responsibilities, we’ve dedicated a portion of our time to keeping an eye on trends within the affordable housing industry, including the news that the demand for affordable housing has rarely been higher.
Here is what we’ve learned while watching the news surrounding the affordable housing industry:
More Americans desire quality, affordable housing
Over the past several years, the U.S. has been hit hard by a floundering economy. Conditions have begun to improve recently, but many Americans are left waiting for their personal finances to take a turn for the better.
In fact, more than half of all U.S. adults have had to give up something of value in order to make a monthly rent or mortgage payment, according to a survey conducted by the MacArthur Foundation. This includes finding a second job, putting off saving for retirement or piling up credit card debt. While many economists feel that the country has emerged from this recent recession, 70 percent of survey respondents believe that we are still in the middle of the crisis – or that the worst part lies ahead of us.
The MacArthur Foundation discovered that demand for affordable housing is high. Unfortunately, 58 percent of the survey participants noted that it is very or somewhat challenging to find affordable housing in their communities, while 58 percent feel that the government can do more to create additional affordable housing units for sale or rent.
HUD funding gains steam in Congress
Few government entities do more for the affordable housing industry than the U.S. Department of Housing and Urban Development (HUD). Over the past several months momentum has increased for a bill that would address funding for the 2015 fiscal year, including the portion covering HUD Section 8 project-based rental assistance.
In late May the U.S. House of Representatives passed the legislation, which includes a funding level of more than $52 billion, the National Council of State Housing Agencies reported. While on the surface that is an increase compared to FY 2014, it is technically less due to changes with receipts available from the Federal Housing Administration (FHA). Nearly $10 billion has been allotted for project-based Section 8, on track with President Barack Obama’s recommendation and $171 million below the amount for FY 2014. In addition, more than $2 billion has been set aside for homeless assistance grants, unchanged on a year-over-year basis.
“This bill focuses funding on the infrastructure that grows the American economy and on the housing options that protect our most vulnerable citizens,” House Committee on Appropriations chairman Hal Rogers (R-KY) said in a statement. “These investments are important to our economic growth, important to the safety of our citizens, and important to those people who might worry about whether or not they will have a roof over their heads tomorrow.”
Affordable housing landscape changing
The landscape surrounding the affordable housing industry is constantly changing. Due to this, developers and other professionals such as yourself have to stay up-to-date with the current industry trends in order to win awards and generate new developments for your company.
At Clark Schaefer Hackett, we have the knowledge and skills to help you find effective solutions and succeed in the sector, including in-depth knowledge of tax planning, structuring developments and state and federal legislation. Contact us today to speak to one of our many experts about the issues facing you on a daily basis.