Sep 2, 2021 | Affordable Housing News, Latest News
Today the White House announced a series of policies to take “immediate steps” to “supplement the Biden-Harris Administration’s push for historic, long-term investments in new housing as Part of the Build Back Better Agenda,” which includes lifting Fannie Mae and Freddie Mac’s (the Enterprises) Low Income Housing Tax Credit (Housing Credit) investment caps to $850 million each. The current caps are set at $500 million each.
The Federal Housing Finance Agency (FHFA) will also increase the Enterprises’ Duty to Serve rural/targeted investment requirement from 40 percent to 50 percent of each Enterprise’s total Housing Credit investment capacity. The White House announcement states, “By both raising the caps and targeting the investments at affordable rental housing, today’s actions will support the development and preservation of affordable units in areas most in need.” See FHFA’s press release here.
The Administration will also relaunch the multifamily Federal Financing Bank and HUD Risk Sharing Program (see HUD’s press release), and provide $383 million through the Capital Magnet Fund while encouraging that the new resources be used for affordable housing production. $175 million was provided through the Fiscal Year 2020 Capital Magnet Fund award round which, at the time, was the largest award round yet. Additional changes from the Administration focus on manufactured homes, very small multifamily properties, investor purchases of single-family homes, and state and local efforts to increase affordable housing supply. See the full White House fact sheet here.
Notably, the fact sheet also reiterates the Biden Administration’s support for expanding the Housing Credit through infrastructure legislation, stating:
“Even before the pandemic, 11 million families – or nearly a quarter of renters – paid more than half of their income on rent. President Biden believes this is unacceptable. Rent should be affordable for working families. That’s why the President’s Build Back Better Agenda calls for the historic investments that will enable the construction and rehabilitation of more than a million affordable housing units, reducing the burden of rent on American families. From the expansion of the Low-Income Housing Tax Credit (LIHTC) to major investments in the HOME Investment Partnerships program, the Housing Trust Fund, and the Capital Magnet Fund, the Build Back Better Agenda will make it easier for more Americans to find quality, affordable places to live.”
