Secretary Fudge Highlights Biden-Harris Administration Actions to Increase Affordable Housing Supply and Lower Housing Costs

SECRETARY FUDGE HIGHLIGHTS BIDEN-HARRIS ADMINISTRATION ACTIONS TO INCREASE AFFORDABLE HOUSING SUPPLY AND LOWER HOUSING COSTS

WASHINGTON - U.S. Housing and Urban Development (HUD) Secretary Marcia L. Fudge on Monday traveled to Columbus, Ohio to announce actions in the Biden-Harris Administration Action Plan to Ease the Burden of Housing Costs. The Plan is a set of legislative and administrative steps aim to close the housing supply gap within the next five years.

Secretary Fudge highlighted the Plan at an affordable housing development that is under construction in Columbus, Ohio. She was joined by U.S. Senator Sherrod Brown, U.S. Congresswoman Joyce Beatty, and Columbus Mayor Andrew Ginther.

"The Housing Supply Action Plan is the latest step HUD, and the Biden-Harris Administration are taking to expand our nation's supply of affordable housing," said Secretary Fudge. "This plan will ease costs for families across the country and give communities the tools they need to make more affordable housing available to residents."

Under the Plan - which builds on the steps the Administration announced last September to build and rehabilitate 100,000 homes over the next three years - the Administration will reward jurisdictions that have reformed zoning and land-use policies; deploy new financing mechanisms to build and preserve more housing where financing gaps currently exist; expand and improve existing forms of federal financing; ensure that more government-owned supply of homes and other housing goes to owners who will live in them; work with private sector to address supply chain challenges and finish construction in 2022 on the most new homes in any years since 2006.

HUD will play a central role in carrying out these actions, including through the following immediate next steps:

• Supporting production and availability of manufactured housing. HUD is making it easier to finance new units and helping manufacturers update their designs to meet changing consumer demands. This includes working to increase the usability of FHA's Title I loan program for Manufactured Housing, supporting greater securitization of Title I loans through Ginnie Mae's platform, updating the HUD Code to allow manufacturers to modernize and expand their production lines, and helping manufacturers respond to supply chain issues.
• Advancing HOME as a key tool for the production and preservation of affordable rental and homeownership housing. HUD will update guidance to strengthen the HOME Investment Partnerships Program. Through the reauthorization of HOME, updated guidance, and robust technical assistance, HUD will advance and streamline this critical resource for the creation of affordable rental housing and promotion of homeownership.
• Continuing to drive housing production through the Federal Financing Bank's Risk Sharing Program. Last September, the Administration announced that Treasury and HUD had finalized an agreement to restart the Federal Financing Bank's Risk Sharing program. The program provides loans at reduced interest rates to state and local housing finance agencies to create and preserve high-quality, affordable homes. Twenty-two state agencies have been approved to use FFB, and HUD has committed to guarantee more than $1.3 billion in loans representing more than 7,100 affordable units. HUD will work in the months ahead to accelerate this work by encouraging more state and local HFAs to participate and explore the development of a permanent financing mechanism for these loans through Ginnie Mae's securitization platform.
• Improving the alignment of federal funds to reduce transaction costs and duplications and accelerate development. To reduce transaction costs and duplication, and to speed development, the Administration will make changes to harmonize federal requirements across programs as much as possible - including through programs like HUD's LIHTC Pilot Program, which streamlines FHA processing of mortgage insurance applications for projects with LIHTC equity. To encourage alignment of affordable housing subsidies, the White House, HUD, Treasury, and USDA will convene state housing agencies to discuss best practices on the alignment of applications, reviews, and funding.
• Supporting new and existing affordable housing in Indian Country. HUD will award Indian Housing Block Grant (IHBG) funding to Tribes and Tribally Designated Housing Entities to finance the construction of new affordable housing in Indian Country, and also make historic levels of annual IHBG formula funding available to them.
• Directing supply to owner-occupants and mission-driven entities instead of large investors. Earlier this month, FHA announced it is expanding its Claims Without Conveyance of Title Process (CWCOT) to include the establishment of an initial exclusive Post-Foreclosure Sales Period for owner-occupant buyers, HUD approved non-profit, and governmental entities. FHA, FHFA, and agencies across government will accelerate efforts to direct available supply to targeted buyers by continuing to target the sale of at least 50 percent of mortgage notes to owner-occupants and mission-driven entities.
• Encouraging use of CDBG for local acquisition and local sales to owner-occupants and mission-driven entities. HUD also will provide technical assistance and update guidance on the "Use of CDBG Program Funds in Support of Housing" to promote acquisition, homeownership assistance, conversion of existing structures into rental housing and "starter" homes, housing counseling, and rehabilitation and reconstruction.
• Promoting modular, panelized, and manufactured housing - and construction R&D. Innovations in homebuilding, including manufactured, modular, panelized, precut, and additive construction, hold promise for increasing housing productivity and thus housing supply. HUD will highlight these and other technologies that can benefit affordable housing construction during the Innovative Housing Showcase on the National Mall in June 2022. HUD is also working to assess hurdles to modular and panelized housing posed by inconsistent state and local inspection requirements and standards, which limit economies of scale and potential cost savings.