Numerous congressional committees have recently addressed the nation’s scarcity of affordable housing—including this week’s Senate Finance Committee hearing, “The Role of Tax Incentives in Affordable Housing,” which focused on the Low Income Housing Tax Credit (LIHTC) and other legislative incentives.
- Senate Finance Chairman Ron Wyden (D-OR), Ranking Member Mike Crapo (R-ID) and several witnesses expressed support during the hearing for the Affordable Housing Credit Improvement Act (S.1136), introduced by committee member Maria Cantwell (D-WA). The bill would expand and strengthen the LIHTC.
- The bill (detailed summary here) would expand the pool of tax credits that are allocated to states for new affordable housing, make it easier to combine LIHTC with other sources of capital like private activity bonds, and facilitate LIHTC rehab projects. (Tax Notes, July 21)
- Hearing witness Dana Wade—an executive at Walker & Dunlop and a former commissioner of the Federal Housing Administration (above)—noted that 25 percent of all renters spend more than half of their monthly income on rent. Wade also testified extensively about the causes of the housing affordability crisis.
- “An estimated 40 percent of development costs can be attributed to regulation at the federal, state, and local levels,” testified Wade. “Zoning policies like density limits, requirements for parking, height restrictions, lengthy permitting and approval processes, and other land-use restrictions create a perfect storm that can often stymie new development.”
- One of the largest multifamily lenders and LIHTC syndicators in the country, Walker & Dunlop is chaired and managed by Roundtable Member Willy Walker.
- “Overly restrictive land-use and zoning policies, construction cost increases, and labor shortages are deepening our housing challenges, which now extend across the entire country,” said Real Estate Roundtable President and CEO Jeffrey DeBoer (above). “Government at all levels needs to be part of the solution, not part of the problem. The Affordable Housing Credit Improvement Act would be an important step forward.”
- The future of S. 1136 is uncertain after key centrist Sen. Joe Manchin recently said he would not support any legislative package that included tax increases until more economic data affecting the 40-year high inflation rate becomes available. Chairman Wyden did not promise a timetable for committee action. (Roundtable Weekly, July 15)
- Other congressional efforts to address affordable housing included yesterday’s Senate Banking, Housing and Urban Affairs Committee hearing on the state of housing in America. Policymakers heard testimony from Dr. Lawrence Yun, chief economist with the National Association of Realtors and Dr. Douglas Holtz-Eakin, president of the American Action Forum.
- In the House, a July 20 House Financial Services Committee hearing focused on ways to provide more affordable housing in the face of rising inflation. Additionally, a July 12 House Ways and Means Committee hearing and a June 28 House Financial Services Subcommittee hearing focused on institutional ownership in the single—family home market other affordable housing issues. (Roundtable Weekly, July 15 and July 1)
The Roundtable’s Real Estate Capital Policy Advisory Committee (RECPAC) has formed an Affordable Housing Working Group, which is working with the Research Committee to develop proposals on expanding the nation’s housing infrastructure.
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