According to the National Low Income Housing Coalition’s (NLIHC) March 2021 report, The Gap: A Shortage of Affordable Rental Homes, the housing affordability crisis has been perpetuated by the COVID 19 crisis. As of January 2021, more than 20% of all renters were behind on rent payments, portending a potential, massive wave of evictions and a destabilizing event in the lives of many low-income renters. This highlights just how important it is for Congress to enact measures that will strengthen the affordable housing industry and further development at this time.
Prior to the COVID 19 crisis, the Affordable Housing Credit Improvement Act (AHCIA) (with bipartisan support in both the House and Senate) was the primary policy vehicle to make fixes and introduce new measures to the affordable housing industry. While never enacted, a few of these important measures were included in subsequent relief legislation. Two of these measures were the enactment of the minimum 4% credit rate and a 12.5% increase in the allocation of housing credits.
With an eye toward the future and in an effort to capitalize on such important gains, the AHCIA was reintroduced in Congress on April 15. The bill continues to have bipartisan support in both houses. While the 2021 bill tracks its previous version, new and important measures have been introduced. These measures include:
- Reducing the bond threshold from 50% to 25%. Novogradac estimates that over the next decade this modification alone may lead to the financing of an additional 1.5 million affordable homes.
- Phasing in a 50% increase in the allocation of housing credits over two years rather than five.
NLIHC’s The Gap report reaffirms the urgency to act. While the AHCIA will not alone solve the nation’s affordable housing crisis, it is an affirmative step forward in delivering more safe, secure, and quality affordable homes this decade.
Hooker DeJong, Inc., (HDJ) is a leading national design firm providing architectural and engineering expertise to support the affordable housing industry throughout the United States. HDJ’s diverse portfolio includes successful outcomes with adaptive reuse renovation, acquisition rehab, new construction, historic preservation and RAD.
Author: Josh Hahn