Biden Administration Unveils Solutions to Boost U.S. Housing Supply

New actions seek to increase supply of affordable homes

The Biden Administration has released details on how it plans to build more housing and lower housing costs nationwide through a series of initiatives, including:

  • Bolstering federal programs with a track-record of producing affordable housing;
  • Boosting the supply and affordability of manufactured homes; and
  • The promotion of a more fair and transparent rental market.

The Biden Administration’s actions fulfill and build upon the dozens of commitments in the White House Housing Supply Action Plan released last May, and the Blueprint for a Renters Bill of Rights, released last January. The Administration recognized that additional actions were necessary to lower housing costs and have called on Congress to make the investments necessary to ensure access to quality and affordable housing for all Americans.

Bolstering federal programs

The Biden Administration has taken action to improve the federal programs to support the construction and preservation of affordable housing. Today’s announcements will build on that progress by:

  • Extending the Federal Financing Bank Risk Sharing program: The U.S. Department of Housing & Urban Development (HUD) and U.S. Department of the Treasury are extending the Federal Housing Administration (FHA) and Federal Financing Bank (FFB) Risk Sharing program–providing an ongoing source of capital so that state and local housing finance agencies (HFAs) can continue to offer FHA-insured multifamily loans at reduced interest rates to create and preserve high-quality, affordable rental homes. After the previous Administration suspended the program, the Biden Administration restarted the program in 2021. Since then, more than 12,000 affordable housing units have been created or preserved, supported by almost $2 billion in FHA-insured loans made through the program. This new extension will create an estimated 38,000 additional units over ten years, as well as bolster HFA participation in the program.
  • Making the HOME program easier to use: In the coming weeks, HUD will publish a proposed rule to streamline and modernize the regulations for the HOME Investment Partnerships Program (HOME program). During the Biden Administration, HUD has allocated $4.35 billion in funding to build and preserve affordable rental homes and make homeownership a reality for thousands of families. In collaboration with states, cities, local elected officials, stakeholder organizations, and local community development partners, HOME has assisted over 45,000 households since 2021. HUD is proposing improvements that would make HOME easier to use for individuals and families looking for a home to rent or buy, as well as for homeowners making upgrades to their homes such as accessibility improvements, new roofs, and replacement of outdated utilities with energy efficient ones. These proposals would also streamline requirements for grantees administering funding, community development organizations building new homes, and property owners renting to HUD-funded households.
  • Providing new funding to support housing for low-income seniors: HUD recently announced the availability of $115 million in grant funding to support the development preservation of supportive housing for an estimated 1,100 units for low-income seniors through the Section 202 Supportive Housing for the Elderly program. Approximately $35 million of these funds will be set aside to create intergenerational housing units with features to meet the needs of households headed by seniors who are raising children under 18 years old.
  • Unlocking affordable housing tax credits for states affected by recent disasters: The Internal Revenue Service (IRS) recently released guidance clarifying that returned low-income housing tax credits that were allocated to disaster areas in 2021 and 2022 can be reallocated for any proposed LIHTC project.

In addition to funding housing production and preservation, HUD recently awarded nearly $4 million in research funds to assess the potential of off-site construction and state and local land use and zoning reforms to increase housing supply. The Offsite Construction and Land Use Reform Notice of Funding Opportunity (NOFO) awarded a total of $3 million to 10 institutions to conduct research to assess the potential for off-site construction methods and zoning and land use reforms to increase the supply of quality affordable housing and reduce housing expenses for low- and moderate-income owners and renters. The Office to Residential Conversions Notice of Funding Opportunity (NOFO) awarded a total of $858,261.91 to study recent efforts to convert downtown office buildings to properties with residential units since the start of the COVID-19 pandemic.

Boosting the supply of manufactured homes

More than 20 million Americans currently live in manufactured housing, which is the largest form of unsubsidized affordable housing in the country. Manufactured housing provides an essential path to increasing overall housing supply and offers significant savings over site-built housing.

Through today’s actions, the Biden Administration is taking steps to preserve and rehabilitate existing manufactured home communities and to make it easier to finance the purchase of manufactured homes, by:

  • Releasing a $225 million funding opportunity to support manufactured housing communities: HUD has announced that the application for Preservation and Reinvestment Initiative for Community Enhancement (PRICE) grants is now open to support the preservation and revitalization of manufactured housing communities. These grants can be used for the replacement of dilapidated homes, assistance for repairs and accessibility modifications, mitigation and resilience upgrades, improvement of infrastructure, housing services including eviction prevention, and planning activities. This marks the first time the federal government has made grant funding available specifically for investments in manufactured housing communities, including resident-owned communities. A portion of funds are dedicated to supporting Tribes and tribal nonprofit organizations.
  • Preserving the affordability of manufactured housing communities via expanded financing options: Corporate investors are purchasing manufactured housing communities and driving up rent and driving out longtime residents. The FHA is publishing a draft Mortgagee Letter that, once finalized, will create a new program to preserve affordability for existing residents of manufactured housing communities. Under the new program, resident cooperatives and other mission-oriented borrowers will be permitted to use FHA 223(f) multifamily loans to acquire or refinance communities. Through the initiative, a PRICE recipient could use the program to purchase the community from its current owner, preserving its long-term affordability, and use PRICE funds for infrastructure improvements and home repairs. However, eligibility for this program will not be limited to PRICE awardees.
  • Increasing loan limits for Title I Manufactured Housing: This week, FHA published a final rule increasing loan limits for the Title I Manufactured Housing program, which insures loans to finance the purchase or refinancing of manufactured homes titled as personal property. Doing so will allow FHA to better serve low- and moderate-income and first-time buyers of manufactured housing whose financing needs have not been well-served by the private market. The rule will increase loan limits to be in line with current market prices and enable HUD to regularly update the limits in the future. To support this action, Ginnie Mae has revised eligibility requirements for Issuers of its Manufactured Housing Mortgage-Backed Securities program. These actions are intended to reduce barriers to entry for Issuers and increase participation in its securitization program for Title I loans.

Ginnie Mae President Alanna McCargo said, “Ginnie Mae plays a crucial role in supporting the financing of affordable housing supply, and manufactured housing is an important part of the solution. “We’ve consulted the industry and worked closely with FHA to update and align our Title 1 eligibility requirements to support more financing in tandem with the vast improvements FHA is making to its program. Today’s announcement marks significant progress in expanding access to the secondary market for more Title I issuers and deploying more capital for manufactured housing lending going forward.”

“Manufactured homes are an important part of the nation’s lower-cost housing stock, yet many families, especially historically underserved communities, lack access to safe and affordable financing for these homes,” said Rachel Seigel, Senior Officer with The Pew Charitable Trusts’ Housing Policy Initiative. “Today’s announcement is a major step towards improving access to financing for thousands of American families that are shut out of today’s housing market.”

Bring fairness to the rental marketplace

In January 2023, the White House published a Blueprint for a Renters Bill of Rights, which contained dozens of agency commitments to create a fairer rental market. New actions that will piggyback off the Blueprint for a Renters Bill of Rights include:

  • Clarifying banned non-rent fees in HUD-assisted properties: Through today’s actions, HUD is releasing new resources clarifying policies and laws that prohibit certain non-rent fees in its Multifamily, Public Housing, and Housing Choice Vouchers/Project Based Vouchers programs. These new resources ensure that certain fees, such as application and screening fees in Public Housing and Multifamily subsidized programs, are prohibited, and help ensure that tenants are not charged or penalized for impermissible fees.
  • Ensuring tenants’ rights for military servicemembers: The Department of Defense (DoD) announced all 200 of its bases will have adopted its Tenant Bill of Rights by the end of the calendar year. Once fully implemented, it will cover approximately 203,000 houses for servicemembers and their families.
  • Providing new resources to prevent unfair evictions: HUD will issue a new fact sheet highlighting situations in which housing providers may not evict or threaten to evict someone. In addition, HUD’s Office of Policy Development and Research (PD&R) has published policies that local and state governments can adopt to reduce eviction filings, such as requiring good cause for evictions, increasing access to legal services, improving access to courtrooms, using data to identify at-risk households, sharing data across sectors, offering financial assistance, and providing housing navigators who can assist with connecting tenants to supportive services.
  • Promoting prospective renters’ rights during tenant screening process: The Federal Trade Commission (FTC), Consumer Financial Protection Bureau (CFPB), the Department of Justice (DOJ), and HUD will jointly publish a fact sheet describing the rights prospective renters have when screened by housing providers. Together, the four agencies administer the Fair Credit Report Act (FTC and CFPB) and the Fair Housing Act (DOJ and HUD), and the fact sheet lays out protections under these two laws in one document.

“Simply put, the supply of housing has not kept pace with increasing demand, making housing too expensive for far too many people. HUD is using every single tool we have to ensure the families we serve can access affordable homes,” said HUD Deputy Secretary Adrianne Todman. “Today’s announcement means that, together with our partners at the Department of the Treasury, HUD will be able to continue providing the capital needed to build and preserve tens of thousands of rental units for the families who need our help.”

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Eric C. Peck

Eric C. Peck has 25-plus years’ experience covering the mortgage industry, most recently serving as Editor-in-Chief for National Mortgage Professional Magazine. He graduated from the New York Institute of Technology, where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career with Videography Magazine before landing in the mortgage space. Peck has edited three published books, and has served as Copy Editor for
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