Significant investments in new construction and preservation are needed to meet growing housing demand. Common sense improvements and appropriate funding for programs that help increase our affordable housing stock are crucial to solving our affordable housing crisis.

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• Improve the Housing Credit: Common sense improvements to the Low-Income Housing Tax Credit (housing credit) program, such as excluding housing from the Private Activity Bond cap, permanently increasing allocation amounts, and permanently lowering the “50 percent test,” can make the program more effective in incentivizing affordable housing development.
• Invest in the HOME Investments Partnership Program: The HOME Investments Partnership Program plays a critical role in financing affordable housing construction. Continued support from Congress and increased funding allocations are needed to help develop additional affordable housing units.
• Ease Regulatory Requirements to Preserve Existing Units: Setting Davis Bacon wage requirements to 2024 dollars, tied to an annual inflation factor, and exempting affordable housing from Build America, Buy America requirements will ease the process of building and rehabilitating affordable units.
• Provide Ownership Flexibilities for USDA Rural Housing Service Properties: Providing creative solutions to help enable housing agencies take ownership of USDA Rural Housing Service properties when other owners are unavailable can streamline the preservation of these properties and increase the availability of affordable housing.
• Improve Housing Preservation Options: Ensuring that housing preservation options, such as the Rental Assistance Demonstration (RAD) program, accurately reflect on-the-ground rental prices is essential. HUD’s Operating Cost Adjustment Factor (OCAF) methodology requires revision to better align with current rental market conditions. Congress and HUD must continue maximizing existing housing preservation efforts and increase housing inventory by creating new repositioning options and making them voluntarily available to all housing agencies.
• Increase Project-Basing Flexibilities: Congress should provide housing agencies the discretion to project-base up to 50% of their portfolio so housing agencies can ensure affordable housing units are built and preserved in high-cost markets where a scarcity of units may impact tenant-based voucher lease-ups.

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By implementing these proposed improvements, Congress and housing stakeholders can work towards meeting the increasing demand for affordable housing while also promoting the preservation and sustainability of existing housing stock. Collaboration between local agencies and federal partners will be crucial in addressing the complex challenges of housing affordability and availability.