The Housing Assistance Council (HAC) released "Rental Housing for a 21st Century Rural America: A Platform for Preservation" on September 6. The report examines the current state and future prospects of the U.S. Department of Agriculture’s (USDA) rental housing portfolio, which provides more than 415,000 affordable homes to low income people living in rural areas. Many of these properties are projected to lose their affordability provisions in the coming decades, and no new properties have been financed in several years. HAC consulted with an array of stakeholders to better understand USDA Rural Development housing programs and potential strategies to preserve and increase the supply of affordable rural rental homes.
The Section 515 direct loans are an important source of funding for affordable housing in rural areas but often lose their affordability protections once the loans mature or are prepaid. HAC estimates that 74 properties per year are projected to leave the program because of maturing mortgages in the next ten years, accounting for a total of 892 properties with 21,452 rental units. After 2028, the number grows dramatically, with 2,782 properties (81,819 units) projected to leave the program in just five years between 2028 and 2032.
The annual average household income of the tenants in Section 515-financed properties is only $13,600, and the majority of residents are seniors and people with disabilities. Because the rental assistance subsidy is tied to the Section 515 loan and is often the only housing option for the lowest income people in rural areas, preserving this source of affordable housing is crucial. HAC’s assessment provides a variety of preservation strategies and policy recommendations for USDA, owners and purchasers, tenants, and public interest groups.
Read the full report at: https://bit.ly/2Q8QoT4