Report finds better policies are needed to support preservation of federally assisted housing stock, including more adequate annual appropriations and stronger preservation protections
Washington, D.C. – The National Low Income Housing Coalition (NLIHC) and the Public and Affordable Housing Research Corporation (PAHRC) released today a jointly authored report, Picture of Preservation 2024. The report analyzes data from the National Housing Preservation Database (NHPD) to assess the existing federally assisted housing stock and the specific preservation risks faced by these homes, including expiring affordability and eligibility restrictions, declining physical quality, and significant reductions in federal allocations. Mitigating these risks and preserving the existing federally assisted housing stock is essential to any effort to expand the supply of affordable housing for the lowest-income renters.
“The U.S. is short a total of 7.3 million homes affordable and available to the lowest-income renters,” said NLIHC Senior Vice President of Research Andrew Aurand, one of the report’s authors. “Given the shortage of affordable rental units in the private market, federally assisted rental homes are a vital source of stable housing for extremely low-income renters. However, these homes require sustained or renewed funding commitments to ensure future affordability and habitability as buildings age and existing rent restrictions and tenant eligibility requirements expire or come up for renewal.”
Picture of Preservation 2024 finds that 5 million rental homes are supported by federally funded project-based rental subsidies, representing 10% of the rental housing stock nationwide. The average federally assisted home has been affordable for 36 years. However, while an estimated 104,088 homes were added to the federally assisted housing stock in recent years, 71,096 homes were lost, resulting in a net gain of only 33,992 federally assisted homes, according to the report.
The report also finds that exit risks are growing across the federally assisted housing stock. Affordability restrictions are set to expire for 374,497 federally assisted homes in the next five years, representing 7% of the stock. Compared to 2019, non-renewable subsidies fund a larger number and share of expiring homes, and for-profit ownership is more common. The growing reliance on non-renewable subsidies and increasing for-profit ownership suggest that properties expiring in the next five years may face additional barriers to preservation.
Public housing, meanwhile, faces a significant and growing depreciation risk, according to the report. Approximately 267,000 public housing homes (30%) failed their most recent Real Estate Assessment Center (REAC) physical inspection and likely require immediate investment – twice the number of homes that failed in 2019. One in five public housing homes have also failed two or more of their latest REAC scores, up from 9% in 2019. Meanwhile, the report finds that since 2010, key HUD project-based housing programs have lost a cumulative $21.3 billion in appropriations relative to the amount of funding that would have been available had funding been maintained in line with fiscal year 2010 levels adjusted for inflation.
The report concludes that better policies are needed to support preservation efforts, including more adequate annual appropriations for federal housing programs and stronger preservation protections to ensure the continued affordability and physical quality of the existing federally assisted housing stock. Especially necessary are major reinvestments to address the capital needs backlog in public housing and strengthened preservation policies in the LIHTC program. Without congressional action, many homes could be lost from the affordable housing stock, increasing housing instability for the lowest-income renters across the nation.
“Affordable housing plans must balance new construction and preservation to reduce the growing shortage of affordable homes available to the lowest income families,” said Kelly McElwain, PAHRC Manager of Research and Industry Intelligence and one of the report’s authors. “Providing sufficient funding for federal housing programs is essential to expanding the supply of affordable homes, ensuring current tenants remain stably housed in safe, quality homes, and safeguarding public investments.”
Download the full report here. Access a dashboard summarizing key data from the report at the state, county, and congressional district levels here. Learn more by registering here for a virtual event to be held on Wednesday, December 11, from 2 to 3 p.m. ET.
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