The Housing Assistance Council (HAC) announced the launch of its new Center for Rural Multifamily Housing Preservation, a cross-disciplinary initiative to preserve rural rental housing, particularly properties financed through the U.S. Department of Agriculture’s (USDA) Rural Rental Housing Loan (Section 515) program. HAC’s Kristin Blum will lead the initiative, which will provide technical assistance as well as lending, policy, and research support to efforts focused on transforming the preservation process and preserving critically important Section 515 units.
Funding for USDA’s Section 515 program – once the principal source of financing for affordable rental homes in rural America – has been cut by more than 95% over the past few decades, limiting rural communities’ ability to attract private-sector capital and other federal resources. Rental homes financed by the USDA are located in 87% of all U.S. counties, and the Section 515 program alone has produced 550,000 affordable apartments in rural communities. However, rural renters continue to face severe housing needs and low incomes – for example, the average USDA rental assistance recipient has an income of just $13,696. Despite the growing need, there has been no new construction of rural rental homes under the Section 515 program since 2012, and the fiscal year (FY) 2023 Multifamily Housing Occupancy Report calculated USDA’s current stock of Section 515 units at only 390,000, down from its peak of 550,000 units produced with USDA Section 515 loans.
The new initiative was announced in time for stakeholders to coordinate newly dedicated funding authority from USDA. The FY2024 appropriations bill included funding for a USDA pilot program to decouple Section 515 mortgages from Section 521 rental assistance. The pilot would allow for the renewal of rental assistance agreements for a maximum of 1,000 units, according to the bill text. Rural Housing Service Administrator Joaquin Altoro highlighted the pilot rental assistance program at the National Council of State Housing Agencies’ legislative breakfast on March 6.
Read HAC’s press statement announcing the new Center for Rural Multifamily Housing Preservation here.