March 14, 2018

Board of Commissioners Update

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VHDA’s Board of Commissioners has undergone some recent changes. We’d like to thank Sarah Stedfast and Lemella Y. Carrington for their dedicated service and wish them well. Kit Hale is our new Chairman and Clarissa McAdoo Cannion is our Vice Chairman.

Governor Ralph Northam appointed Erik Johnston as the Director of the Department of Housing and Community Development (DHCD) and he will serve on VHDA’s Board as an ex-officio member. In addition, William (Bill) Shelton, DHCD’s former Director, will remain on VHDA’s Board serving as a citizen member also appointed by the Governor. 

March 7, 2018

Creating Opportunities for Homeownership

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Preventing Foreclosure

VHDA’s Servicing Department held four Borrower Outreach Events to prevent foreclosure. These events provided customers an opportunity to meet with our staff in person, receive education on how to prevent foreclosure and apply for loan modifications. We have modified 121 loans through this program, and about 69% have remained current.

 Reaching Underserved Areas

We’ve recently increased our ability to serve communities in Southwest Virginia by hiring Frank Webster, an experienced Business Development Officer, who is dedicated to the region. This will strengthen our stakeholder relationships in the area and enable us to provide more educational opportunities for consumers in this part of the state.

Helping First-time Homebuyers

VHDA is preparing a springtime campaign to increase awareness about our Loan Combo, which offers a home loan plus a package of benefits including a down payment grant, an MCC and our free homebuyer class.

In Case You Missed It: A Look at Recent National Housing Policy News

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Rental Housing

Commercial and Multifamily Construction Starts Down in 2017

Many metro areas reported reduced commercial and multifamily construction starts in 2017 compared to 2016, said Dodge Data & Analytics, New York. "Of the commercial and multifamily project types, multifamily housing is the one that appears to have already reached its peak and is now heading downward," said Dodge Data & Analytics Chief Economist Robert Murray, noting a 12 percent decline in dollar terms during 2017.

The Number of High-Income Renters Surged, Especially in the Nation’s Highest-Cost Markets

High-income renters are a growing share of all rental households, particularly in the nation's most expensive metropolitan areas, including Washington. The shift comes amid tremendous growth in the national rental housing market, which added nearly 10 million new rental households between 2006 and 2016. These include 2.9 million "high-income" renters (those with real annual incomes exceeding $100,000). This is a 29 percent increase in a group that represented 9 percent of all renters in 2006 but accounted for 13 percent of renters in 2016.


Updated Credit Scoring and the Mortgage Market

The Federal Housing Finance Agency (FHFA) is considering a potential change in the credit scoring models approved for use by Fannie Mae and Freddie Mac, and is currently receiving public comment on this important policy issue. This report provides an overview of the issues involved.

Mortgage Insurance Companies Push Back Against 50% DTI

Last year, Fannie Mae and Freddie Mac announced they were increasing their debt-to-income ratio to 50%. But now, private mortgage insurance companies are pushing back, announcing new underwriting requirements, including higher credit scores, for loans with DTIs exceeding 45%.

Reforming the FHA’s Foreclosure and Conveyance Processes

This report addresses how the Federal Housing Administration (FHA) foreclosure and conveyance processes can be changed to bring down costs and create efficiencies.

Your Mortgage Application May Trigger Competitors to Tempt You with Other Offers

Credit bureaus routinely convert information they receive regarding mortgage application filings within 24 hours into “trigger leads” which they sell to competing mortgage lenders. This practice has become controversial and is being blamed for predatory practices on consumers, especially unsophisticated ones. Last week, the National Association of Mortgage Brokers began pushing a campaign on Capitol Hill for an outright ban.

Manufactured Housing

Can Manufactured Housing Ease America’s Affordable Housing Crisis?

The affordable home purchase market continues to suffer an acute inventory shortage. High construction costs and labor shortages mean builders can’t keep up with household formation, and Americans who already own homes are reluctant to sell an asset that is appreciating rapidly. While there’s no easy fix, signals within the federal government suggest one solution is getting increased attention—manufactured housing.  Now, Federal agencies are reviewing financing and regulations in hopes of giving manufactured homes a boost. This article summarizes these issues and their impact on the industry.

MBA Urges HUD to Take Opportunities on Manufactured Housing

HUD is preparing to review its current regulation of manufactured housing and has requested public input. The Mortgage Bankers Association, in a February 26 letter to HUD, said manufactured housing offers the agency with opportunities to help meet the nation's affordable housing needs and urged it to take a more flexible regulatory approach.

February 28, 2018

In Case You Missed It: A Look at Recent National Housing Policy News

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Foundation Funding for Housing

Nine Foundations Launch Housing Collaborative

Nine of the nation’s largest private foundations have joined forces to create the Funders for Housing and Opportunity (FHO) collaborative with the goal of ensuring individuals and families who spend more than half of their income on rent—or have no homes at all—will be able to afford safe, stable rental housing in thriving communities. Together, FHO members will commit grant dollars that will be used to catalyze systemic change. The new organization announced that it has committed $4.9 million to four grantees over the next three years.

Multifamily Housing

Construction Costs Spike for Multifamily Projects

The cost of construction is rising rapidly for apartment developers and contractors. “I expect contractors to pay 4 percent to 5 percent more in 2018 than in 2017,” says Ken Simonson, chief economist with the Associated General Contractors of America. That includes both construction materials and services, such as truck transportation, subcontracting and leasing.


Nowhere to Go but Up?  How Increasing Mortgage Rates Could Affect Housing

Freddie Mac has released its February Insight, which looks into the effects of higher mortgage rates on homebuyers, homeowners wishing to refinance, mortgage lenders, home builders and real estate agents. The Insight delves into the past to review periods when interest rates spiked and analyze the effects on the housing industry.

Manufactured Housing an Opportunity for Affordable Homeownership

This article provides a brief case example of the use of manufactured housing in San Bernardino, CA on scattered in-fill lots to help in providing affordable homeownership and revitalize city neighborhoods.

Homeownership is Still Financially Better than Renting

An analysis by Urban Institute research staff looks at costs of homeownership versus renting, and shows that homeownership remains highly beneficial for most families, offering both financial gains and a way to build wealth. Homeownership is shown to be especially beneficial for those who expect to own their home for a long enough period to overcome the sizable transactions costs and the cyclical volatility of home prices.

February 14, 2018

Brighter Future Unfolds for Fletcherville

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VHDA’s Community Outreach Division and Strategic Lending Unit have teamed up with Fauquier County and not-for-profit Foothills Housing Corporation to provide some much-needed improvements in a rural Virginia community. Fletcherville is a neighborhood of 36 rental homes built in the 1960s and 70s, just outside of Warrenton, Va.

VHDA is providing a $30,000 Community Impact Grant from our REACH Virginia program to Fauquier County on behalf of Foothills Housing Corporation, which plans to purchase the entire Fletcherville property. This will enable them to preserve the neighborhood’s affordability and also address issues with wastewater disposal and renovations needed to make the homes more comfortable and energy-efficient for the families who live there. The grant is funded by VHDA’s REACH Virginia program, which channels a substantial portion of our net revenues to support many programs such as Fletcherville’s revitalization.

Fletcherville is not connected to Warrenton’s sewer system, and its drainfields have raised concerns about the safety of groundwater and Warrenton’s nearby reservoir. Foothills’ proposal would extend Warrenton’s sewer lines to all the homes. Another proposed improvement is replacing oil and gas heat with clean, energy-efficient electric heat pumps.

VHDA Director of Strategic Housing Chris Thompson said he’s pleased that Fauquier County will manage the grant for Foothills, because “it demonstrates Fauquier’s firm commitment to improving the lives of Fletcherville residents, safeguarding Warrenton’s water supply and making the region even more desirable as a place to call home.”

The VHDA grant will pay for an appraisal and environmental assessments that Foothills must submit to Virginia Community Capital, the lender providing initial financing for the acquisition. When that short-term loan matures, VHDA intends to offer long-term financing for the acquisition, home improvements and the sewer project. John Reid, Executive Director of Foothills, said, “VHDA’s very good terms for a loan make the whole project doable.”

The partnership with Fauquier County and Foothills is one way VHDA is working to preserve and promote affordable housing in underserved rural Virginia communities. We’ve also introduced Foothills to agencies they may tap for future loans and grants, such as USDA Rural Development, the Department of Housing and Community Development (DHCD) and the Southeast Rural Community Action Program. John Reid added, “VHDA has been wonderful to work with … bringing groups together on our behalf to fund these energy-efficient improvements.”

Foothills Housing Corporation was founded in 1970 with a mission to provide community wells in neighborhoods with little or no access to running water. Since then, it has expanded its scope and reach beyond plumbing and Fauquier County to make more safe, comfortable, affordable housing available to families and the elderly in many Virginia localities.

February 13, 2018

In Case You Missed It: A Look at Recent National Housing Policy News

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HUD FY 2019 Budget

Trump Administration Proposes 2019 HUD Budget

This HUD Administration press release focuses on its core priority of providing direct assistance to vulnerable populations, while proposing significant cuts to capital programs and stating the Administration’s commitment to the idea that “state and local governments are best positioned to address specific needs in their communities.”

Chart Book:  Employment and Earnings for Households Receiving Federal Rental Assistance

The Trump Administration’s proposed budget has raised a major policy debate regarding the imposition of work requirements for recipients of federal rental assistance. This analysis by the Center for Budget and Policy Priorities (CBPP) exams data on the income and employment of current rent subsidy recipients to help gauge the potential impact of new requirements.

Other Federal Policy News

Mortgage Choice Act Approved by House of Representatives

The House of Representatives has voted to pass the Mortgage Choice Act of 2017, which would adjust the Truth in Lending Act’s definitions of points and fees under the Ability to Repay/Qualified Mortgage rule.

FHFA Finalizes 2018 to 2020 Goals for Fannie Mae and Freddie Mac

The Federal Housing Finance Agency (FFHA) has published a final rule that establishes new single family and multifamily housing goals for Fannie Mae and Freddie Mac for 2018 through 2020 in accordance with the provisions of the Housing and Economic Recovery Act of 2008.

Rental Housing

MBA Projects 2018 Maturing Commercial/Multifamily Mortgage Volume to Drop 42%

A large share of commercial mortgages carry a maturity of 10 years.  2017 marked the end of the “wall of maturities” for loans closed during the housing boom.  Now, 2018 will see a steep fall off in maturities as the smaller number of loans closed during the 2008 financial crisis mature.


Mortgage Servicers Prepare for Next Natural Disasters

2017 provided a wake-up call to the mortgage servicing industry, which saw a sharp spike in mortgage delinquencies and foreclosures in the areas affected by hurricanes and wildfires. A summary of lessons learned and issues to be addressed in mortgage servicing disaster preparedness planning.

Market Trends

Redfin:  Affordable Inland Metros Drew Migrants from High-Cost Coastal Markets

Online real estate firm reports that migration patterns in the fourth quarter saw people in expensive, high-tax coastal markets such as San Francisco, New York, Los Angeles and Washington search for homes in more affordable metros with lower taxes. This confirms the out-migration pattern seen recently in Census Bureau and Weldon Cooper Center (UVA) estimates of population change in Northern Virginia.

February 6, 2018

In Case You Missed It: A Look at Recent National Housing Policy News

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GSE Reform

Fannie-Freddie Bill includes Billions for Affordable Housing

A Senate bill to reform Fannie Mae and Freddie Mac, the result of discussions between Tennessee Republican Bob Corker and Virginia Democrat Mark Warner, would devote billions of dollars to boosting home ownership among lower-income borrowers.  The draft gives the clearest view yet into how the senators aim to woo progressive politicians to back their plan. Support from those Democrats is likely needed to meet the 60-vote threshold for passing major bills in the Senate.

GSE Reform Bill Could be Congress’s Last Chance

In this op-ed interview, MBA CEO David Stevens discusses his views on key provisions of the draft legislation and the importance of moving a bill forward.

Rental Housing

LIHTC Market Faces “Mild Turbulence” Ahead

Investors and developers in the Low-Income Housing Tax Credit (LIHTC) market are adapting to a dramatic drop in pricing over the past year and expecting more uncertainty ahead. The main concern is that demand for tax credits could diminish once institutional investors calculate the full impact from the Tax Cuts and Jobs Act. However, investors have not yet hit the pause button. They still have ample capital available and a desire to buy tax credits.

Work Requirements and Housing:  What We Don’t Know Could Hurt Us

It is now considered likely that the Administration’s HUD budget proposal will authorize PHA’s to impose work requirements on abled-bodied recipients in federal rental assistance programs. This Urban Institute blog post exams what is known as well as what is not known about the impact of work requirements in low-income housing programs.


Manufactured Homes Could Ease the Affordable Housing Crisis. So Why Are So Few Being Made?

This Urban Institute blog post provides a brief overview of the manufactured housing industry’s impact on the affordable housing market over the past 40 years, and looks at the potential for manufactured housing to again play an important role in meeting affordable housing needs.