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

Urban Institute: Here’s How Rising Interest Rates will Impact the Mortgage Market  

Interest rates have fallen not just since 2007, but consistently over the past 35 years, according to a new report from Laurie Goodman, Urban Institute co-director of the Housing Finance Policy Center. The 10-year Treasury note peaked at more than 15% in 1981, but fell to just 1.83% in November 2016. Primary mortgage rates followed this pattern, falling from more than 18% in 1981 to 3.54% in November. Now, mortgage rates are increasing once more as the Treasury yield and the 30-year fixed-rate mortgage are up 44 basis points and 49 basis points consecutively as of July this year. Data from Freddie Mac and the Federal Reserve, demonstrates the falling interest rates from the early 1980s until 2016.

Everything You Need to Know About Fannie, Freddie Appraisal-Free Purchase Mortgages

Freddie Mac announced it would be extending its appraisal-free mortgage program to purchase loans starting September 1, 2017. That same day, Fannie Mae also announced their appraisal-free purchase mortgage, offering its product effective immediately. But what does that mean exactly? Who qualifies? Are the GSEs moving to take appraisers out of the home buying process? For starters, why move to the purchase market to begin with? And how many Fannie and Freddie financed loans will qualify? Both GSEs already had a program in place for appraisal free refinances. Freddie Mac began their program earlier this summer, while Fannie Mae began offering appraisal-free mortgages on some of its refinances through its Day 1 Certainty program back in 2016. The answer from both companies was the same: After rising interest rates shifted the market from a refi market and more to purchase, the GSEs extended their programs to meet the needs of the shifting market.

The Game Changer for End-to-End Digital Mortgages: eClosings 

Nearly everything about the industry’s prized digital mortgage is streamlined except for the final, and one of the most important, steps at the end. The entire online process comes to an abrupt halt when it's time to close a loan, forcing borrowers to still meet up and cross the T’s and dot the I’s on an official document with a notary present. And while this process is evolving digitally, as noted here, it wasn’t until recently that the process truly became end-to-end thanks to a new company: Notarize. Notarize took the current eClosing process and brought it to the next level by allowing buyers to never have to leave their home or wet sign a single document.

How 61 Mixed-income Lofts Help Lynchburg’s Downtown Renaissance

Lynchburg had a good problem. With a growing population, the independent city needed more housing. The challenge was how to balance the affordable housing needs of moderate-income residents with the demand generated by a growing, highly skilled workforce with an appetite for downtown, waterside living on the banks of the James.

Photos courtesy of Altus Group

The Lynchburg Office of Economic Development took stock of its abandoned downtown factories and hit upon the solution: converted loft living. With support from VHDA, the process began to transform an old tobacco warehouse into a residential space that would combine history with modern design. The result of that effort is the Imperial Tobacco Lofts, a mixed-income, 61-unit community in the heart of downtown.

According to Wally Robinson, Strategic Lending Officer at VHDA, the adaptive reuse of the 19th century (1898) space required extensive renovations. It was important to preserve the building’s original character, so the design incorporates raw industrial materials and historical structures, complimented by polished contemporary finishes and appliances, and every floor plan in the building is unique.

The Lofts are home to residents with a range of incomes: 30 percent of units are reserved for those making 80 percent or less of the area median income (AMI), 20 percent are for those who make 120 percent or less of AMI, and the remaining units are available to residents with unrestricted income levels.

VHDA provided permanent financing with a Mixed-use / Mixed-income (MUMI) loan through our REACH program. (REACH, also called REACH Virginia, is VHDA’s internally generated resource that provides vital funding for affordable housing. Each year VHDA contributes a substantial portion of net revenues into this program.) The project also received historic tax credits.

The developers of the project, Blair Godsey of Altus Construction and George Stanley of Cityscape LLC, have been involved in other projects in downtown Lynchburg that combine historic charm with modern design. The developers also manage the Lofts and act as leasing agents.

The Imperial Tobacco Lofts are now fully occupied. The addition of this stylish, affordable mixed-income community has helped bring life back to Lynchburg's downtown and riverside area. Residents enjoy the area’s finest shopping, dining, entertainment and recreation, as well as lively festivals, a farmers market, walking trails and of course, the river.

As more people choose to live downtown, the energy continues to grow in Lynchburg’s urban core. According to Frances Stanley, Research and Policy Analyst at VHDA, the population has grown an estimated 14 percent within a half-mile radius of the Imperial Tobacco Lofts over the past seven years. VHDA is pleased to be a part of the revitalization that is happening in downtown Lynchburg.

More info: http://www.imperialtobaccolofts.com

5th VCU “Plan-Off” Supports Sustainable, Healthy Communities

Beams of sunlight peered through the second-story glass windows of the two-story brick building as a young woman dressed in black business attire calmly approached the podium. In front of her sat an audience of classmates, professors and community leaders eager to listen to her presentation. Across the hall, PowerPoints were lighting up screens as more students prepared their pitches, hoping to advance to the next round.

May 21, 2017 marked the fifth consecutive year that VHDA sponsored Virginia Commonwealth University’s annual Plan-Off event. Twelve graduate students from the L. Douglas Wilder School of Government and Public Affairs Master of Urban and Regional Planning (MURP) program faced off with one another in a tournament-style competition, each presenting their takes on solutions for real-world issues. After the presentations, a panel of judges chose the winner to advance to the next round.

2017 Plan-Off winners
Photos courtesy of the L. Douglas Wilder School  

“The Plan-Off is one of the signature events of the Wilder School's MURP program,” explained Dr. Meghan Gough, Program Chair of the Urban Planning major. “This exciting format provides an opportunity for students to translate their year-long effort in designing a plan into an ‘elevator speech’ which they present to a panel of leading planning professionals.”

The event doubles as the final project for these students as they prepare to wrap up their graduate education. Participants had the option of either writing a thesis paper or creating a presentation and pitching it at the Plan-Off. Gough believes that this innovative approach to a final gives graduates a hands-on experience in urban planning. “Our students work closely with their clients and stakeholders, and as a result many recommendations in the plans are implemented by organizations and communities,” said Gogh. “As a result of this intensive professional experience, Wilder School MURP students develop strong work portfolios that make them especially competitive in job placement.”

VHDA Managing Director of Community Outreach Mike Hawkins echoed these sentiments, saying “VHDA is happy to sponsor an event that strengthens the knowledge, skills and abilities of new planners to engage the community and promote positive planning outcomes. It’s great that we can expose them to the state housing finance agency, and communicate the importance of affordable housing in the context of good land use policy.”

Events such as VCU’s Plan-Off are important in today’s world. In the past, urban issues such as transportation, housing, beautification and economic development were often approached as separate problems. Planners have come to realize that all of these issues are interconnected, and that it takes a joint effort between specialists and leaders in many different fields to build quality and equitable communities for all of its citizens. VHDA’s investment in programs such as the Plan-Off exemplify our commitment to creating sustainable and healthy communities while promoting affordable housing opportunities.

A MURP student discussing his project

A MURP student pitching to the panel

Contestants display their projects on large posters which are
available for the public to read on their own. 

Mike Hawkins, VHDA Managing Director of Community Outreach
 and John Accordino, Dean of the L Douglas Wilder School

A graduate student explains her ideas on revitalization to Mike Hawkins and
Meghan Gough, Chair of the Urban and Regional Planning program at VCU

Advisory Councils Discuss Housing Opportunities

The Northern Virginia Advisory Council met in
Alexandria's City Hall.

Affordable housing in Virginia looks different in every region and for every community. To ensure a
holistic perspective, VHDA relies on our Advisory Boards and Councils to provide guidance on our programs and services. Members offer insight into industry challenges so that VHDA can continue to make a positive impact on the diverse affordable housing needs across the state.  

This summer we convened two Advisory Council meetings. VHDA’s Northern Virginia Advisory Council met on June 19, 2017 to discuss housing issues related to the Northern Virginia area. The cross-section of government, nonprofit, developer, lender and Realtor partners made for rich conversation. Later in the meeting, we divided into groups to discuss Rental and Homeownership topics and dive deeper into the nuances of the Northern Virginia market. Alexandria City Hall was the backdrop of this productive dialogue, highlighting the vibrancy of King Street. VHDA would like to thank the City of Alexandria for hosting the event!

On July 12, VHDA hosted the first summer meeting of our Supportive Housing Solutions Council at the Virginia Housing Center in Glen Allen. This council provides guidance and expertise in housing policy areas related to senior adults, homelessness and individuals living with disabilities. One of the main topics of discussion was aging in place.

We look forward to seeing both groups again at our Annual Holiday Luncheon this winter.

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

HUD Report Finds Worst Case Housing Needs Continuing to Grow  

HUD recently released its biannual Worst Case Housing Needs Report to Congress. The report finds that, despite continued signs of a strengthening national economy, 8.30 million households had worst case needs in 2015, up from 7.72 million in 2013 and approaching the record high of 8.48 million in 2011.

Why We Still Struggle to Disassociate Race and Risk in Housing 

A recent study by the Kirwan Institute for the Study of Race and Ethnicity examines the implicit bias against minorities found in housing and credit outcomes today. Although we like to assume that lending decisions are conducted in an objective manner, this is a misconception.

Home Equity Used to Start Seven Percent of U.S. Businesses 

Equity in a home was used as a source of capital to start 284,618 businesses—7.3% of all businesses in the U.S.—according to a new source of data released recently by the U.S. Census Bureau. The new data source is the Annual Survey of Entrepreneurs, (ASE), which collects economic and demographic information on businesses and business ownership in all major U.S. industries.

Realtor.com: Here’s Why Baby Boomers Keep Millennials from Buying Homes

Housing inventory shortages continue to plague the real estate market, and the generation that’s most to blame is Baby Boomers. In fact, the new Housing Shortage Study from realtor.com shows there are two major reasons for the housing shortage: Boomers’ reluctance to sell and the fact that homes already fit current family needs.

Facebook Ventures into Zillow’s Territory with Targeted Real Estate Advertising

Facebook has launched its first ad product designed specifically for residential real estate brokerages. “Dynamic Ads for Real Estate,” first reported by real estate news site Inman News, allow real estate brokers and agents to advertise directly to Facebook and Instagram users who have already searched for properties on that brokerage’s website. The product goes after a key money maker for Seattle-based Zillow, which allows real estate professionals to advertise to prospective home buyers and sellers on its site.

Housing Credit Program Offers Upcoming Training

VHDA's Housing Credit Department invites you to register for the following classes.

EarthCraft Building Professional Training

This seven-hour builder training provides a comprehensive overview of best practices for sustainable construction and design and explores how the EarthCraft program can help you get started in the green building sector. Whether you’re a single-family homebuilder, developer, architect, HVAC/insulation contractor, property owner/manager, or Housing Development Authority, you’ll learn cost-effective ways to improve the energy efficiency, indoor air quality, comfort and durability of homes, enhancing overall client appeal. Take advantage of this opportunity to learn more about the EarthCraft program and benefits of EarthCraft certification, as well as how to effectively market the advantages of EarthCraft certification to your prospective buyers. This class is worth six self-reported continuing education credits with the AIA.

Aug. 24, 2017  |  9 a.m. - 4 p.m.  |  Cost: $175 (Includes Lunch & Training Materials)
VHDA's Virginia Housing Center, 4224 Cox Rd., Glen Allen, VA 23060 
Register

How to Complete an LIHTC Application 

VHDA wants your deal to get all the points it deserves! This class, presented by VHDA's LIHTC Allocation department, provides vital information for new and experienced developers, as well as any staff members involved in Virginia’s LIHTC program. We’ll provide page-by-page instruction on the mandatory items and reservation, allocation and 8609 application, which are required for applying to VHDA for Low-Income Housing Tax Credits (also known as Housing Credits). You’ll learn tips and tricks to avoid penalty points for common errors such as insufficient documentation, minor mistakes or misunderstood questions. You’ll also have an opportunity to ask questions and receive answers straight from the staff that will be reviewing your application. This class will provide the information you need to ensure you get the points your development deserves. There will be a new application format for 2018, don’t miss these updates!

Oct. 12, 2017  |  1 - 4 p.m.  |  Cost: Free 
VHDA’s Virginia Housing Center, 4224 Cox Rd., Glen Allen, VA 230600
Register

Universal Design Seminar 

Certificate holders who completed VHDA's Universal Design Seminar prior to Jan. 1, 2013, must re-attend in order to be eligible for Universal Design points in the 2018 Tax Credit Application. The seminar will be offered on two different dates for your convenience; please choose the date / location that works best for you.

Charlottesville Class (space is limited):
Nov. 7, 2017  |  12:30 - 3:30 p.m.  |  Cost: $60  (Includes Lunch & Training Materials)
The Omni Charlottesville, 212 Ridge McIntire Rd., Charlottesville, VA 22903 
Register

Richmond Area Class:
Jan. 25, 2018  |  8:30 a.m. - 12:30 p.m.  |  Cost: $60 (Includes Lunch & Training Materials)
VHDA’s Virginia Housing Center, 4224 Cox Rd., Glen Allen, VA 23060 
Register

Architect Certification and Universal Design Plans Submission Requirements 

This new class, presented by VHDA's LIHTC Allocation department, will cover every item required on the Architect Certification and the required elements needed in the Universal Design plans. We’ll provide a question-by-question explanation of the architect certification as well as the format you must use to present your plans, including examples. This class should be attended by owners and architects who plan to submit an LIHTC reservation application, because the better you understand the requirements, the less likely you are to receive penalty points for incorrect information or errors in your submission. This class will be offered on two different dates for your convenience; please choose the date / location that works best for you.

Charlottesville Class (space is limited):
Nov. 7, 2017  |  3:30 – 5 p.m.  |  Cost: Free
The Omni Charlottesville, 212 Ridge McIntire Rd., Charlottesville, VA 22903
Register

Richmond Area Class:
Jan. 25, 2018  |  1 - 3 p.m.  |  Cost: Free
VHDA’s Virginia Housing Center, 4224 Cox Rd., Glen Allen, VA 23060
Register

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

The Housing Collapse Hit Minorities Hardest — and the Impact is Still Being Felt Across America

The housing market collapse that started in 2006 and led to the deepest recession and worst financial crisis in generations had a disproportionate impact on minority communities that still hampers the ability of low-income households to fully participate in the economy. That’s according to a new study from the Federal Reserve Bank of St. Louis that highlights the lasting impact of the nation’s historic housing downturn on the country’s most vulnerable. Two key factors amplified the effects of the housing slump on minority households — home prices often tumbled even more than average in urban, low-income areas, and minorities often held a larger share of their wealth in housing than whites.

These Four Trends in Rental Housing Have Big Implications for the Growing Affordable Housing Crisis

The rental housing landscape in America is rapidly changing: new people are becoming renters and many properties are aging. Meanwhile, the pace at which new rental housing supply is being created can’t meet growing demand. This supply shortage is particularly acute for affordable housing, leading to an ongoing crisis. Tens of millions of Americans live in housing they cannot afford. A recent report on the huge housing cost burden felt by renters and homeowners indicated: almost 20 million households are extremely cost burdened, meaning they spend at least half of their income on their rent or mortgage.
1. Renters don’t look like they used to.
2. Supply isn’t keeping pace with demand.
3. Beyond building new supply, we need to fix what we already have.
4. Single-family rentals are gaining popularity.

House Committee Unanimously Approves Bill to Classify Municipal Bonds as High-Quality Liquid Assets 

The House Financial Services Committee on July 25 unanimously voted to report the Municipal Finance Support Act of 2017, H.R. 1624, to the full House of Representatives for consideration. The legislation, introduced by Representative Luke Messer (R-IN), would allow large banks to count some of their municipal bond investments, including tax-exempt housing bonds, as high-quality liquid assets (HQLAs) under federal bank liquidity standards. NCSHA and several other state and local organizations supported the bill. H.R. 1624 would modify a regulation the Federal Reserve, the Department of Treasury, and the Federal Deposit Insurance Corporation (FDIC) released in October 2014 to ensure that large banks hold enough liquidity to continue making payments during periods of financial stress. Under the rule, banks with at least $250 billion in assets (or $10 billion in foreign exposure on their balance sheet) must maintain a minimum liquidity coverage ratio (LCR) comprised of certain financial investments that are considered HQLAs. The rule took effect at the beginning of 2017.

Senate Appropriations Subcommittee Approves FY 2018 HUD Funding Bill 

On July 25, the Senate Appropriations Subcommittee on Transportation and Housing and Urban Development (THUD) approved by voice vote its Fiscal Year (FY) 2018 funding bill. Though the bill is not yet publicly available, the Subcommittee's press release says the bill fully funds Section 8 rental assistance and funds the HOME Investment Partnerships program (HOME) at $950 million, the same as its enacted FY 2017 funding level. The Senate Subcommittee-approved THUD bill includes $40.2 billion in discretionary funding for HUD programs, an increase of $1.4 billion above the FY 2017 enacted level. During the markup, Subcommittee Chairman Susan Collins (R-ME) explained that much of this increase was needed to renew existing rental assistance contracts, which now consume more than 84 percent of the HUD budget.

Strong HOME and Section 8 Outcomes in Senate Appropriations Committee-Approved FY 2018 THUD Funding Bill

The Senate Appropriations Committee recently unanimously approved its Fiscal Year (FY) 2018 Transportation and Housing and Urban Development (THUD) funding bill, providing $950 million for the HOME Investment Partnerships program, the same as its enacted FY 2017 funding level—a strong outcome NCSHA and other program stakeholders helped achieve in a difficult fiscal environment.  The Committee adopted the THUD Subcommittee-approved bill with only minor amendments that did not change HUD program funding levels. The Senate Appropriations Committee-approved THUD bill and accompanying report language are still not publicly available; however, the Committee’s press release confirms the HOME outcome, says the bill fully funds Section 8 rental assistance, and reports other program funding levels.