FOR IMMEDIATE RELEASE: August 25, 2014
CONTACT: Bob Palmer, Policy Director, Housing Action Illinois, 312-282-3959 (cell) or email@example.com
Report: Affordable Rental Housing Still Elusive For Lowest Income Americans
According to Housing Spotlight: The Affordable Rental Housing Gap Persists, released today by the National Low Income Housing Coalition (NLIHC) and Housing Action Illinois, there is a deficit of 321,394 rental units affordable and available to extremely low income households in Illinois, those with income at or below 30% of area median income. Statewide, there are only 30 affordable and available units for every 100 extremely low income renter households.
In the Chicago metropolitan area, the situation is even grimmer, with just 27 affordable and available units for every 100 extremely low income renter households.
For the first time, this edition of Housing Spotlight also highlights how it is nearly impossible for renters with income at or below 15% of area median income to find housing that they can afford. These renters are considered deeply low income by NLIHC. They are most often elderly or disabled households living on fixed incomes, such as Supplemental Security Income (SSI).
In Illinois, there are just 16 affordable and available units for every 100 deeply low income households and 90% spent more than half of their income on housing costs. (In the Chicago metropolitan area, there are 17 affordable and available units for every 100 deeply low income households and 89% spent more than half of their income on housing costs.)
NLIHC and Housing Action Illinois are advocating to close the gap in rental housing affordable and available to extremely low income households through funding the National Housing Trust Fund (NHTF). The NHTF was authorized by Congress in 2008, but remains unfunded.
The NHTF will provide states with funds to build, preserve, and rehabilitate rental homes. It is a permanent program, designed to have a dedicated source of funding not subject to the annual appropriations process. At least 90% of the funds must be used for rental housing. Up to 10% can be used for home ownership activities. At least 75% of the funds for rental housing must benefit extremely low income households and all funds must benefit very low income households.
Funding sources for the NHTF being currently pursued include Fannie Mae and Freddie Mac, any successors to Fannie Mae and Freddie Mac created through housing finance reform legislation and mortgage interest deduction reform.
Fannie Mae and Freddie Mac have a statutory obligation to make contributions to the NHTF. Their obligation was suspended in 2008 due to their financial state. Given Fannie Mae’s and Freddie Mac’s return to profitability, NLIHC and other NHTF supporters have called for the suspension to be lifted and for contributions to the NHTF to begin. NLIHC estimates that as of the fourth quarter of 2013, Fannie Mae and Freddie Mac owe $761 million to the NHTF.
The director of the Federal Housing Finance Agency (FHFA), former Congressman Mel Watt, has the sole authority to lift the suspensions. In July 2013, NLIHC, the Right to the City Alliance, and three individual plaintiffs sued the then acting director of the FHFA, Edward DeMarco, in federal court, asking the court to lift the suspension. The lawsuit is ongoing.
NLIHC and other NHTF supporters are also working to ensure that the NHTF and funding for it are included in any new housing finance system. Housing finance reform legislation introduced in the Senate and that passed out of the Senate Banking Committee, S. 1217, would provide an estimated $3.75 billion a year for the NHTF.
Changes to the mortgage interest deduction (MID) are on the table as part of the debate on comprehensive tax reform and deficit reduction. The challenge is to assure that any revenue gained by changing the MID stays in housing and is not used for other purposes.
Established in 1974 by Cushing N. Dolbeare, the National Low Income Housing Coalition is dedicated solely to achieving socially just public policy that assures people with the lowest income in the United States have affordable and decent homes.
Housing Action Illinois is a statewide coalition formed to protect and expand the availability of quality, affordable housing throughout Illinois. Their members include housing counseling agencies, homeless service providers, developers of affordable housing and policymakers.
The report is available at http://nlihc.org/article/housing-spotlight-volume-4-issue-1. More information about the NHTF is available at http://nlihc.org/issues/nhtf.