ORGANIZATIONAL STRATEGIC PLAN 2026–2028
Context: Market Conditions and Strategic Imperatives Key trends in affordable multifamily housing—tightening resources, increasing costs, and expanding housing need—are reshaping NHPF’s strategic outlook. Together, they create a challenging environment that necessitates a resilient and disciplined organizational strategy.
CHALLENGING MARKET SHIFTS Funding for affordable housing development has become increasingly scarce. Since 2020, tax credit equity prices have declined by approximately 8 percent, widening capital stack gaps. 1 At the same time, local and federal governments are being forced to reduce gap funding programs. Twenty of the 25 largest cities in the United States projected budget deficits for FY 2026. 2 Rising costs further exacerbate these funding gaps. Interest rates have increased by roughly 2.5 percentage points since March 2022, making capital stacks more complicated and increasing demand for soft funding. 3 Multifamily construction costs have increased by approximately 47 percent since 2018, with the steepest increases following the COVID 19 pandemic. 4 Inflation is not only occurring on the construction side but also on the operations side, as high insurance costs and utilities, among other items are squeezing NOI. 5 As resources tighten and costs rise, housing need continues to expand beyond the lowest income households. The number of cost burdened renters earning between $50,000 and $100,000 annually doubled between 2018 and 2023, signaling increasing pressure across income bands. 6 NHPF’s mission of preserving and creating sustainable, quality housing that is affordable to low- and moderate-income households, including seniors, has never been more salient, and finding ways to expand organizational impact is paramount. The growing public need to invest in workforce housing, broadens what the implementation of NHPF’s mission looks like.
WHAT WE LEARNED FROM OUR INDUSTRY NHPF engaged a handful of peer nonprofit affordable housing developers and owners to understand their responses to a shifting environment in three key areas— approach to growth; approach to resident services and approach to non-LIHTC financing structures. NHPF’s peers are broadly responding to market trends by shifting focus from volume of deals to economic sustainability and quality of deals. Peer interviews conducted as part of the strategic planning process surfaced a range of approaches, including: • Pursuing growth strategies that include mixed income and non LIHTC development to improve cash flow and long-term sustainability; • Geographic expansion to mitigate funding volatility risks; and • Operational efficiency and cost-conscious decision-making discipline within existing portfolios. Peer approaches to resident services also vary considerably, though common themes include closely coordinating between resident services, development, and asset management functions to inform cost projections, pursuing a range of project-level, corporate and philanthropic funding strategies, and seeking efficiencies in how resident services are staffed and administered.
1 Novogradac Q1 2016–Q3 2025 2 New York Times, Pew Charitable Trust, BisNow, Texas Public Radio, LAist, National League of Cities, National Association of Housing and Redevelopment Officials 3 FRED Economic Data (St. Louis Fed), “Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity, Quoted on an Investment Basis” 2022-2025 4 FRED Economic Data (St. Louis Fed), “Producer Price Index by Commodity: Inputs to Industries: Net Inputs to Multifamily Residential Construction, Goods” 2018-2025 5 Fannie Mae, “Multifamily Economic and Market Commentary,” May 2024; Yardi Matrix Insurance Premiums 2024 6 ACS 5 Year Estimates 2018 and 2023
THE NHP FOUNDATION
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