A Decade of Rental Housing Vulnerability

Lessons Learned from Financial Crisis to Coronavirus: Results of a Survey of Key Industry Stakeholders

A Decade of Rental Housing Vulnerability Lessons Learned from Financial Crisis to Coronavirus Results of a Survey of Key Industry Stakeholders

The NHP Foundation & Enterprise Community Partners | A Decade of Rental Housing Vulnerability 1

The report reveals seven resilient housing strategies resulting from the survey findings combined with expert input from The NHPF 2021 Symposium participants.





Negative Affordable Housing Policy Impacts

Positive Affordable Housing Policy Impacts 6 Maximizing Impact: Seven Strategies to More Resilient Affordable Housing 7 In Conclusion 13


The NHP Foundation (NHPF) and Enterprise Community Partners

(Enterprise), in concert with Econsult Solutions, recently completed a survey of more than 100 owners, developers, researchers, public officials, and lenders throughout the country involved in the affordable housing ecosystem.

Drawing upon lessons learned from recent policy and program

developments, and direct comments and recommendations from public and policy officials, NHPF and Enterprise sought to identify ways of alleviating housing vulnerability for lower-income renters, particularly renters of color, who despite widespread DEIJ (Diversity, Equity, Inclusion, Justice) efforts, remain largely disenfranchised when it comes to housing.

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The survey focused on policy interventions during three distinct time periods outlined in the chart below:

Key Policy Innovations

Superstorm Sandy

Hurricanes Harvey, Irma, and Maria; 2017 California Wildfires

Neighborhood Stabilization Program

Protecting Tenants at Foreclosure Act Tax Credit Assistance Program

(TCAP) and Exchanqe Capital Magnet Fund

Choice Neighborhoods Initiative

Rental Assistance Demonstration 2015 Affirmatively Furthering Fair Housinq (AFFH) Rule National Housing Trust Fund

2017 Tax Cuts & Jobs Act

LIHTC Change in Income Targeting

Pandemic Eviction Moratoria

Pandemic Direct Rental Assistance


















The report reveals seven resilient housing strategies resulting from the survey findings combined with expert input from NHPF Symposium participants. Support for these strategies from across the affordable housing spectrum will be the catalyst for the kind of affordable housing that will weather the financial, societal, and natural storms we encounter in the future. The road to these strategic recommendations is paved with both negative and positive impacts from the last decade plus. The report will examine these impacts and the role they play in the current affordable housing paradigm.

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Negative Affordable Housing Policy Impacts

Owing to the past decade of significant economic and political swings, not surprisingly, survey participants perceived several policies and trends to have exacerbated housing vulnerability for lower-income individuals and households. • Reduced federal support for housing during most of the last decade. Beginning with the 112th Congress in 2011, HUD experienced either real or nominal funding cutbacks in many of its programs, including the HOME and the Community Development Block Grant programs that have been used to provide gap-filling capital for affordable housing production and preservation. As the federal role was shrinking, cutbacks in state and local budgets due to fiscal stresses, beginning during the Great Recession, meant the overall level of public support for affordable housing shrank. • Suspension of Fannie Mae and Freddie Mac’s equity investments in Low Income Housing Tax Credit (LIHTC) properties upon entering conservatorship in 2008, cited as one trigger for the Great Recession, was viewed as one of the events with the most negative impacts. • Reduced prices for LIHTC as a result of lowered corporate tax liabilities stemming from the 2017 Tax Cuts and Jobs Act and the suspension and ultimate rescission of the Affirmatively Furthering Fair Housing rule. Any action imperiling LIHTC is a tremendous blow as research shows that children whose families use rental assistance to move to lower-poverty neighborhoods are substantially more likely to attend college and earn more as adults.¹ Further, additional years spent in LIHTC housing as a child is associated with an average 3.9 percent increase in the likelihood of attending a higher education program for four years or more, and a 5.2 percent increase in future earnings.² Similarly, for each additional year a teenager’s family used a voucher or lived in public housing they had higher earnings as an adult.³ • Increasing number of higher income renters. The economic boom throughout much of the 2010s brought many higher-income households into center cities, increasing the demand for housing in often limited geographic areas. • Minimal multifamily construction during the Great Recession led to an undersupply of new rental units, with new construction targeting the luxury market and with little older supply trickling down to more affordable levels. Enhanced demand from people willing and able to afford higher-priced housing led to the conversion of many previously affordable rental units into upper market condominiums or apartments. • Tight lending conditions (“credit box”) made it hard for wealthier would-be homeowners to get mortgages, keeping rental demand tight.

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Positive Affordable Housing Policy Impacts

The survey found broad support for greater governmental involvement in facilitating affordable housing. Respondents were particularly supportive of approaches designed to increase its supply.

The highest ranked policies are compared in the chart below:


 Highest Ranked Policies During Three Eras

The Great Recession & Aftermath (2008–2011)

Tax Credit Assistance Program (TCAP) and Credit Exchange (2009)


Extended Unemployment Benefits (2008)


Neighborhood Stabilization Program (2008, 2009, 2010)


Rebuilding in a Divided US (2012–2019)

Rental Assistance Demonstration (2011)


National Housing Trust Fund (2016)


Capital Magnet Fund (revived 2016)


Pandemic & Social Upheaval (2020–2021)

Pandemic Direct Rental Assistance


Increase in Capital for Housing


Utility Cutoff Moratoria


Additionally, those questioned believe that several pandemic-era policies have had greater positive impacts than previous initiatives in supporting affordable housing. On a scale of 1 to 5, with 5 being “outstanding,” respondents rate both the overall increase in housing funding as part of the various stimulus measures and the provision of direct rental assistance through the CARES Act slightly better than “good,” with average rankings of 4.1. Two other recent initiatives—the various federal and state moratoria on evictions and utility cutoffs of households delinquent on their rents/payments—received average ratings of 3.5 or higher. Collectively, the pandemic-era policies had higher average ratings than those implemented in either the Great Recession and Aftermath (2008–2011) or the period characterized as Rebuilding in a Divided US (2012–2109). Respondents believe that the pandemic-era policies have had an overall neutral to positive impact in reducing housing vulnerability (average 3.3 rating). In contrast, the policies of both the Great Recession and Rebuilding in a Divided US periods received negative to neutral ratings (2.6 and 2.7, respectively). The higher ratings for the pandemic era may reflect the adoption of better policies, but it also may be attributable to recency bias; those questioned are likely to be more aware of these newer policies than some of those enacted in the past.

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Maximizing Impact: Seven Strategies to More Resilient Affordable Housing

1. Capitalize on a Readiness to Address Racial Inequity There is a strong willingness to redress historic wrongs that have led to persistent racial and ethnic disparities in accessing and remaining in quality housing. There is also a shared sense of responsibility to address the disparities. The timing is propitious to pursue policies and programs at all levels of government that are designed specifically to reverse decades of redlining, home appraisal discrimination, and unequal access to quality housing, and invest in long under-served populations and places. There may well be much more widespread support than has typically been assumed for such efforts. Among other things, there is a consensus recommendation for strong enforcement and potential expansion of anti-discrimination legislation such as the Fair Housing Act and the Community Reinvestment Act. Nearly 88% of respondents perceive that, relative to the population as a whole, people of color struggle to access and keep affordable housing. Nearly 63% of survey participants believe that such individuals struggle “much more” than others. When asked about the primary causes of these racial and ethnic disparities, nearly 89% of respondents cited long-term racial discrimination in real estate, lending practices, and federal housing policy. Institutional discrimination far outpaced the second and third-most-cited factors: disparities in income and/or employment, and instances of racism or racial bias among landlords and other individual actors. “ Collectively these factors have led to

a significant gap in homeownership rates between white households and households of color, with Black ownership at an all-time low at 42% vs. whites at 70% ownership across all sectors. 4 ”

KIMBERLY L. JONES Social Activist and Author

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More than 89% of respondents consider affordable housing to be a human right and strongly support increased efforts on the part of both the public and private sectors to create and preserve more units for lower-income households. Survey participants overwhelmingly believe that people of color struggle to obtain and retain quality housing to a much greater extent than their white counterparts and the majority (81%) of respondents said they have the ability to address these racial and ethnic disparities in their current position. Among these individuals, 56% feel that alleviating these inequalities is central to how they approach their work, while 32% feel their efforts are constrained by political or other factors. 5 Respondents feel strongly that each key stakeholder in the sector—different levels of government, nonprofit and for-profit developers, lenders, investors, and local citizens (through neighborhood associations)—should bear responsibility for helping to alleviate historic racial and ethnic inequities . At the same time, 86% of those questioned believe that the public sector should have the primary responsibility for furthering greater equity of opportunity. 6 Lenders and investors are viewed as having secondary responsibility for creating a more level playing field, ahead of developers.

Which stakeholder(s) should bear primary responsibility for addressing racial and ethnic disparities in accessing and keeping affordable housing? Racial and Ethnic Disparities in Access to Affordable Housing

Perceptions among developers and property owners:

Perceptions among all other respondents:





N/A: I do not perceive such disparities 16%

N/A: I do not perceive such disparities 3%





The survey found considerable, broad-based willingness on the part of developers, public officials, and other stakeholders to attempt to address these racial and ethnic disparities by facilitating the development of more quality housing that low-income people can afford. At the same time, respondents recognize that achieving that goal will require a mutual commitment from both public and private sector actors.

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2. Redouble Efforts to Assist All Underserved Populations Overall, those participating in the survey contend that the policies and events of the past decade have negatively affected most renter populations. That said, those questioned felt some groups of renters have fared better than others. Respondents believe that veterans and older adults have had their needs at least adequately met, with average scores of 3.5 and 3.0, respectively, on a 5-point scale. Yet those were the only two groups receiving net positive scores. Programs for the formerly homeless and people with disabilities fall just shy of the adequate mark (averaging 2.9), but slightly above the results for people with low incomes in general (2.8). Those questioned felt that immigrants and formerly incarcerated individuals (2.0 each) have been especially poorly served by policies and programs enacted since 2008, followed by people living in rural areas (2.3).


Policies & Programs for Underserved Populations

Formerly homeless and people with disabilities


People with low incomes


People living in rural areas


Immigrants and formerly incarcerated individuals


It is worth noting that housing programs, unlike certain means-tested programs such as Medicare or food stamps, are not automatically available to every eligible person. As a result, there is often a significant delay between the time when a person needs help and when that assistance becomes available. This different treatment of housing relative to other components of the social safety net may explain the consistently low scores for the housing programs’ efficacy in reaching particularly vulnerable individuals. Looking forward, most respondents favored increased funding for voucher-based programs benefiting residents with low incomes, with larger amounts made available for people further down the income ladder. They also advocated for revisiting the income thresholds for various affordability programs, recognizing that even moderate-income households struggle to afford quality housing in certain parts of the country.

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3. Foster Creation/Expansion of Automatic Stabilizers for the Housing Market

Given the difficulty of passing meaningful and impactful legislation during periods of pronounced economic or political strain— such as severe economic downturns or public health emergencies—Ingrid Gould Ellen, NYU Professor of Urban Policy & Planning and Jenny Schuetz, Senior Fellow, Brookings Institute, recommend policies which act as automatic affordable housing stabilizers, beneficial in delivering much-needed and immediate support.

These include making the Tax Credit Exchange Program permanent to facilitate the exchange or return of unused tax credits for cash grants in the event the LIHTC market should bottom out, as occurs during severe economic downturns. Alternatively, automatically increasing allocations of housing vouchers when unemployment rates cross a certain threshold would inject much needed capital into affordable housing markets while supporting residents in a timely fashion. Such automatic stabilizers can be tailored to fit the needs of all stakeholders in the ecosystem while side-stepping the often arduous congressional approvals needed for fresh legislation to address individual crises. 4. Enhance Capital Support, Crucial to Addressing Need Survey participants generally considered the most effective programs to be those that focused on increasing the supply of affordable homes. These policies have taken the form of capital support, such as the TCAP and credit exchange and the Rental Assistance Demonstration (RAD) programs. The former, enacted as part of the American Recovery and Reinvestment Act in 2009 and helped stabilize tax credit-financed housing developments whose future was in jeopardy due to frozen capital markets, was the highest-ranked program implemented during the Great Recession. 7 While TCAP and Exchange was a short-term program designed specifically for a moment of crisis, RAD, which still bears a “demonstration” moniker, has scaled significantly over the past decade, a testament to the value of the program. RAD facilitates private investment in public housing developments, helping to preserve their affordability and habitability for the long term. The program encourages partnerships between public housing agencies, who contribute land to the deals, and mission-aligned nonprofit and for-profit developers, who provide the necessary capital to rehabilitate or redevelop affordable homes on the land.

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“ The RAD program creates vibrant places for people to live that are affordable. ”

MAYOR JUSTIN ELICKER City of New Haven, Connecticut

Going forward, we encourage enhanced funding of LIHTC, the Capital Magnet Fund, National Housing Trust Fund and other programs that facilitate the development and preservation of more affordable rental units.

5. Make Local, Flexible Policy Shifts to Enable Increased Production and Preservation While federal and state governments provide many of the subsidies necessary for affordable housing to be economically viable, local decisions often determine where and how much such housing can be developed. Zoning and building codes are central to the twin questions of availability and affordability. Effective supply-focused initiatives have eased regulatory burdens, such as by modifying land use policies to allow for greater density.

Among the changes respondents would like to see increased:



Accessory dwelling units on existing single-family lots

Those requiring new residential developments to contain a minimum number of affordable units (i.e., inclusionary zoning) Changing suburban land use patterns, in particular, is seen as a critical step in facilitating a more equal distribution of affordable homes across regions. These local funds are often designed to address housing affordability challenges in a manner reflective of how the issues present themselves locally. In many cases, the pools are funded through dedicated tax revenues or bond issuances approved by voter referenda. Some localities have been particularly innovative. In Miami, Florida, the mining of a local cryptocurrency (MiamiCoin) has already generated a $7.5 million revenue stream that potentially can be used for affordable housing, among other uses.

Changes to zoning density limits enabling multifamily properties. 8

Generating local affordable housing funds to augment state and federal resources for the purpose of developing or preserving affordable rental housing.

Use of creative funding sources.

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Addressing the affordability crisis requires different solutions in different markets. In some high-cost markets, it may make sense to raise the income thresholds for eligibility; even many moderate-income households in these areas find themselves housing cost-burdened. Similarly, both very strong and very weak markets may require deeper subsidy for developments to be both affordable and economically viable. In such areas, the public and philanthropic sectors may have to take a larger financial role than they have in the past. Expecting the private, for-profit sector to play as substantial a role may be unrealistic without the ability to leverage other sources of subsidized capital. Tailoring programs to respond to local conditions also requires policy makers to consider more than just the current housing stock and resident incomes. Because investments in housing infrastructure are intended to last for decades, homes and communities must meet both current and future needs while taking considerations of greater resilience and equity into account. “ We have begun to implement higher standards for the types of homes that we build and are leveraging the

resources we have to keep us prepared. It isn’t just resilient infrastructure, but we are providing opportunities to people who will then be able to weather the storm better because they have been able to expand their own experience and expertise. ”


6. Break Down Barriers to Increase Collaborative Efforts Most respondents believe that the public, private, and philanthropic sectors have key roles to play in expanding and preserving the supply of affordable housing. Yet too many existing programs are designed in ways that make collaboration difficult. Programs do not necessarily have similar affordability thresholds, and some prioritize certain types of capital over others. Tweaking regulations to enable programs to augment each other in a relatively seamless way would help considerably, as would revisiting some regulations to make them more consistent across programs. Aligning program rules can make it easier for private-sector actors to work in partnership with the public sector; these joint efforts tend to have greater impacts when the two sectors draw upon their respective strengths and capacities.

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Most survey participants (59%) contend that neither the public nor the private sector currently does enough to support affordable rental housing. A smaller majority (54%) feels that, going forward, the two sectors should bear equal responsibility in supporting such housing. Yet a substantial minority of respondents (43%) believes that the responsibility should lie primarily with the public sector in that regard. There is broad agreement that each of the major actors in the affordable housing space should be more active than it is currently. More than 80% of survey participants want various public sector actors—each level of government, as well as mayors and city councilmembers – to take a more active role in furthering the development and preservation of affordable housing. Housing Agency Partners who took part in The NHPF Symposium voiced several ways that they break down barriers and increase collaboration, such as creating renter education efforts in conjunction with realtors and other stakeholders and partnering with CDFIs like LISC and others to bring technical assistance and pre-development funds to municipalities that are trying to build capacity. “ We work with local government to use their powers in terms of land use and zoning decisions to provide density bonuses and preserve affordable rental housing, and increase the density available for redevelopment. ” —MICHAEL HAWKINS Managing Director, Community Outreach, Virginia Housing At the same time, 83% of respondents believe that the philanthropic sector also needs to take a more active role in promoting residential affordability than it has in the past. Those questioned contend that virtually all the major actors have taken a progressively greater role in facilitating affordable housing in the past decade plus, and all were seen as doing more during the pandemic era than during the 2010s. 7. Be Open to Bold, New Funding Ideas It could be argued that the most creative way to finance affordable housing is also one of its most enduring. The LIHTC program, created over 30 years ago, recently survived the chopping block and is included in the current Build Back Better Reconciliation Legislation and serves as inspiration to develop more creative financing tools for affordable housing. According to the survey, respondents generally considered the most effective programs to be those that focused on increasing the supply of affordable homes, including through preserving the ones that are most at risk of loss.

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One municipality taking this recommendation seriously is Miami, where its introduction of a local cryptocurrency, MiamiCoin, is already showing promising results. “ In just under 60 days, MiamiCoin

has already generated about $7.5 million for the city and can be used for affordable housing. I think that’s something that would be an amazing new revenue source to continue to build affordable housing in a city that so desperately needs it. ”

MAYOR FRANCIS X. SUAREZ City of Miami, Florida

It was also recommended by participants in The NHP Foundation Symposium that the U.S. look to other countries to learn from policies which support stable, affordable rental housing. For example, Jenny Schuetz at Brookings wrote a series of case studies on rental housing specifically in six developed countries. And the U.S. stands out as “having spent the least amount of GDP on housing compared to other rich countries.” With 89% of those surveyed believing that housing is a basic human right, we challenge everyone in the equation to seek innovative solutions to fund such housing going forward.

In Conclusion

We are currently living in a cautionary tale. In his new book, The Contagion Next Time, Sandro Galea, Dean of the Boston University School of Public Health, draws a straight line from failures in public health and the legacy of Jim Crow legislation to the devastation wreaked on society by the Pandemic. “Investing in the healthiest population possible is an act of national security against a future pandemic”—and it begins with an investment in providing housing that will help ensure healthier, more resilient communities. It is incumbent not simply upon all of those in the affordable housing equation—but society in general— to step up and take a commanding interest in effecting substantive change. As long as inequities and vulnerabilities remain in some parts of society, all of society is vulnerable.

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About the Survey

Enterprise Community Partners and Econsult jointly developed the survey in the summer of 2021 in consultation with The NHP Foundation. The survey contained a series of primarily closed-end questions relating to various policies and events that have influenced the residential marketplace during the past 15 years and asked normative questions about perceived inequities in the affordable housing marketplace and the extent to which different actors have a responsibility to address them. Enterprise and Econsult sought to obtain a wide range of perspectives from those working within the affordable housing industry. To that end, they sent the survey to approximately 700 individuals involved as for-profit or nonprofit developers, lenders, elected officials, other public officials, researchers, and advocates. They identified potential respondents through lists of contacts developed by Enterprise, NHPF, and other key informants, many of whom subsequently completed the on-line survey. During the approximately four weeks that the survey was open, we received valid responses from 103 separate individuals.


1 F ischer, Will, Douglas Rice, and Alicia Mazzara. “Research Shows Rental Assistance Reduces Hardship and Provides Platform to Expand Opportunity for Low-Income Families,” 2019 n.d., 12. 2 D erby, Elena. “Does Growing Up in Tax-Subsidized Housing Lead to Higher Earnings and Educational Attainment?” SSRN Scholarly Paper. Rochester, NY: Social Science Research Network, March 11, 2020. https://doi.org/10.2139/ssrn.3491787 . 3 F ischer, Will, Douglas Rice, and Alicia Mazzara. “Research Shows Rental Assistance Reduces Hardship and Provides Platform to Expand Opportunity for Low-Income Families,” 2019 n.d., 12. Research review published by the Center for Budget and Policy Priorities 4 https://ncrc.org/60-black-homeownership-a-radical-goal-for-black-wealth-development 5 T he other 12% have the ability to address the inequalities but do not consider doing so to be a primary area of focus. 6 Interestingly, while at least 90% of respondents in all other categories believe that the public sector should bear primary responsibility for addressing racial and ethnic inequities in affordable housing, among residential owners and developers, the figure drops to 68%. 7 Interestingly, the TCAP and credit exchange programs received much stronger support from those in the finance sector (an average 4.36 rating) than those respondents from the public sector (3.44). 8 R espondents’ views toward changes to land use policies were the most similar of all the policy responses surveyed, with a variation of only 0.2 across the subgroup averages.

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