Weekly update from the National Housing Conference

In this issue

June 11, 2023

Issue 92-21

· Neighborhood Homes Investment Act reintroduced in the House

· Bipartisan legislation introduced to increase homeownership opportunities 

· Shaun Donovan named new Enterprise Community Partners CEO and President

· Five agencies seek comments on joint appraisal reconsideration guidance

· Legislation introduced in Senate to provide security deposit assistance

· Agencies release regulatory guidance on third-party risk management

· Freddie Mac introduces mortgage product for Tribal communities 

· HUD announces $45 million in funding to fight homelessness

· HUD makes $22.5 million available for Jobs Plus 

Chart of the week: Housing Opportunity Index shows continuing affordability challenges 

Mortgage affordability calculators will never be the same

By David M. Dworkin, President and CEO, NHC

Mortgage affordability calculators will never be the same thanks to a revolutionary new resource developed by the National Housing Conference (NHC) and the Black Homeownership Collaborative, as NHC’s Senior Policy Director Charles Lowery, Jr., reported last week. The game-changing 3by30 Mortgage Calculator, accessible at www.3by30.org, allows any interested homebuyer to assess how much of a mortgage they can afford without ever having to guess how big a down payment they will need. One of the biggest obstacles to becoming a homeowner is the lack of understanding surrounding down payment requirements. However, the 3by30 Mortgage Calculator successfully addresses this issue by completely eliminating the need for guesswork.

In this note, I’m going to explain how this incredible tool works, but first, let’s look at why it is so important. According to a survey by Clearpath Strategies and USMI, 46% of African Americans identified the lack of intergenerational wealth for a down payment as a significant barrier to homeownership. When asked “based on what you know, what is the minimum down payment required to qualify for a mortgage,” 42% of African Americans said it was more than 20% and 21% said they did not know. The numbers aren’t a lot better for others. Only 18% of Whites and 14% of Hispanics correctly said that the down payment required was 5% or less, compared to 14% of African Americans. Clearly, everyone has significant misconceptions about down payments.

The 3by30 Mortgage Calculator never asks how much you need to put down, it tells you. You start by entering your gross annual income, monthly debts, and the amount you have saved for a down payment. Then, using the Down Payment Resource® website, you can identify available down payment assistance (DPA) in your community. In Washington, D.C. alone, there are 15 programs that provide at least $9,000 in DPA. For low-income D.C. residents, the assistance can exceed $100,000. The 3by30 Mortgage Calculator also allows you to estimate your mortgage interest rate, credit score, property taxes, homeowners insurance, and mortgage insurance.

Using the 3by30 Mortgage Calculator, a family with a combined income of $120,000, $25,000 in savings for a down payment, and $9,000 in DPA, can afford a $361,000 home with a monthly payment of $2,998 – less than they may already be paying in rent. The required down payment will be less than 5%, specifically $16,842, and there will be additional closing costs of $17,158. This differentiation between down payment and closing costs is a common stumbling block for first-time homebuyers who may be unaware that closing costs can exceed the down payment itself...more.

News from Washington | By Brittany Webb

Neighborhood Homes Investment Act reintroduced in the House

Reps. Mike Kelly (R-Pa.) and Brian Higgins (D-N.Y.) reintroduced the bipartisan Neighborhood Homes Investment Act (Neighborhood Homes) which creates a new tax incentive that would produce 500,000 starter homes in under-resourced communities over the next decade. Neighborhood Homes provides a tax credit that covers the "appraisal gap," or the delta between what it costs to build or rehabilitate a home and the market value of the home upon completion. Every state has communities where homes are in too poor a condition and where property values are too low to support new construction or substantial renovation. Designed after the successful Low-Income Housing Tax Credit, the new tax credit makes projects in these communities feasible, thereby reducing neighborhood "blight" and increasing the inventory of affordable starter homes for sale.

“Struggling urban, rural, and suburban communities face a dilemma,” said Buzz Roberts, President and CEO of the National Association of Affordable Housing Lenders. “They need new and renovated homes to revitalize, but home values are too low to support development costs. Neighborhood Homes offers a straight-forward way to break the vicious cycle of neighborhood decline.”

Original cosponsors of the House version of the bill are Reps. Claudia Tenney (R-N.Y.), Dan Kildee (D-Mich.), Randy Feenstra (R-Iowa) and Dwight Evans (D-Pa.) Identical legislation was introduced by Sens. Ben Cardin (D-Md.) and Todd Young (R-Ind.) in March.

Bipartisan legislation introduced to increase homeownership opportunities 

Sens. Catherine Cortez Masto (D-Nev.) and Bill Cassidy (R-La.) introduced the Affordable Housing Bond Enhancement Act. If passed, the bill would strengthen the Mortgage Revenue Bond (MRB) and Mortgage Credit Certificate (MCC) programs, making homeownership more accessible through efficiency improvements. The legislation specifically would increase the MRB home improvement loan limit, allow MRBs to be used for refinancing, simplify the calculation of a borrower’s MCC benefit, and eliminate lenders’ MCC reporting requirements, among other reforms.

“Mortgage Revenue Bonds and Mortgage Credit Certificates historically have been the state housing finance agencies’ primary tool for financing affordable homeownership opportunities for working families, having helped nearly four million home buyers combined,” said Stockton Williams, Executive Director of the National Council of State Housing Agencies. “This legislation will enact a series of simple, commonsense reforms to the MRB and MCC programs that will allow HFAs to better stretch their resources and help more underserved households.”

Shaun Donovan named new Enterprise Community Partners CEO and President

Enterprise Community Partners announced Shaun Donovan, former Secretary of the U.S. Department of Housing and Urban Development (HUD), will be its next CEO and President, effective Sept. 1. Donovan’s career in housing has spanned 30 years, including serving as Director of the U.S. Office of Management and Budget and Commissioner of the New York City Department of Housing Preservation and Development.

“Coming to Enterprise is, in a way, coming home for me,” said Donovan. “Housing touches everything in a person’s life. A good education, a good job, a healthy, prosperous life – all of it revolves around having a safe, stable place to live. Unlike any other time in my life, housing affordability is on the national radar. It’s a moment I’ve been preparing for throughout my whole career. I am honored to work with my new colleagues, our partners, developers, and investors to achieve our shared vision of a country where home and community are steppingstones to so much more.”

Five agencies seek comments on joint appraisal reconsideration guidance

Five federal agencies announced a joint request for information on their proposed reconsiderations of value (ROV) guidance for residential real estate transactions. ROVs are requests from a financial institution to an appraiser or other preparer of a valuation report to reassess the property’s valuation based on deficiencies or other information that may affect the estimated value. They can be initiated by a consumer complaint or a request by the loan officer or lender representative.

The announcement came from the Board of Governors of the Federal Reserve System, the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Office of the Comptroller of the Currency. It comes a week after the Biden Administration announced new actions from its Interagency Task Force on Property Appraisal and Valuation Equity (PAVE) to address racial bias in evaluations, including promoting industry-wide consistency for ROV processes to increase consumer knowledge and empowerment when valuation is lower than expected.

“The PAVE Task Force agencies’ action is an important step in empowering consumers and promoting fair appraisals,” said Nikitra Bailey, Executive Vice President of the National Fair Housing Alliance (NFHA), after the PAVE announcement. “Recently, NFHA and other leading civil rights and consumer advocates provided feedback to FHA to further protect consumers during the Reconsideration of Value process and urged FHA to work with the other PAVE Task Force agencies to issue consistent, industry-wide guidance. We applaud the federal financial regulators and the Federal Housing Finance Agency (FHFA) for joining FHA in the ROV initiative. We also urge the U.S. Departments of Agriculture (USDA) and Veterans Affairs (VA) to soon follow suit.”

Comments on the guidance are due 60 days after publication in the Federal Register.

Legislation introduced in Senate to provide security deposit assistance

Sen. Martin Heinrich (D-N.M.) introduced the Delivering Essential Protection, Opportunity, and Security for Tenants (DEPOSIT) Act, which would provide rental home security deposit assistance to low-income renters. The legislation expands both the Housing Choice Voucher Program and the Home Investment Partnerships Program to make more federal resources available to housing authorities for revolving funds that will provide security deposit assistance to low- and very low-income renters. It further directs the U.S. Department of Housing and Urban Development (HUD) to study alternatives to security deposits. The bill’s cosponsors include Sens. Ben Ray Luján (D-N.M.), Alex Padilla (D-Calif.), and Peter Welch (D-Vt.). Rep. Barbara Lee (D-Calif.) introduced the DEPOSIT Act in the U.S. House of Representatives earlier this year.

“NMHC has long supported reforms to the Housing Choice Voucher program and other HUD programs that will help apartment residents and their families overcome the challenges of securing attainable housing due to the national shortage of rental housing. The DEPOSIT Act is an important step toward making HUD more effective in supporting households in need of a safe and affordable apartment home,” said National Multifamily Housing Council (NMHC) President Sharon Wilson Géno. NMHC endorsed the Act.

Agencies release regulatory guidance on third-party risk management

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency jointly released final guidance to banking organizations on managing risks associated with third-party relationships and specifically includes information on financial technology companies. The guidance includes principles and considerations for banking organizations to manage third-party relationships in several areas including planning, due diligence and third-party selection, contract negotiation, ongoing monitoring, and termination. It contains examples to help banking organizations, particularly community banks, align their practices with the nature of their third-party relationships.

Freddie Mac introduces mortgage product for Tribal communities 

Freddie Mac announced a new mortgage product, HeritageOne, to foster more homeownership opportunities on Tribal lands. The product offers financing options for single-family properties on rural Tribal lands and will provide financial counseling and other resources for Tribal members. To qualifyat least one borrower occupying the property as a primary residence must be enrolled in a federally recognized Tribe. As part of their 2022-2024 Duty to Serve plans, Freddie Mac identified providing more housing support for Indian Country.

“The limited access to affordable mortgage financing options has affected our communities for far too long and it has impacted the ability of our members to build generational wealth through homeownership,” explained Tawney Brunsch, Executive Director of Lakota Funds, a Native community development financial institution. “HeritageOne can help break down these walls, providing greater access to responsible homeownership and broader economic opportunities through financial counseling for our historically underserved communities. We look forward to making HeritageOne widespread in tribal lands.”

Sonu Mittal, Senior Vice President of Acquisitions at Freddie Mac, noted HeritageOne helps break new ground in expanding opportunities to traditionally underserved communities. “Our commitment to make home possible for Native American families not only requires long-term planning and prudent execution, but strong partnerships with industry members and tribal leaders. Through this collaboration, we can help create more affordable mortgage options in tribal lands and rural areas,” he said

HUD announces $45 million in funding to fight homelessness

The U.S. Department of Housing and Urban Development (HUD) announced $45 million in funding to 135 public housing authorities and Continuum of Care communities across the United States. The money will provide 3,379 Stability Vouchers for households experiencing, or at risk of, homelessness. The announcement follows the launch of the 2022 House America campaign, a national initiative placing over 100,000 households into permanent housing and adding over 40,000 units of affordable housing into development.

“These vouchers will enable communities to partner with health and housing agencies to coordinate efforts to reduce homelessness and help thousands of people move off the streets into permanent housing,” said HUD Secretary Marcia Fudge. 

HUD makes $22.5 million available for Jobs Plus 

The U.S. Department of Housing and Urban Development (HUD) announced it’s making $22.5 million available for Public Housing Authorities to assist families through the Jobs Plus program. The money will support work readiness and help connect public housing residents to services to improve their economic mobility. The Jobs Plus program provides employment, education, and financial empowerment services with rent incentives, building assets for renters. “Programs like Jobs Plus help individuals and families to reach their goals, this funding notice allows public housing authorities to become a resource to their residents so that they can thrive,” said HUD Secretary Marcia Fudge.

Chart of the week

Housing Opportunity Index shows continuing affordability challenges 

The National Association of Home Builders’ (NAHB) Eye on Housing blog examined housing affordability during 2023’s first quarter, finding that 45.6% of homes sold between January and March were affordable to families earning the U.S. median income of $96,300. The post presents the NAHB/Wells Fargo Housing Opportunity Index (HOI). It shows that while the HOI is higher than the 38.1% HOI of Q4 of 2022, it remains significantly lower than at the same time last year when the HOI reached 56.9%, indicating ongoing housing affordability challenges.

What we're reading

An article in The Hill explains how the debt ceiling deal could impact housing affordability, noting the deal restarts paused student loan debt payments for millions of borrowers. Many were using the payment pause to save up for down payments on first homes or cover increased rent costs. Student loan debt is a primary barrier for many younger buyers pursuing homeownership.


The Consumer Financial Protection Bureau issued a new spotlight covering the use of artificial intelligence chatbots in banking. The spotlight explains many financial institutions use chatbots to cut costs and offer customer service with pre-populated answers to common inquiries. However, their effectiveness wanes as customers have more complex questions, and many consumers are expressing frustration with finding answers to their financial questions when being routed back to the chatbot rather than a customer service representative. Financial institutions potentially violate their legal obligations to consumers and erode trust when relying on such artificial intelligence.


The National Multifamily Housing Council and Enterprise Community Partners launched a new resource for apartment firms, policymakers, and community advocates to help advance housing equity in the multifamily industry. The guide, titled “Opening Doors of Opportunity: A Guide for Advancing Housing Equity in the Multifamily Industry,” offers specific ways to improve outcomes through the multifamily sector. The resource divides actions and practices into development and location, property management and operations, investment and financing, and policy.

The week ahead

Monday, June 12

Government Affairs Update - Q2 Webinar (NMHC), 2:30 - 3:30 pm ET

Housing First Series (Urban Institute), 2:30 - 3:30 pm ET


Tuesday, June 13

2023 Housing Credit Connect (National REIA), in person in Seattle, WA

Public Housing Manager Training (NAHRO), 1 - 5 pm ET

Preservation Next Colorado Academy: Navigating Rehabilitation of SMMF Properties (Enterprise Community Partners), 2 - 3:30 pm MT


Wednesday, June 14

2023 Housing Credit Connect (National REIA), in person in Seattle, WA

Our Places of Impact CoP: Advancing Equity for Community-Led Initiatives (HUD Exchange), 1 - 2 pm ET

Public Housing Manager Training (NAHRO), 1 - 5 pm ET

PHA Occupancy Webinar Series: Best Practices for Achieving Shorter Vacant Unit Turnaround Time (HUD Exchange), 1:30 - 3 pm ET

2023 ConnectHomeUSA - Internet for All: Workforce Development Opportunities (HUD Exchange), 2 - 3:30 pm ET

Rural Rental Housing Preservation Academy: Strategies for 515 Preservation: Case Studies (Enterprise Community Partners), 2 - 3:30 pm MT

MidYear Know Before You Go (National REIA), 2 - 3 pm ET


Thursday, June 15

2023 Housing Credit Connect (National REIA), in person in Seattle, WA

CDBG-CV Problem Solving Clinics (HUD Exchange), 12:30 - 5:30 pm ET

2023 Equitable Housing Finance Plans Listening Session (FHFA), 1 - 4 pm ET

Introduction to the CDBG Income Survey Toolkit (HUD Exchange), 1 - 2:30 pm ET

Public Housing Manager Training (NAHRO), 1 - 5 pm ET

Housing Counseling Webinar: Providing Counseling on Manufactured Housing Options (HUD Exchange), 2 - 3 pm ET

HOPWA and NSPIRE Webinar Series: Implementation of NSPIRE (HUD Exchange), 3 - 4:30 pm ET

2023 Annual Meeting (WHF), 5:30 - 7 pm ET in person in Washington, DC


Friday, June 16

COVID-19 Planning & Response for Homeless Assistance Providers Office Hours (HUD Exchange), 2:30 - 4 pm ET


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