Affordable Housing Finance asked six housing leaders to share their expectations for the new year.
Ismael Guerrero, President and CEO, Mercy Housing
This year is an opportunity to save affordable housing projects that were impacted by inflationary and interest rate pressures while positioning new projects for development in two to three years. We should build upon foundations that enable and accelerate affordable housing development. Our industry faced challenges in 2022 with supply chain disruptions, labor shortages, and increasing interest rates that delayed projects. In order to advance these projects and future ones, we need to work with political, municipal, and development partners to: 1. Encourage Congress and federal government supporters to create bipartisan tax credit expansion and reform; 2. Encourage local governments to prioritize funds from the Inflation Reduction Act that can close funding gaps for new development; 3. Work with local government partners on supply-side solutions that reduce costs and expedite development, including land-use, zoning, and entitlement reforms; and 4. Finally, we also need to invest in supportive services like health care, mental health, and child care that will help stabilize residents and improve their educational and economic outcomes. That’s how we will build more stable, sustainable communities.
Geoff Brown, President and CEO, USA Properties Fund
I’m also hopeful that the industry can get some legislation passed on the federal level that allows for more tax-exempt bonds and 9% credits, which would help pave the way for more affordable housing. However, there is still a lot of public and private capital available because of the enormous need for affordable housing. And, as an industry, we need to take advantage of this by continuing to work on creative financial models for both developing and preserving affordable housing.
Finally, I also expect more opportunities to provide much-needed workforce housing for the missing middle, which is greatly needed nationwide, especially in high-cost areas such as the West Coast and Northeast.
Sunia Zaterman, Executive Director, Council of Large Public Housing Authorities
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Lori Chatman, Interim Co-CEO of Enterprise Community Partners
As we look ahead to 2023, economic stressors—a possible recession, high inflation, rising interest rates, and an ongoing affordability crisis—could have a major impact on the housing market, and particularly on lower-income and working-class families. But there are bright spots for affordable housing: Better buying opportunities could lead to higher production and lower costs; low-cost debt capital offered by Community Development Financial Institutions is increasingly sought after; growing bipartisan support for expanding the low-income housing tax credit could help create more rental homes in every community; and new resources from the Inflation Reduction Act will help make affordable homes more resilient against future disasters. The affordable housing industry is creative, resilient, and prepared to bring our full power to bear on the national affordability crisis.
Stephanie Wiggins, Managing Director and Head of Production for Agency Lending, PGIM Real Estate
