The U.S. Department of Housing and Urban Development (HUD) is calling for expanded housing supply as it alters its approach to an aspect of fair housing.
On Monday, HUD announced a call for feedback on the Affirmatively Furthering Fair Housing (AFFH) rule, which is currently under review. The AFFH changes, if enacted, would “encourage actions that increase housing choice, including through greater housing supply,” according to an agency statement, as well as assign more control to localities and reduce regulation. AFFH was finalized in 2015.
In the announcement, HUD Secretary Ben Carson accentuated the development of housing “across all communities.”
“HUD believes very deeply in the purposes of the Fair Housing Act and that states, local governments and public housing authorities further fair housing choice,” said Carson. “HUD’s 2015 rule often dictated unworkable requirements and actually impeded the development and rehabilitation of affordable housing. It’s ironic that the current AFFH rule, which was designed to expand affordable housing choices, is actually suffocating investment in some of our most distressed neighborhoods that need our investment the most. We do not have to abandon communities in need. Instead we believe we can craft a new, fairer rule that creates choices for quality housing across all communities.”
According to the agency, AFFH currently is “highly prescriptive” and “ineffective,” and has hindered housing inventory and opportunity, as a result.
Affordability challenges have crept up in recent years, with the most affordable homes in scant supply. According to the National Association of REALTORS® (NAR), existing-home inventory in June was at 4.3 months’ supply—behind what demand dictates. Moreover, 71 percent of Power Brokers in RISMedia’s 2018 Power Broker Report & Survey cited the dearth of homes as their most pressing problem.
“In 2018, as we recognize the 50th anniversary of the Fair Housing Act, NAR continues to support a housing market free from discrimination, including the Fair Housing Act requirement for HUD to administer its programs in a manner that affirmatively furthers fair housing,” says NAR President Elizabeth Mendenhall. “NAR recognized the role that 20th century zoning and land-use decisions had in creating segregated communities, many of which remain segregated today.
“As such, we believe that an effective rule implementing these fair housing requirements is needed, and we will remain focused on preserving and expanding housing opportunities while working closely with Congress and the Trump Administration to address affordability concerns and outdated, inappropriate or overly restrictive zoning requirements, and help sustain homeownership,” Mendenhall says.
According to a recent report by Zillow, areas with burdensome land-use regulations, including density limits, are associated with higher home values.
HUD began its effort to eliminate inefficiencies in 2017. Recently, the agency revoked a tool authorities had been using in their assessments of fair housing.
Suzanne De Vita is RISMedia’s online news editor.