Issues & Publications
Programs & Initiatives
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Affordable Housing Trust Fund - Issue Summary
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| What is the fundamental issue? |
| Legislation has been introduced that would create a National Affordable Housing Trust Fund. This Fund would be independent from federal appropriations. It would derive its monies from profits generated by the GSEs and from income derived from the FHA HECM program. |
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| I'm a Realtor®. What does this mean to my business? |
| Increasing the supply of affordable and entry-level housing will allow people to gain a foothold into homeownership enabling more families of modest means to become homeowners. |
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| NAR Policy: |
| The NATIONAL ASSOCIATION OF REALTORS® is unwavering in its commitment to assure that every American has the opportunity to attain a decent, safe and affordable home. This commitment must be addressed at the highest level of national priorities and must include the complete spectrum of the housing ladder -- from the homeless to the first-time homebuyer. |
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| Legislative/Regulatory Status/Outlook: |
In October, the House passed H.R. 2895 the "National Affordable Housing Trust Fund Act of 2007" introduced by Rep. Barney Frank (D-MA) and a bipartisan group of 16 members of Congress, including 8 Republicans and 8 Democrats by a vote of 264-148. The legislation would create a National Affordable Housing Trust Fund that would be used to develop, rehabilitate, and preserve affordable housing. It could also be used for homeownership assistance including downpayment and closing costs. The Fund would be administered by HUD, with 60% of monies going to cities and counties and the remaining 40% to states. Eligible grantees include nonprofit, for-profits, agencies, and faith-based organizations. 75% of all funds must be used for housing for extremely low income people (those making less than 30% of median). The remaining 25% can be used for families making up to 80% of the median. Recipients of the Funds must provide matching monies.
On December 19, 2007, Sen Kerry (D-MA) introduced S. 2523, the "National Affordable Housing Trust Fund Act of 2007." The bill is nearly identical to the House bill, but limits resources to those families making not more than 50% of area median income.
The legislation is controversial because of the source of the funding. Monies will be derived from profits from the GSEs (Freddie Mac and Fannie Mae), as well as excess revenue generated by the FHA Home Equity Conversion Mortgage program. There are some Members of Congress who strongly oppose using the revenue from these sources.
On July 12, REALTOR® JoAnne Poole testified in favor of this legislation before the House Financial Services Committee. Her testimony outlined the critical need for affordable housing, and the proven success of trust funds on the state and local level.
Other than introduction, there has not yet been any action in the Senate. |
 Link to Thomas
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