CREF Policy Update: MBA, Trades Send Letter to President Biden Opposing Rent Control Proposal
MBA, Trades Send Letter to President Biden Opposing Rent Control Proposal
MBA last Monday joined several other trade associations in a coalition letter opposing President Joe Biden’s campaign proposal announced last week to cap rent increases and repurpose public land to construct more affordable housing. The coalition urged the White House to reject rent control measures, highlighting that it is a failed policy that ultimately leads to increased rents and less housing supply.
• The White House fact sheet released last week calls on Congress to pass legislation that would force corporate landlords to choose between capping rent increases on existing units at 5% or losing valuable federal depreciation tax credits.
Go deeper: MBA’s President and CEO Bob Broeksmit, CMB, responded swiftly in a press statement after last week’s announcement, stating that “increasing the supply of affordable rental housing nationwide – not politically-motivated and self-defeating rent control proposals floated during election campaigns – is the best way to alleviate affordability constraints for renters.”
• MBA and the other housing trade groups that make up the Housing Solutions Coalition also sent a press statement – read it here.
Why it matters: The Biden administration has been very focused on housing affordability and tenant protections. MBA and other industry stakeholders have met with the White House numerous times on these topics, stressing the importance of increasing affordable housing supply and avoiding unnecessary regulations such as rent control
What’s next: President Biden’s proposal requires legislation to be passed by Congress, which may prove to be difficult regardless of the outcome of the election. MBA will continue to engage with Congress, the administration, and other industry stakeholders to advocate for sound and proven solutions that will help boost the supply of affordable housing.
For more information, please contact Stephanie Milner at (202) 557-2747.
MBA-Supported Housing Solutions Coalition Pushes Affordable Supply Initiatives Before Congress
Last Wednesday, the House Financial Services Committee’s Subcommittee on Housing and Insurance held a hearing entitled, “Housing Solutions: Cutting Through Government Red Tape,” which addressed the impact of government regulations on housing affordability.
• The hearing highlighted the significant challenges posed by various regulatory requirements at the federal, state, and local levels. Witnesses included officers of the National Association of Home Builders (NAHB) and the National Multifamily Housing Council (NMHC).
Why it matters: Ahead of the hearing, the Housing Solutions Coalition released a statement both condemning President Joe Biden’s call for rent control, while encouraging policymakers to increase the supply of affordable housing through actionable recommendations.
• The coalition’s recommendations included: reducing permitting red tape that often leads to construction delays; providing inclusive zoning reform; expanding the Low-Income Housing Tax Credit (LIHTC); providing incentives for office conversions; and creating an efficient lending process for multifamily via the Federal Housing Administration (FHA).
• During the hearing, numerous policymakers from both sides of the aisle also disagreed with rent control as a solution. Additionally, many lawmakers also acknowledged the increasing cost of property insurance on multifamily properties, an issue priority for MBA members.
What’s next: This year MBA successfully advocated for the strong bipartisan House passage of H.R. 7024, the Tax Relief for American Families and Workers Act, which included a separate title with needed refinements to the LITHC program. MBA and its coalition partners will continue to educate lawmakers on policies designed to increase the supply of affordable housing.
For more information, please contact Rachel Kelley at (202) 557-2816 or Madisyn Rhone at (202) 557-2741.
Senate Appropriators Advance Fiscal Year (FY) 2025 “T-HUD” Funding Bill
Last week, the full Senate Committee on Appropriations completed its markup of its preferred version of the Transportation and Housing and Urban Development (“T-HUD”) funding measure for FY25.
• The bill was approved by a near-unanimous vote of 28-1 vote by the panel. A full summary of the bill is available here. The final bill text and its accompanying report is available here.
Why it matters: In contrast to the House version of its FY25 T-HUD funding bill, the Senate bill’s text (just released today) honors the Administration’s (and MBA-supported) request for FHA administrative expenses ($155 million) and multifamily commitment authority ($35 billion). Also, per MBA’s recommendation, the Senate bill fully funds HUD’s request of $67 million to cover its Ginnie Mae-related administrative expenses (including personnel and consultants) – a $13 million increase over FY24 levels.
• Go deeper: The committee report that accompanies the bill also contains MBA-suggested commentary on the impact of state property tax impacts on housing consumers, HUD’s affordable housing finance mechanisms – including “minimizing the need for duplicative inspections” – and the alignment of various affordable housing programs, including the level of coordination between the Transportation Department and HUD on transit-related development.
What’s next: MBA will continue to analyze the differences between the House and Senate FY25 T-HUD bills against our requested priorities – and push for the most favorable resolution of those differences in a final “omnibus” or “minibus” bill – most likely during a “lame-duck” legislative session after the November elections.
For more information, please contact Ethan Saxon at (202) 557-2913 or George Rogers at (202) 557-2797.
House Financial Services Committee Explores AI Applications in Housing
Last Wednesday, the House Financial Services Committee held a hearing entitled, “AI Innovation Explored: Insights into AI Applications in Financial Services and Housing.”
• The hearing follows the Committee’s recent publication of its bipartisan staff report on artificial intelligence (AI). Republican lawmakers argued that the existing laws and regulations governing the financial services sector are already sufficient to oversee new AI technologies, particularly due to the third-party vendor requirements for financial institutions.
• See a full summary of the hearing here, and watch a livestream of the full hearing here.
Why it matters: Many Democrats raised concerns about the potential for discrimination perpetuated by AI tools, especially discrimination in the housing and rental sectors due to third party tenant screening, automated valuation models (AVM), and automated mortgage underwriting. A few Democrats also called for legislative action to address algorithmic discrimination.
Go deeper: There was also extensive discussion of industry standards to maintain the safety and fairness of AI models, such as utilizing quality datasets, maintaining transparency, mandating human involvement, and testing models. A few lawmakers and witnesses also explored the possibility of congressional action to implement a single uniform digital identification standard to address the fraud risks posed by AI, such as “deep fakes” and synthetic identities.
• Some members agreed on the need to pass bipartisan legislation to study and combat “deep fakes.”
What’s next: MBA will continue to work with lawmakers as they develop legislation and look to our industry for information on the use of this increasingly important technology by our sector.
For more information, please contact Rachel Kelley at (202) 557-2816 or Madisyn Rhone at (202) 557-2741.
House Committee on Administration Holds Hearing on Supreme Court Chevron Decision
Last Tuesday, the House Committee on Administration held a hearing to examine the future of congressional policymaking following the Supreme Court’s recent ruling in Loper Bright Enterprises v. Raimondo, which overturned a previous Court decision compelling courts to defer to federal agencies for their reasonable interpretations of ambiguous statutory text — commonly referred to as “Chevron deference.”
• Read a hearing summary here or watch a livestream of it here.
Why it matters: Given that the Loper Bright ruling will have sweeping implications for future rulemaking processes, members of the Committee questioned witnesses on possible solutions to expand Congress’ regulatory authority and the level of precision needed to craft meaningful legislation in the post-Chevron era.
• Democrats and Republicans strongly disagreed about the impact of the Supreme Court’s ruling in this case. While GOP lawmakers on the panel felt the decision will re-establish Congress’s primary role in the statutory construction of new law – and subsequent regulation, Democrats countered that it will instead unintentionally decrease the power of the Legislative Branch by empowering courts at the expense of Congress.
• Witnesses fielded questions from lawmakers on both sides of the aisle as to whether Congress should take action in the aftermath of the decision by: (1) establishing a dedicated regulatory authority function within Congress that would involve hiring additional staff with the necessary subject-matter expertise; and/or (2) enhancing bill drafting techniques to ensure clarity in statutory texts.
What’s next: MBA will continue to follow the ramifications resulting from this landmark ruling – both on Capitol Hill and beyond.
For more information, please contact Rachel Kelley at (202) 557-2816, Madisyn Rhone at (202) 557-2741 or Justin Wiseman at (202) 557-2854.
Delinquency Rates for Commercial Property Loans Declined Slightly in Second Quarter of 2024
Delinquency rates for mortgages backed by commercial properties declined slightly during the second quarter of 2024. This is according to MBA’s latest commercial real estate finance (CREF) Loan Performance Survey, released last Thursday.
MBA’s Head of Commercial Real Estate Research, Jamie Woodwell said, “The delinquency rate for most property types declined last quarter, with the exception of loans backed by office properties, which experienced an increase,” said Jamie Woodwell, MBA’s Head of Commercial Real Estate Research. “Even so, the pace of increase in the delinquency rate for office property loans appears to have slowed in recent quarters.”
Go deeper: “Commercial properties are working through changes in interest rates, property values, and the fundamentals of some properties,” Woodwell noted. “Each property and loan faces a unique mix of conditions depending on that property’s type and subtype, market and submarket, owner, vintage, deal terms and more. As more loans mature throughout the year, more properties will be adjusting to these new conditions.”
For more information, please contact Jamie Woodwell at (202) 557-2936.
[VIDEO]: mPower Moments: On the Importance of Putting Yourself First with MBA’s Jamika Adams
mPower Founder Marcia M. Davies sits down with Jamika Adams, MBA’s Board Coordinator and Senior Executive Assistant, for an inspiring conversation on her career journey at MBA and why she decided to return to her current role following a move to another department at MBA.
Go deeper: Adams also discusses the importance of creating opportunities that best fit for your career and not worrying about how others may react to your choices. She also emphasizes the value of work-life balance and clearly communicating your needs so that you can continue to be successful while also managing personal life and obligations.
To watch more mPower Moments, click here.
For more information, please contact Marcia Davies at (202) 557-2707.
Participate in the Mortgage Action Alliance’s “Advocacy in August” Campaign
MBA’s “Advocacy in August” campaign starts next week! Join your fellow industry advocates and Mortgage Action Alliance (MAA) members and get involved during the congressional August recess by taking action on current real estate finance policy priorities and legislative issues – and by arranging to meet with elected officials back in their states or districts.
Why it matters: The Advocacy in August campaign is an important political engagement strategy for our industry to help advance key policy and advocacy priorities. Your participation through allows MBA to build and strengthen individual relationships with lawmakers during the traditional congressional August recess.
What’s next: MBA’s Legislative and Political Affairs team will once again coordinate in-person and virtual meetings in elected officials’ home states or districts. Get involved!
For more information, please contact Jamey Lynch at 202-557-2818.
REGISTER: MBA’s Commercial/Multifamily Insurance Conclave 2024
MBA is hosting a Commercial/Multifamily Insurance Conclave 2024 on Oct. 6-8 in Kansas City, Mo.
• This premier event brings together Insurance and Risk professionals from all capital sources to discuss insurance market trends, best practices for addressing and implementing changes in the future, and much more.
Why it matters: Rising property insurance costs and diminishing policy options are increasingly becoming a problem in several states, and insurance requirements are becoming more strict.
What’s next: Register today to secure your seat.
For more information, please contact Jacky Salazar at (202) 557-2746.
Upcoming MBA Education Webinars on Critical Industry Issues
MBA Education continues to deliver timely commercial/multifamily and single-family programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – which are complimentary to MBA members:
• Analyzing the Commercial/Multifamily Borrower’s Balance Sheet and REO Schedule – Aug. 27
• Affordable Housing Insights: Understanding Consumers, Buyers, and Uses of Accessory Dwelling Units – Aug. 29
• Finding Opportunities with Distressed CRE in 2024 – Sept. 10
• Overview of Commercial Insurance Compliance – Oct. 3
MBA members can register for any of the above events and view recent webinar recordings by clicking here.
For any questions, please contact David Upbin at (202) 557-2931.
