Harnessing Data and Insights: News from the Affordable Rental Housing Advisory Council

MBA NewsLink recently interviewed Victor Calanog of Manulife Investment Management and Daron Tubian of Barings, who lead the 2024 Affordable Rental Housing Advisory Council.

Managed by MBA Associate Director of Affordable Housing Initiatives Katelynn Harris Walker, the Affordable Rental Housing Advisory Council plays a crucial role in shaping strategies to enhance and preserve affordable multifamily housing nationwide. Through informed recommendations and insights, the council aims to pinpoint where efforts should focus to effectively address housing challenges.

Central to these efforts is the utilization of data and research. These tools not only illuminate the historical and persistent magnitude of the affordable housing issue but also forecast future needs. By harnessing both modern and traditional data sources, the council aims to identify precise areas where affordable housing is most urgently needed and where interventions can have the greatest impact. Moving beyond conventional measures, the council explores dispersion and association to ensure that tailored support reaches those most in need.

MBA NewsLink: Victor, can you help us understand the challenges of affordable housing?

Victor Calanog: We have very specific questions and targets when it comes to understanding the challenges of affordable housing: which constituents are we trying to serve, and why? What is the magnitude of the problem from a historical point of view, and will it likely persist in the future? How much has been done to help our target constituents, and how much more needs to be done?

These are questions with which we’ll need as objective a view as possible, being mindful of how policymakers have to balance many concerns and requests. Modern (typically more real-time) data on various housing options, for both renters and owners can be combined with traditional or official data sources on household and family counts and incomes to shed light on these questions.          

MBA NewsLink: Daron, why is it important for the council to utilize research to further the development of more housing units?

Daron Tubian: Combating the nation’s housing crisis requires multiple strategies. At the heart of this crisis is being able to understand and appreciate what factors can most help households that need affordable and middle-income (workforce) housing. 

Focusing on the research and analyzing the data collected will enable the Council to make recommendations through the MBA for programs and improvements that will ultimately help these households. It will also foster a better understanding for institutional investors interested in deploying capital in this space. 

For this to happen, we are making it a priority for the council to help define “middle-income housing” in a manner that is unvarying and consistent among industry players.

MBA Newslink: Victor, how can data analysis help identify areas where affordable housing is most needed and where interventions would have the greatest impact?

Victor Calanog: What we’ll typically see in most housing studies that are profiled by the mainstream media are measures of centrality: medians and averages, for example. “The rent burden for the median household is now X, given how incomes and rents have moved,” for example. The reality is that we have to deal with measures of dispersion so that support can be targeted and can make the most impact: typically measured as a percentage of area median income, should we be targeting households in the 60% AMI range? 80% or higher? How many of these households are there, why should they be supported, and how much will this cost?

Context from measures of association will also be required: given the range of incomes in particular area, what housing options are available and why is affordability more constrained, or less constrained? Is it different in Los Angeles versus San Francisco? Why? Going beyond measures of centrality to focus on other tools in data analysis will therefore be essential to answer these important questions.

MBA Newslink: Victor, how do you envision the Affordable Rental Housing Advisory Council contributing to the role of data and research in shaping innovative solutions for affordable housing?

Victor Calanog: We’re fortunate that members of our Affordable Rental Housing Advisory Council graciously volunteer their time and counsel when it comes to guiding questions (and battle-testing answers) for these important policy questions. They also bring a wealth of experience both from policy and industry to help steer our efforts efficiently.

The key point to mention here as well is the amazing support we get from the research teams at the Mortgage Bankers Association, led by Mike Fratantoni and Jamie Woodwell. They’ve done amazing work on related questions about the history of support for affordable housing and where it might be going, constantly keeping us apprised of how policy approaches are evolving.

This all comes together so that research is impactful – we’re not out to just publish papers that may or may not move the needle. We’ll want to make sure we address specific questions in an informed way, so that we can support positive, innovative change: this is a great forum to encourage that.

MBA NewsLink: Victor, how can the research and development efforts of the Affordable Rental Housing Advisory Council be integrated into commercial real estate finance practices and policy-making processes to address the challenges in this space?

Victor Calanog: It’s a great honor and privilege to be part of a team of senior executives in the industry and policy circles. Aside from substantive inputs to make sure we’re effective and efficient in our research efforts and policy recommendations, it also means we’re well poised to help spur activity from both the public and private sectors if and when positive change is implemented.

The challenges are indeed complex: investors and lenders in the private sector will always evaluate risk-adjusted returns on a relative and absolute basis, but there are natural constraints on such calculations if we’re considering affordability. Thinking through policy recommendations that make sense for all market players is critical, and I’m hopeful and confident that our Council’s diverse perspectives, deep experience, and commitment to salient issues will position our efforts well for adoption and impact.

Learn more about MBA’s Affordable Housing Initiative, CONVERGENCE, here. Stay up to date on all things affordable multifamily housing by joining the Affordable Rental Housing online community group.