Comment Detail

Comment

Director Thompson,

The increase in COAH requirements for builders has been a double edged sword. While the need for affordable housing is clear and has been ignored for far too long in many municipalities, it has hampered the ability for many developers to build at an increased pace. The affordable housing units are a negative hit to direct margins, making previously buildable projects undesirable or in some cases unbuildable due profitability standards. This further exacerbates the underproduction and supply issue in housing and, therefore, contributes to higher prices in housing market. Ultimately, this will effect the average American the most, as wealthy individuals and families will be able to afford housing at elevated prices and the poor will have increased access to housing if they qualify under the COAH guidelines.

Without significant and meaningful incentives to build at an increased pace, I believe the issue will get worse before it improves.

Thank you for the opportunity to respond to your Request for Input (RFI) on how the Federal Housing Finance Agency (FHFA), in its oversight of Fannie Mae and Freddie Mac, can best provide affordable housing opportunities for renters. Approximately 40% of the National Association of REALTORS®'s (NAR) 1.5 million members own at least one rental housing unit, playing a vital role in providing safe, quality, and affordable housing in neighborhoods nationwide.

As the FHFA examines ways to improve access to affordable housing, it is critical to acknowledge the most significant driver of housing unaffordability is the limited supply of available housing. According to NAR data, the United States has an underproduction gap of over 5.5 million units – a key underlying reason housing costs have increased. On top of this, inflation has increased the prices of goods and services for all Americans. As housing providers strive to provide affordable housing opportunities in their communities, they also contend with rising mortgage rates and increased costs for supplies, services, and maintenance. When inflation is high, the prices of materials increase. That means it becomes exceedingly more expensive for construction teams to build new homes or renovate existing ones. Ultimately, these high costs spill into the housing market and lift home prices for new builds and existing housing.

As REALTORS®, we are committed to upholding the very specific provisions of our contracts with residents, and we often go above and beyond what is required to ensure residents have safe, quality, and affordable places to live. Rental housing is a deeply complex issue that is unique to every community. Creating additional layers of policies to a space that is already heavily regulated by state and local governments will have severe unintended consequences for renters as housing providers are leaving the market in communities where affordable housing is sorely needed.

Affordable housing is pivotal to creating paths to upward mobility for people across the country. I appreciate your commitment to ensuring we achieve this goal without impeding the creation of much-needed housing supply. Henry Song