Dr. Ben Carson
Secretary of Housing and Urban Development
White House Roundtable on Housing Affordability
Friday, November 16, 2018
Thank you, Andrew.
I'm delighted to be with all of you this morning at the Eisenhower Executive Office Building.
I see many familiar faces, including Mayor Bob LeGare (Aurora, CO).
Mayor LeGare, the Village at Westerly Creek, which includes affordable senior housing, shows us what can be accomplished when federal, state, and local officials join forces with the private sector to address affordable housing challenges.
Shared Interests & Shared Challenges
Everyone here today knows the importance of housing-housing of all kinds and for people at every income level, in every stage of life, and from every walk of life.
There is a lot of activity in the housing industry right now. There is enthusiasm for the Opportunity Zones created by the Tax Cuts and Jobs Act. And, alternatively, there is concern with rising interest rates, which are pushing mortgage rates up.
Rising rates are putting a spotlight on an issue that impacts all of us in this room: affordable housing and our country's insufficient supply of it.
With rents rising faster than incomes, despite low unemployment and strong growth from President Trump's economic policies, we need to bring everybody to the table to produce more affordable housing and ease the pressure that's forcing too many of our neighbors into our shelters and onto our streets.
The issue of supply and demand is not just a federal problem-it's everybody's problem. We need to collaborate and share ideas to apply evidence-based best practices. That's why you've been invited here today. Solving our nation's affordable housing challenges will take a team effort.
HUD is doing its part to address the affordable housing shortage.
One key part of this is ensuring that the affordable housing overseen by HUD is safe and accessible.
In September, we broke ground on the 100,000th public housing unit preserved through our Rental Assistance Demonstration program, also known as RAD. This public-private partnership, which many of you are familiar with, has generated close to $6 billion in construction investment and over 108,000 jobs.
If not for RAD, HUD estimates it would have taken 46 years to accumulate enough public capital to achieve these same goals. RAD continues to be a tremendous preservation tool for our existing housing stock.
We're also working on multiple fronts to increase our country's housing supply, including reducing regulations on manufactured housing.
And, to improve how our programs help the tenants they serve, we are expanding our Moving To Work program so that local PHAs have more tools to tailor their programs to the needs of the local population, including flexibility to ensure that housing assistance programs do not discourage residents from working or taking higher paying jobs.
While unemployment is at historic lows and the housing market has ticked up, the demand for affordable housing is still staggering.
Only one in four households eligible for housing assistance actually receive it, and many of our public housing authorities have multi-year waiting lists. Even those that do receive assistance often have a difficult time securing housing.
To help meet this demand, we need more landlords to participate in our Housing Choice Vouchers program. So, we've launched a Landlord Task Force, which just completed listening forums in seven cities across the country to examine how we can all work together-local governments, public housing authorities, landlords, and HUD-to improve our voucher program and increase opportunities for economic mobility and quality housing for the 2.2 million families our program serves today.
And, we're working to bring fairness to fair housing by increasing the supply of affordable multifamily housing through several initiatives.
Reforming AFFH to Meet Demand
As many of you are aware, earlier this year, we put out an advance notice of proposed rulemaking and announced our intention to amend the Affirmatively Furthering Fair Housing, or AFFH, Rule.
The current highly prescriptive regulations give participants inadequate autonomy in developing fair housing goals and are ineffective in addressing the lack of adequate housing supply, which has particular adverse impact on protected classes under the Fair Housing Act. These tools simply proved to be unworkable, which is why we at HUD felt compelled to take another look at AFFH. Furthermore, while many of AFFH's objectives are quite commendable, I am sensitive to criticisms that AFFH's approach was too heavy-handed and Washington-centric. What we want to do in pursuing new rulemaking-and why we've asked for public comment from all parties concerned-is to lessen regulatory burdens and help empower local officials to meet their obligations as they judge best.
While the current rule centers on analytics to discover discrimination, I hope local leaders will take a closer look at the archaic local and state regulatory barriers-such as outdated zoning and land use restrictions-that are preventing the construction of new mixed-income multifamily developments, whether in poor or wealthier neighborhoods.
Basically, we need to encourage the development of mixed-income multifamily dwellings all over the place. And how can we do this? By working together with local officials and leaders, like all of you, to examine your existing rules and regulations and see if they're inadvertently driving up the cost of housing and multifamily development.
As noted, the National Association of Home Builders estimates that more than 25% of the cost of a home is the direct result of federal, state, and local regulations. Moreover, a large majority of big city land parcels are eligible only for single-family homes, and not larger multifamily buildings-which could house more people, and in the process, moderate rent prices.
And a study by the CATO Institute reveals that federal housing vouchers go to the most-restrictively zoned states at more than twice the rate that they go to the least-restrictively zoned states, and that the most-restrictively zoned states receive nearly two times more federal dollars per capita than the least-restrictively zoned states, because of the high price of land use.
Overall, it's about time we take a long, serious look at all the regulations that have held back America's affordable housing supply-especially multifamily housing-from keeping pace with demand. HUD is doing its part on the federal side by conducting an ongoing review of the agency's federal regulatory burdens. But we want to partner with you to identify, share, and incentivize best practices that will lead to more housing construction in our communities and more housing opportunities for the families that live there. After all, it strengthens our communities if the teachers, firefighters, police officers, and nurses that serve them can afford to call them home.
I want to thank all of you again for coming here today. I'm optimistic that, by working together, we can meet the affordable housing challenges facing our nation and ensure that our cities and communities are accessible to all the families we serve.
I look forward to our question and answer discussion. Thank you.
And, now, I'll turn it back over to Mr. Bremberg.