Subcommittee Examines U.S. and U.K. Models for Affordable Housing

Washington, D.C. – (RealEstateRama) — The Financial Services Subcommittee on Housing and Insurance held a hearing on Thursday entitled “The Future of Housing in America: A Comparison of the United Kingdom and United States Models for Affordable Housing.” This hearing is part of a series undertaken by the subcommittee to assess affordable and rental housing programs 50 years after the creation of the U.S. Department of Housing and Urban Development.

“Today, we will look outward, beyond our borders, to examine innovative methods and programs that aim to help more people and attract greater private and nonprofit sector participation… It’s my hope that today’s assessment of an alternative housing model will serve as a means of self-reflection on how our own nation can approach affordable housing and, more importantly, how the United States can do it better,” said Subcommittee Chairman Luetkemeyer (R-MO) in his opening statement.

Key Takeaways from the Hearing:

  • Since its creation 50 years ago, HUD has overseen the proliferation of publicly-funded programs to provide affordable housing and eliminate poverty. As recently as three years ago, the Government Accountability Office reported to Congress that 20 differentfederalgovernmententitiesadminister 160programs,taxexpenditures,and other tools that support homeownership and rental housing.
  • In the 1980s, the United Kingdom was facing similar issues to what we find America in today. Generational poverty led to recurring dependence on the same housing projects and outdated systems. Under the leadership of Prime Minister Margaret Thatcher, innovation and ownership was invited into the public housing sector by generating significant private capital investments and incorporating private-sector management practices.
  • 79 years after the creation of public housing in the United States, new models are needed to generate private capital investments, private-sector management practices and market discipline, combined with a public mission to serve low income families in need of affordable housing to become more economically self-sufficient.

Topline Quotes from Witnesses:

“The lessons of the growth of British housing associations due to Large Scale Voluntary Transfer as well as portfolio flexibility and financing should be used to expand the role of social enterprises in the U.S. so that innovative, effective solutions to housing challenges facing society’s most vulnerable people and communities are scaled up.” – Thomas Bledsoe, President and Chief Executive Officer, Housing Partnership Network

“The current public housing system, including HUD itself, rationalizes structure and process over social outcomes, a particularly poor set of choices in the face of the budget numbers that are provided for our programs.” – Gregory P. Russ, Executive Director, Cambridge Housing Authority

“Since 1988, housing associations have been very successful in raising private finance to support social aims. By 2012, housing associations secured more in private financing to cover operations … than government grant …for the first time, marking a dramatic shift in the support for social housing.” – Harris Beider, Professor in Community Cohesion, Coventry University, England, UK

“…I believe that the United States’ traditional public housing program is no longer viable in its current form to continue serving the needs of low-income Americans.” – Richard C. Gentry, President and Chief Executive Officer, San Diego Housing Commission

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Financial Services Committee

The Committee oversees all components of the nation's housing and financial services sectors including banking, insurance, real estate, public and assisted housing, and securities. The Committee continually reviews the laws and programs relating to the U.S. Department of Housing and Urban Development, the Federal Reserve Bank, the Federal Deposit Insurance Corporation, Fannie Mae and Freddie Mac, and international development and finance agencies such as the World Bank and the International Monetary Fund.

The Committee also ensures enforcement of housing and consumer protection laws such as the U.S. Housing Act, the Truth In Lending Act, the Housing and Community Development Act, the Fair Credit Reporting Act, the Real Estate Settlement Procedures Act, the Community Reinvestment Act, and financial privacy laws.

Contact:

House Financial Services Committee
Democratic Staff
2129 Rayburn House Office Building,
Washington, DC 20515
Phone: (202) 225-4247
Fax: (202) 225-6952 

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