A bill that would provide up to $1 billion a year to build more than 1 million affordable rental units during the next decade and provide down-payment and closing-cost assistance for first-time home buyers has backing from sponsors on both sides of the aisle.

The bill, which would create an Affordable Housing Trust Fund, was introduced Thursday and is scheduled for a July 12 hearing before the House Financial Services Committee. The bill’s sponsors are committee Chairman Rep. Barney Frank, D-Mass., Rep. Maxine Waters, D-Calif., Rep. John McHugh, R-N.Y., and Jim Ramstad, R-Minn.

The Affordable Housing Trust Fund would be used to build, rehabilitate and preserve 1.5 million units of affordable rental housing, and to provide down-payment and closing-cost assistance for first-time home buyers.

The bill would allocate $800 million to $1 billion a year to states and local communities, part of which could come from Fannie Mae and Freddie Mac. The House last month passed legislation that would require Fannie and Freddie to pay about $500 million a year into an affordable-housing fund.

The new bill’s supporters said other funding would come out of anticipated savings generated by planned changes to the Federal Housing Administration’s operations, as spelled out in H.R. 1852, the Expanding Americans Home Ownership Act.

According to the National Low Income Housing Coalition, which supports the latest bill, there are 9 million extremely low-income families who rent, and only 6.2 million rental units that are affordable to them — a shortage of 2.8 million units.

The bill would require that all expenditures benefit low-income families, and that 75 percent of spending be targeted at extremely low-income families — those earning les than 30 percent of median income.

The Affordable Housing Trust Fund would earmark 60 percent of available money for larger cities and counties and the rest to states and Indian Tribes. The Department of Housing and Urban Development would develop a formula for allocations based on population, housing affordability, percentage of very and extremely low-income families, cost of construction and rehabilitation, and the extent of substandard and aging housing.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription