AHFA Thresholds Newsletter: June 2015
Board of Directors Holds 35th Annual Meeting
The AHFA Board of Directors met in public session on Wednesday, June 24 and approved the election of officers for 2015-2016 as well as the recipients of 2015 HOME/Housing Credit funding awards.
2015 marks AHFA’s 35th year of operation. AHFA was created on May 28, 1980, by Act No. 80-585 of the Alabama Legislature and held its first board meeting on July 15, 1980.
The AHFA staff extends its sincerest appreciation to all board members, past and present, for their service and support.
AHFA Announces Multifamily Housing Development Allocations
On June 24, the staff and board of the Alabama Housing Finance Authority announced the 19 multifamily housing developments selected to receive allocations of 2015 Low-Income Housing Tax Credits (Housing Credits) or Housing Credits combined with HOME Investment Partnerships Program (HOME) funds. The HOME funds combined with Housing Credits awards are contingent upon approval of AHFA’s 2015 HOME Action Plan to be approved by HUD.
The approved developments will create 1,071 units of affordable housing across Alabama. A detailed recipient list with project locations and funding amounts is available for download at www.AHFA.com. Typically, construction on these approved developments begins within 6 months, with an expected completion date within 18-24 months.
AHFA Executive Director Robert Strickland said, “We are honored to administer these allocations that encourage developers to increase the supply of rental housing for economically disadvantaged families.”
Housing Credits provide a dollar-for-dollar reduction to an investor’s federal tax liability. In turn, the developer must reserve a percentage of the units for the area’s lower-income residents, based upon the area’s median income. HOME, a federally funded program, provides annual allocations that may be used by developers to construct new, affordable housing.
As Alabama’s administrator of these programs, AHFA directs an application cycle on a competitive basis. As part of the highly competitive funding process, the applications are evaluated in accordance with both the Housing Credit and HOME allocation plans. The applications are point-scored, which includes site visits and assessment of creditworthiness of the applicant/owners, principals, general contractor and management company. Each application is then underwritten for financial feasibility.
Housing Credits and HOME funds, as primary AHFA funding sources, are often utilized with other supplemental housing resources. This method, encouraging developers to leverage additional loan, grant, and philanthropic resources, is one of the measures AHFA takes to ensure programs help the most Alabamians possible.
MBAA Installs AHFA’s Mike King as Board President
AHFA Single-Family Administrator Mike King was recently named president of the Mortgage Bankers Association of Alabama (MBAA) for 2015-2016.
King oversees all aspects of AHFA’s single-family division, including operations, loan servicing and Hardest Hit Alabama. He has been employed with AHFA since 1988.
King’s installation was held in conjunction with the MBAA’s annual spring convention June 2-3 in Birmingham. As a sponsor of the event, AHFA distributed promotional items and program information from our tradeshow booth and hosted an educational session for attending lenders.
Established in 1929, MBAA is a trade association including more than 100 member companies from the state of Alabama and throughout the Southeast.
AHFA Participates in National Homeownership Month
Throughout June, AHFA shared “Making Homeowership Happen” posts each Tuesday and Thursday on our Facebook page. These posts featured homeownership resources, success stories about Alabamians who’ve used AHFA programs to help make their homeownership dream a reality, and information about other organizations that are also committed to providing safe, decent and affordable housing for tens of thousands of Alabamians each year.
AHFA is proud to actively engage in increasing homeownership opportunities for Alabama’s citizens. We believe that homeownership offers many benefits, including strengthening families, building communities, and promoting personal responsibility and well-being.
National Homeownership Month actually started as a week-long celebration of homeownership in 1995. In 2002, President George W. Bush proclaimed June National Homeownership Month, with a goal of helping more families achieve the American dream. In the proclamation, he encouraged all Americans to learn more about financial management and explore homeownership opportunities in their communities.
Did you miss one of our “Making Homeownership Happen” posts? Follow AHFA on Facebook to view them all.
Alabama Residential Sales in May up 10%; 88% of Local Markets Improve YTD from Last Year
Alabama Center for Real Estate (ACRE) Releases May Residential Sales Report
Sales: Alabama residential sales totaling 4,739 units in May reflected an increase of 10.1 percent growth from the same period a year earlier. Sales for the month were 19.1 percent above the May five-year sales average (’10-’14) of 3,978 units. Year-to-date sales through May were up 12.2 percent from 2014.
Forecast: May sales were 3.4 percent or 154 units above ACRE’s monthly forecast. ACRE’s year-to-date sales forecast through May projected 18,763 closed transactions while the actual sales were 19,358 units, a 3.1 percent cumulative variance.
Supply: The statewide housing inventory in May was 33,269 units, a decrease of 1.3 percent from May 2014 and 22.8 percent below the month of May peak in 2008 (43,113 units). There was 7.0 months of housing supply in May (6.0+/- months NSA considered equilibrium), which represents a favorable drop of 10.3 percent from May 2014 (7.8 months). May inventory did increase 1.2 percent from the the prior month. This direction is consistent with historical data that indicates May inventory on average (’10-’14) increases from the month of April by 0.9 percent.
Demand: May residential sales increased 9.6 percent from the prior month. This direction is consistent with historical statewide data indicating that May sales on average (’10-’14) increase from the month of April by 10.2 percent. This trend is consistent with sentiment expressed by industry professionals in the Center’s 2015 Q2 Alabama Real Estate Confidence Index (ARECI). The average Days on Market (DOM) until a listing sold was 155 days, 6.2 percent faster than last year. Nationally, April sales were 6.1 percent above the same period last year (SA).
In May across Alabama, 72 percent of local markets report positive sales growth compared to last May. Year-to-date, 88 percent of local markets report increased sales from last year. Sales during the month were 42.8 percent above the month of May bottom experienced in 2009.
National Industry Perspective: “Things are looking up for housing,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Those saying it is a good time to sell a house hit a survey high of 49 percent. Also, the percentage of consumers telling us their household income is significantly higher than 12 months ago grew six percentage points to 28 percent over the past two months. We have found that these two indicators – good time to sell and income growth – are key drivers for the performance of the housing market and play an important role in our soon to be released Home Purchase Sentiment Index™ (HPSI). The increase in these indicators suggests our forecast of moderate improvement in the housing market in 2015 is on course and mirrors the near-term performance of other leading market data, including mortgage applications and pending home sales.”
For ACRE’s full report, go here.
Affordable Housing News Summer 2015 Issue Features AHFA
AHFA is featured as a leading provider of affordable financing products in the Summer 2015 issue of Affordable Housing News magazine. Check us out on pages 28-29.
Section 8 Scams Are Cheating Housing Seekers
Online rental fraud is becoming a widespread problem. In a particularly malicious scam, con artists have created fake websites that prey on those looking for affordable housing. The sites appear to offer a way to sign up for a voucher wait list, but they really collect fees and personal information from victims.
The Federal Trade Commission (FTC) and the Department of Housing and Urban Development (HUD) are working together to alert consumers of scams aimed at people who are seeking Section 8 housing.
While Section 8 subsidies in Alabama are administered by the local public housing authorities and not AHFA, such scams could impact residents, managers, owners and developers of AHFA-financed affordable housing developments.
Click the link below to view the FTC’s scam alert.
Harvard’s Joint Center for Housing Studies Releases Annual Housing Report
Harvard’s Joint Center for Housing Studies (JCHS) has released its annual report entitled The State of the Nation’s Housing 2015. This year’s report highlights low homeownership rates and continuing rental housing cost burdens as areas of concern. The Joint Center’s report concludes that the housing market, buoyed by the persistent strength and demand of the rental market and continued employment growth, can regain some of the recovery momentum that was lost during 2014.
The report also comments on the value of the Housing Credits and tax-exempt bonds, highlights the gap between housing needs and federal appropriations, and demonstrates the importance of preservation of at-risk affordable housing.
Meet the Alabama Affordable Housing Association
The Alabama Affordable Housing Association (AAHA), formerly known as the Alabama Council of Affordable and Rural Housing (ALCARH), not only has a new name, but also a new logo and website. AAHA also recently distributed its first newsletter, full of current information about Alabama’s affordable housing sector.
View the newsletter here: www.theaaha.org.
Tell Us Your News!
We want to hear your stories of success. You – our lenders, developers, managers, and real estate professionals – are our front line of communications with our customers. Help us put a human face on the work we do AND promote your business in our different communications including this newsletter as well as our website, Facebook page and Annual Reports.
Ready to share? Email our communications staff.
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