Industry Leaders Speak Out on Candidates, Election

AFFORDABLE HOUSING FINANCE • October 2008

BY AFFORDABLE HOUSING FINANCE STAFF

AFFORDABLE HOUSING FINANCE asked industry leaders their thoughts on presidential candidates Sen. Barack Obama and Sen. John McCain as well as what the election means to the affordable housing industry. Here are their responses.

Q: As we go into the conventions, what pros and cons do you feel each of the candidates have regarding housing?

Jim Arbury, senior vice president of government affairs, National Multi Housing Council: Both candidates are obviously "for" housing. It is a matter of degree and the extent to which they include rental housing in the mix. Obama's policy announcements have focused more on homeownership, but some of his key advisers understand the importance of rental housing given the fact that nearly one-third of Americans live in rental housing. McCain's outright views on housing are less well-known.

Kris Cook, executive director, National Affordable Housing Management Association: I think the challenge for both candidates is managing information on the many pressing issues facing our country, and communicating the priority issues they would address first during their administration. Unfortunately, if you visit the official Web site of either candidate, it's difficult to find meaningful and precise information on affordable multifamily rental housing.

Conrad Egan, president and CEO, National Housing Conference: Both candidates need to increase their support for the preservation and production of affordable and workforce homes available to households of all incomes and needs.

Michael Stoops, acting executive director, National Coalition for the Homeless: I want both candidates and parties to acknowledge that we have a severe housing crisis in this country. While homeless people are the ones most hurt by this, the housing crisis affects all economic classes -working class/middle class.

Q: What does the 2008 election mean for housing?

Michael Bodaken, president, National Housing Trust: We are at a crossroads in affordable housing practice and policy. The combination of the foreclosure crisis in the single-family market, the decline in home equity, the potential bailout of Fannie and Freddie, and the related decline in low-income housing tax credit pricing makes for a particularly challenging housing environment. On the other hand, Congress has just adopted legislation that could, if implemented swiftly, provide some much-needed relief. The next president and Congress will inevitably be faced with questions concerning the appropriate mix and speed of government intervention to help mitigate the harmful effects of all of this on the economy.

David Smith, CEO, Recap Advisors: For the first time in two decades, housing is a national political issue-unfortunately, it is a negative issue (how do we keep people in their homes?) rather than a positive one (how do we create more affordable and workforce housing?). For housing advocates, we need to convert the political interest into consensus proposals to expand supply, particularly in workforce housing, the only income band that does not receive some form of programmatic or tax assistance.

Q: What makes the 2008 election different for affordable housing than prior elections?

Arbury: The bursting of the singlefamily housing bubble has led to a serious credit crisis and a sizeable overhang of unsold single-family houses. Housing, in many ways, is a much higher priority than it ever has been before, but whoever is elected president in November will face significant obstacles in terms of trying to establish any new affordable housing programs. The downturn in the economy will also place pressure on the need to possibly expand the Sec. 8 voucher program for renters.

Egan: The challenge and opportunity to strengthen and update the federal agencies; to connect federal housing policies to federal transportation, health, education, and economic development policies; and to reengineer and reinvigorate the federal relationships with state and local initiatives and leadership.

David Gasson, vice president, Boston Capital:
The supply of affordable housing is as dismal now as ever due to the struggles of the economy and collapse of the single- family housing market. The combination of questionable lending practices and the fear that potentially tens of thousands of one-time homeowners are now in need of affordable rental housing make it incumbent that candidates for public office support the existence and funding of housing programs at every level.

Denise Muha, executive director, National Leased Housing Association: The difference is that housing is on the minds of the American people because of the foreclosure issues and the worsening economy. Will that translate into a sensible and cohesive federal approach to affordable housing (outside of homeownership)? Maybe.

Q: What do you want to hear from the candidates prior to the election? Arbury:

I would like to hear the candidates acknowledge that renters are not second- class citizens and that a good supply of decent affordable rental housing is not only good for our economy, but also gives workers flexibility to move to another area if they have a better job opportunity. I would like to hear them explicitly acknowledge that there are downsides to homeownership, not the least of which is the potential for being stuck with an asset that you cannot sell.

Bodaken: A bit more about a more balanced neighborhood revitalization and housing policy and how a mix of good affordable homeownership and rental housing would help repair neighborhoods, help households realize their potential, and fix the economy. Second, a recognition that residential buildings account for over 35 percent of our total electric consumption and 20.5 percent of our greenhouse gas emissions. Hence, any thoughtful climate change or transportation policies must include how we build and repair residential housing.

Cook: I'd love to hear some discussion about the need for a balanced housing policy -the country's need for both quality and affordable single-family housing as well as quality affordable multifamily rental housing.

Smith: Awareness that housing means more than homeownership. Recognition of the importance of municipal governance and reducing barriers to creating new affordable housing. Constructive and substantive plans to create more workforce housing. Commitment to fund the rejuvenation of public housing, which is on the verge of complete systemic breakdown.

Stoops: A commitment to tackling the root causes of poverty in this country is what I want to hear.

Q: Heading into the election, what advice would you give other voters in picking the right candidate for housing?

Arbury: I think voters are largely focused on the overall economy, the price of gasoline, and the war in Iraq, but I would like to see them call on the candidates to advance a more balanced housing policy that better reflects our current housing needs. Record-setting gasoline prices, changing demographics, and shifts in lifestyle preferences are causing many households to redefine the American Dream as an apartment in a walkable neighborhood with stores, entertainment, and jobs nearby. Experts predict that as a result of these changes the United States will have a surplus of more than 22 million large-lot single-family houses by 2025.

Cook: I think we all have to be really vigilant about reading and understanding the candidates' positions, so we're truly informed when we go to vote. Regrettably, sometimes the 60-second commercial sound bites serve to reinforce preconceived opinions, and the real positions and debate don't surface.

Q: Are you watching any other races or measures on the ballots for this upcoming election?

Arbury: We are watching dozens of elections for their potential impact on priority issues for the apartment industry. Our number one local issue has always been local rent control laws. We are also watching efforts at the state level to enact mandatory access to apartments for telecommunications service. And, of course, local initiatives that seek to make apartment providers immigration police by fining them if they rent to undocumented immigrants are a priority.

Bodaken: Close Senate races.

Gasson: Our industry has worked for many years to educate members of Congress and their staffs on housing issues, gaining advocates for our programs. These advocates have worked diligently to sustain and strengthen the programs that produce a majority of the affordable housing in the United States. When elections come around we are always wary of the prospects of our advocates. Thus is the case this election with a few very good friends of housing such as Sen. Gordon Smith of Oregon and Sen. Mary Landrieu of Louisiana. Both have been strong voices for affordable housing issues with Sen. Smith being an original cosponsor of the Affordable Housing Investment Act of 2008 in the Senate. Losses by either or both of these senators would be a loss for our industry.

Q: Who do you feel is the best candidate for housing-Sen. McCain or Sen. Obama, and why?

Arbury: Each candidate and each party have pros and cons when it comes to the issue of housing. We stand ready to work with the next president and his administration.

Gasson: While neither candidate has served on a committee with oversight of housing programs, their comments and actions do speak volumes. Sen. Obama has a working group within his campaign focused on housing/affordable housing issues as well as another group working on economic development. Affordable housing as an issue is also included on his campaign Web site, where he endorsed the Affordable Housing Trust Fund among other issues. Sen. McCain has no such mention on his campaign Web site. Also of concern are comments by his economic advisers indicating the senator, if elected, would consider eliminating the LIHTC program as a way to help pay for a corporate tax cut (Wall Street Journal, March 18, 2008).

Stoops: Whichever candidate talks openly and candidly about the affordable housing crisis in this country will surely be elected president. We then need to hold the candidate accountable.
When you think about it, the White House is, in reality, subsidized housing. The president is paid over $400,000 a year; pays no rent; gets free food, etc. Perhaps the new president should start paying rent to live in the White House.