Before and during the “Great Society” years of the late ’60′s, the United States government initiated several affordable housing initiatives that encouraged developers to build new, good-quality housing for many low- to moderate-income Americans. One of these programs, known to most people as the “expiring use” program, developers qualified for financing at attractive rates or terms in exchange for promising to keep rents low for an extended period of time. Like, 40 years. (The landlords need only pay off any outstanding loans in order to ‘buy out’ of the programs.)
Well, the 40 years are up and now many housing developments are aging out of the programs. As a result, the landlords have the legal right to raise rents on these units. Obviously, this will put many renters in dire straights. Faced with high-housing costs in many US cities, their options are few and none when it comes to moving into other, low-cost housing developments. (These are all privately owned, have nothing to do with the Section 8 or public housing projects.)
Federal and state governments have been getting involved to help stave off disaster.
In Massachusetts, Governor Deval Patrick has just signed legislation that will help thousands of renters.
From Banker & Tradesman:
Gov. Deval Patrick has signed a law to keep publicly-assisted rental properties affordable, and announced a $150 million loan fund to support and secure long-term affordable housing preservation efforts …
An estimated 90,000 units could be affected, with about 17,000 of those units at-risk of losing their affordability through expiring use over the next three years.
The landlords don’t miss out on anything. They can still, legally, cash out, but the government is hoping to ‘encourage’ them to take advantage of the new legislation, which gives Massachusetts, through the Department of Housing and Community Development, the right of first refusal on any property sale.
It’s not clear what would happen if and when the Commonwealth bought the properties. I think what’s being suggested is that Massachusetts wouldn’t buy it but would find new owners and help them with the purchase through financing new, low-interest loans.
Hurrah!
Related posts:
- California ruling on affordable housing set asides may mean trouble in Boston
- Northeastern professor suggests new “stimulus” plan
- Affordable housing units avail at Bryant Back Bay – “lottery” is right
- Depressing: Boston-area housing costs still high
- Greater Boston home prices seen as “affordable” to majority
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