“Mortgage rates have increased 150% since their all-time low in January 2021, rents have risen by more than 15% nationally since 2021, and homelessness increased by 12% over last year,” House Committee on Financial Services Chair Patrick McHenry (R-NC) said at the opening of a January 11 Department of Housing and Urban Development (HUD) oversight hearing. HUD Secretary Marcia Fudge was the sole witness, with the main themes being the shortage of affordable housing in the United States and what steps HUD is taking to address the shortage.

View the webcast of the hearing to see Fudge’s testimony. Here are some highlights:

• McHenry asked what HUD is doing to decrease the cost of housing and to build more housing. “I wish I could control the cost of housing,” Fudge said.
• Committee Ranking Member Maxine Waters (D-CA) noted that conservative House Republicans have repeatedly pushed back on funding additional housing programs and subsidies. “Republicans don’t support the subsidies that are needed to build housing,” Waters said.
• Representative Joyce Beatty (D-OH) noted the House’s fiscal year 2024 HUD appropriations bill, which seeks to cut the HOME program by 75% compared to FY23. A decade ago, HUD funding made up 7% of the federal discretionary budget; today, it represents 1%, Fudge said.
• Representative Jim Himes (D-CT) asked Fudge what share of new housing being build would need subsidy in order to be affordable for people with low incomes. “All affordable housing demands subsidy” in order to be affordable, Fudge said. LeadingAge has steadfastly supported additional funding to expand the supply of affordable housing and opposed cuts to housing programs.
• Representative Nydia Velazquez (D-NY) asked what HUD is doing to reduce insurance costs for HUD multifamily properties. Fudge responded without details, saying that HUD, its Federal Housing Administration, and others in the federal government are talking about rising insurance costs and their impact on the cost of housing.
• Fudge said direction from Congress would be helpful. For example, on whether and how to streamline HUD’s income eligibility calculations for disabled veterans with those of the VA and the Treasury, which has jurisdiction over the low income housing tax credit (LIHTC) program. This issue was of concern to both McHenry and Representative Brad Sherman (D-CA), who requested that HUD not consider service-connected disability payments to veterans as income for purposes of program eligibility. Fudge said HUD is working through this issue.
• Representative Andy Barr (R-KY) pushed back on the federal government’s emphasis on Housing First as the way to end homelessness. Fudge said Housing First is not the only way, but one way, and all viable solutions should be considered. Barr posited that the Housing First approach is deepening, rather than solving, homelessness in the United States—to which Fudge agreed.
• When asked what can be done to increase affordable housing supply, Fudge talked about the important role of mayors and other local officials have in allowing and encouraging affordable housing.
• Representative Barry Loudermilk (R-GA) said that HUD’s proposed 30-day notice of eviction for HUD tenants for non-payment of rent, which LeadingAge supports, “will continue federal interference with established state eviction laws and court processes.” Should eviction laws be the jurisdiction of the states? There are many things states should do but there are also things that need continuity nationally, Fudge said. Loudermilk said finalization of the rule as proposed would create confusion because tenants understand the eviction laws of their jurisdiction, something Fudge reported would be considered as part of comments to the proposed rule.
• Investor-purchased homes, which Representative Steven Horsford’s (D-NV) said large, out-of-state, investor groups are rapidly purchasing homes in his district and taking them off of the market but also putting them up for rent at higher costs than other homes. When these corporations do put these homes up for rent, they charge higher rents, evict at higher rates, and don’t maintain the homes, which lowers the value of others’ homes, said Horsford. Fudge agreed this is a major problem as large swaths of housing inventory are taken out of the marketplace.