One of REBIC’s stated areas of impact centers on improving the supply of attainable housing for work-force residents, and others that have been affected by market conditions, supply chain issues, and unchecked regulatory burdens. We’re pleased to inform you that numerous bills have been introduced in the North Carolina legislature with more on the way and we see this as definite progress.
Reducing the amount of property tax an individual or couple must pay is one of the strategies we have identified to preserve and generate attainable housing options. (Want to know more about these areas of impact in Policy and Law?)
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Current bills are noted here: Search Results – Bill Text – North Carolina General Assembly
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REBIC’s Six Strategies for Housing:
Homestead Exemption – The goal is relief from higher property tax bills, and to limit the possibility of displacement.
Adaptive Reuse/Retrofit Existing Commercial Buildings – Property studies & policy recommendations work is currently underway. The goal is to utilize existing buildings to meet housing needs and for other practical uses. All challenging strategies, but we know that tax abatement and other regulatory changes could help move this forward and make it more of a reality.
Establish a State Tax Credit – With disaster relief a big priority in Western North Carolina, no state tax credit is expected to pass this year, but we have hopes for future progress.
Modernize Housing Authority Act – Amend the 20% set aside for 60% Area Median Income (AMI) to 10% and 80% respectively, which would, with building material and land costs what they are, logically result in more units produced to help house more people.
Expand Use of Accessory Dwelling Units (ADUs) – Legislation, Charlotte UDO, other modifications surrounding ADU’s are likely this year, and will boost an income stream for property owners as well as open up possibilities for lower cost housing.
Address the Role of Local Regulatory Burden – Increase work force housing development, enhance review for affordable housing projects, and provide administrative flexibility are being explored by the City of Charlotte in the form of a Pilot Program likely to be launched as early as April 2025.
My Take: We developed these six strategies a couple of years ago when we saw housing prices start to spike, knowing the cascading negative effect would require action from an advocacy standpoint. Taken separately, any one of these would not likely move the needle. However, if utilized in concert, these measures could really make a difference and result in supply increases across many price points. Some decision makers would have us rely on a band aid approach, imposing additional mandates, as has been tested in other markets. These efforts have often led to even higher housing costs for the vast majority of those impacted. Let’s agree to empower our elected officials to take bold measures that move us in the right direction.
(Article reproduced from NAHB)
In a win for NAHB and the housing industry, the Trump administration has announced a six-month delay in the implementation of the Biden administration’s mandatory energy code, an important step forward to help ease the nation’s housing affordability crisis.
Specifically, the Department of Housing and Urban Development (HUD) will wait an additional six months before enforcing the compliance dates for adopting the 2021 International Energy Conservation Code (IECC) and ASHRAE 90.1-2019 as the minimum energy-efficiency standards for certain single-family and multifamily housing programs. NAHB urges the U.S. Department of Agriculture to take the same action soon.
“This six-month pause by HUD is an important step forward to help ease the nation’s housing affordability crisis,” said NAHB Chairman Buddy Hughes. “Compliance with this rule would make it much harder for home builders and multifamily developers to build housing that is available and affordable for American families.
In fact, the Home Innovation Research Labs has found that compliance with the 2021 IECC can add more than $20,000 to the price of a new home, but in practice, home builders have estimated increased costs of up to $31,000. (See My Take to put this into perspective for the home buyer.*)
Review the updated compliance dates and read the article on NAHB
My Take: We reported on this development several months ago when the initial requirement was imposed by the Biden administration. We don’t believe in pushing against beneficial, common-sense measures and nobody I know would argue against the homebuilding industry elevating energy efficiency in homes. But, we have to maintain a balance that does not run counteractive to the goal, which is to constantly seek remedies that will openly encourage a free market. We believe in supporting strategies that will allow us to build more affordable products without additional hurdles being imposed at every turn. — This move by HUD is a step in the right direction and displays a mindset shift that we hope will continue. We look forward to the development of a more sensible and reasonable rule.
*Estimated costs of up to $31,000? Let’s put this into perspective. Using a proposed current rate of 6.507 APR, the payment increase could be as high as $192.00 per month. Given the 28% ratio of payment to income required by many mortgage lenders, that means the buyer would need a whopping additional $11,520 per year to buy the same home under this rule. The current Charlotte household median income is $78,438. (REBIC is only offering estimates, and these are not intended to be used as actual numbers to quality for a mortgage. See your mortgage professional for complete details.)
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