November 16, 2023

Gallego Calls on HUD to Lower Costs for Arizona Renters

PHOENIX, AZ –Today, Rep. Ruben Gallego (AZ-03), sent a letter to U.S. Department of Housing and Urban Development (HUD) Secretary Marcia Fudge, calling on the Department to do more to address the housing affordability crisis facing states like Arizona and to increase financing of multifamily housing.

“Arizona’s affordable housing supply crisis is not a new phenomenon. From 2011 to 2020, only 240,000 new housing units were built in metro Phoenix. The economic fallout from the COVID-19 pandemic further compounded the Arizona housing crisis. Phoenix experienced a drastic 60% surge in the median sale price of homes from April 2020 to May 2022. The median monthly rent followed suit, increasing by 29% from March 2020 to March 2022, and evictions have also remained well above pre-COVID levels. In Maricopa County, eviction filings are on pace to exceed 82,000 in 2023, the highest annual count of renters in danger of eviction since 2007. The current housing crisis is an existential threat to tens of millions of hardworking Americans and their families, including Arizonans,” Rep. Gallego wrote.

He continues, “A critical component to increasing the supply of affordable housing through FHA programming is having loan limits consistent with the current economic climate. Unfortunately, base allowable loan limits for HUD programs have fallen below multifamily property values, impeding growth in the affordable housing supply. I am concerned that the current methodology used by HUD does not adequately mirror housing construction costs nationwide.”

In light of this crisis, Rep. Gallego posed the following questions:

  1. How can Congress adequately update multifamily financing limits that are outdated?

  2. What steps are HUD and the FHA taking to ensure that federal lending programs keep pace with the needs of the housing market?

  3. What is HUD doing to promote competitiveness for MAP lenders in the housing market?

  4. How is HUD working to increase flexibility for applications already in progress to increase the supply of rental housing?

Full text of the letter can be found HERE.

Last month, Rep. Gallego announced his support for the bipartisan Homes for Every Local Protector, Educator, and Responder (HELPER) Act, which would establish a new home loan program under the FHA to make homeownership more accessible to teachers and first responders by eliminating some of the barriers for first-time homebuyers, like a down payment and monthly mortgage insurance premiums.

Also in October, he announced that $12 million for affordable housing development is coming to Arizona through the U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund), which Rep. Gallego has long supported. This was on top of the $10 million he announced for Choice Neighborhoods Implementation in Phoenix and the $93.5 million in HUD funding to support affordable housing, community development and homeless assistance in Arizona he cheered earlier this year.