Housing Issues in the 116th Congress
October 16, 2020
Since the outbreak of the Coronavirus Disease 2019 (COVID-19) pandemic in early 2020 and the
resulting economic recession, pandemic relief and response has dominated the housing policy
Katie Jones, Coordinator
considerations of the second session of the 116th Congress. The CARES Act (P.L. 116-136),
Analyst in Housing Policy
enacted in March 2020, contained several housing-related provisions. These included nearly $15

billion in supplemental funding for housing-related COVID-19 relief and response as well as
policies such as a temporary eviction moratorium for some properties and forbearance for some
Darryl E. Getter
mortgages. Since then, the Administration issued an order implementing a nationwide eviction
Specialist in Financial
Economics
moratorium, and additional relief legislation has been introduced and considered in Congress.

Pandemic relief and response are not the only housing issues that have been considered by the
Mark P. Keightley
116th Congress. Others include topics related to housing finance, federal housing assistance
Specialist in Economics
programs, and housing-related tax provisions, among other things. Particular issues that have

been of interest to Congress include the following:
Maggie McCarty
Specialist in Housing Policy
 The status of Fannie Mae and Freddie Mac, two government-sponsored enterprises

(GSEs) that have been in conservatorship since 2008, including administrative actions
Libby Perl
taken by their regulator, the Federal Housing Finance Agency (FHFA).
Specialist in Housing Policy
 Appropriations for federal housing programs, including programs at the Department of

Housing and Urban Development (HUD) and rural housing programs administered by
Elizabeth M. Webster
the U.S. Department of Agriculture (USDA).
Analyst in Emergency
 Oversight of the implementation of certain changes to federal assisted housing programs Management and Disaster
that were enacted in prior Congresses, such as expansions of HUD’s Moving to Work
Recovery
(MTW) program and Rental Assistance Demonstration (RAD) program, and proposed

Administration actions, including a proposed rule to modify noncitizen eligibility for
Lida R. Weinstock
assisted housing programs.
Analyst in Macroeconomic
 Considerations related to housing and the federal response to major disasters, including
Policy
emergency sheltering options that may be implemented during the COVID-19

pandemic, ongoing issues related to oversight of the Federal Emergency Managemen t
Agency’s (FEMA’s) implementation of certain changes to assistance that were enacted

in the previous Congress, and a bill to formally authorize the Community Development
Block Grant-Disaster Recovery program.
 Consideration of legislation related to certain federal housing programs, including bills related to programs
that provide assistance to Native Americans living in tribal areas , to serve youth aging out of foster care,
and to further regulate the quality of federally assisted housing.
 Consideration of legislation to extend certain temporary tax provisions that had expired, including housing-
related provisions that provide a tax exclusion for canceled mortgage debt and allow for the deductibility of
mortgage insurance premiums, respectively.
Housing and mortgage market conditions provide context for these and other issues that Congress may consider, although
housing markets are local in nature and national housing market indicators do not necessarily accurately reflect conditions in
specific communities. On a national basis, some key characteristics of owner-occupied housing markets and the mortgage
market in recent years include increasing housing prices, low mortgage interest rates, and home sales that have been
increasing but constrained by a limited inventory of homes on the market. Key characteristics of rental housing markets
include an increasing number of renters, low rental vacancy rates, and increasing rents. Rising home prices and rents that
have outpaced income growth in recent years have led to policymakers and others increasingly raising concerns about the
affordability of both owner-occupied and rental housing. Affordability challenges are most prominent among the lowest-
income renter households, reflecting a shortage of rental housing units that are both affordable and available to this
population. The housing-related implications of the COVID-19 pandemic and its resulting recession on U.S. markets and
households are still unfolding.
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Housing Issues in the 116th Congress

Introduction
In March 2020, the Coronavirus Disease 2019 (COVID-19) pandemic began having wide-ranging
public health and economic effects in the United States. The impacts of the pandemic have
implications for housing, including the ability of households experiencing income disruptions to
make housing payments. In response, Congress and the Administration have taken a variety of
actions related to COVID-19 and housing. However, the pandemic is continuing and the economy
is in a recession. Some initial assistance measures have ended, and there have been cal s for
additional action. The longer-term consequences of the pandemic and associated economic
turmoil on housing markets remain unclear.
Outside of pandemic-related housing issues, several other housing-related issues have been active
during the 116th Congress. These include issues related to assisted housing programs, such as
those administered by the Department of Housing and Urban Development (HUD), and issues
related to housing finance, among other things. Specific topics of interest include issues such as
the status of two government-sponsored enterprises, Fannie Mae and Freddie Mac; how to
prioritize appropriations for federal housing programs in a limited funding environment;
oversight of the implementation of changes to certain housing programs that were enacted in prior
Congresses; administrative changes to certain affordable housing policies and programs; and the
extension of certain temporary housing-related tax provisions.
This report provides a high-level overview of the most prominent housing-related issues that have
been of interest during the 116th Congress. It begins with an overview of housing and mortgage
market conditions during the Congress to date. While this overview includes some national-level
statistics from the months after the pandemic began, it is stil too early to know how the pandemic
wil ultimately affect housing markets in the medium or longer term. The following section
discusses housing-related concerns related to the COVID-19 pandemic and federal housing
responses. Final y, the report discusses other housing issues that have been active during the 116th
Congress.
The discussion in this report provides a broad overview of major issues and is not intended to
provide detailed information or analysis. It includes references to more in-depth CRS reports on
these issues where possible.
Housing and Mortgage Market Conditions
This section provides background on housing and mortgage market conditions during the 116th
Congress to provide context for the housing policy issues discussed in the remainder of the report.
This discussion of market conditions is at the national level. Local housing market conditions can
vary dramatical y, and national housing market trends may not reflect the conditions in a specific
area. Nevertheless, national housing market indicators can provide an overal sense of general
trends in housing.
In general, rising home prices, low interest rates, and rising rental costs have been prominent
features of housing and mortgage markets in recent years. Although interest rates have remained
low, rising house prices and rental costs that in many cases have outpaced income growth have
led to increased concerns about housing affordability for both prospective homebuyers and
renters.
As the COVID-19 pandemic took hold in the United States beginning in March 2020, some
housing indicators showed notable changes. For example, interest rates fel , and home sales and
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construction activity experienced significant declines, although sales and construction indicators
rebounded to varying degrees in subsequent months. Other housing market indicators, such as
house prices, have shown only relatively slight changes to date. Since these indicators reflect
national-level conditions, conditions in specific local housing markets may differ. Going forward,
the pandemic’s impacts on housing market conditions are highly uncertain and wil depend on a
variety of factors.
Owner-Occupied Housing Markets and the Mortgage Market
Most homebuyers take out a mortgage to purchase a home. Therefore, owner-occupied housing
markets and the mortgage market are closely linked, although they are not the same. The ability
of prospective homebuyers to obtain mortgages, and the costs of those mortgages, impact housing
demand and affordability. The following subsections show current trends in selected owner-
occupied housing and mortgage market indicators.
House Prices
As shown in Figure 1, nominal house prices have increased national y on a year-over-year basis
in each quarter since the beginning of 2012, with year-over-year increases exceeding 5% for
much of that time period and exceeding 6% at times. These increases followed almost five years
of house price declines in the years during and surrounding the economic recession of 2007-2009
and associated housing market turmoil.
Year-over-year house price increases have slowed somewhat but continued to exceed 5% through
the second quarter of 2020, despite the onset of the COVID-19 pandemic.1
Figure 1. Year-over-Year House Price Changes (Nominal)
Q1 1995–Q2 2020

Source: Figure created by CRS using data from the Federal Housing Finance Agency House Price Index
(Seasonal y Adjusted Purchase-Only Index).
Notes: Figure shows the percentage change in nominal house prices compared to the same quarter in the
previous year.

1 See Federal Housing Finance Agency, House Price Index (HPI) Quarterly Report, 2020Q2 and June 2020, August
25, 2020, https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2020Q2_HPI.pdf.
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House prices, and changes in house prices, vary greatly across local housing markets. Some areas
of the country can experience rapid increases in house prices while other areas experience slower
or stagnating house price growth. Furthermore, house price increases affect participants in the
housing market differently. Rising prices reduce affordability for prospective homebuyers, but
they are general y beneficial for current homeowners due to the increased home equity that
accompanies them (although rising house prices also have the potential to negatively impact
affordability for current homeowners through increased property taxes).
Interest Rates
For several years, mortgage interest rates have been low by historical standards. Lower interest
rates increase mortgage affordability and make it easier for some households to purchase homes
or refinance their existing mortgages.
As shown in Figure 2, average mortgage interest rates have been consistently below 5% since
May 2010 and have been below 4% for several stretches during that time. After starting to
increase somewhat in late 2017 and much of 2018, mortgage interest rates have been general y
declining since late 2018.
Since the COVID-19 pandemic began, interest rates have fal en even further, in part due to
federal monetary policy responses to the pandemic. At times, interest rates have been below 3%,
their lowest levels since at least 1971.2 The average mortgage interest rate for August 2020 was
2.94%, compared to 3.02% in the previous month and 3.62% a year earlier.
Figure 2. Mortgage Interest Rates
January 1995–August 2020

Source: Figure created by CRS based on data from Freddie Mac’s Primary Mortgage Market Survey, 30-
Year Fixed Rate Historic Tables, available athttp://www.freddiemac.com/pmms/.
Notes: Freddie Mac surveys lenders on the interest rates they are charging for certain types of mortgage
products. The actual interest rate paid by any given borrower wil depend on a number of factors.

2 For example, see Freddie Mac, “Mortgage Rates Drop, Hitting a Record Low for th e Eighth T ime this Year,” press
release, August 6, 2020, https://freddiemac.gcs-web.com/node/20476/pdf.
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Homeownership Affordability
House prices have been rising for several years on a national basis, and mortgage interest rates,
while low currently, have also risen for certain stretches. While incomes have also been rising in
recent years, helping to mitigate some affordability pressures, on the whole house price increases
have outpaced income increases.3 Home price-to-income ratios have been generally trending
upwards since around 2012, with the national median sales price for an existing home more than
4.1 times the median household income in 2018.4 These trends have led to increased concerns
about the affordability of owner-occupied housing.
Despite rising house prices, many metrics of housing affordability suggest that owner-occupied
housing is currently relatively affordable.5 These metrics general y measure the share of income
that a median-income family would need to qualify for a mortgage to purchase a median-priced
home, subject to certain assumptions. Therefore, rising incomes and, especial y, interest rates that
are stil low by historical standards contribute to monthly mortgage payments being considered
affordable under these measures despite recent house price increases.
Some factors that affect housing affordability may not be captured by these metrics. For example,
several of the metrics are based on certain assumptions (such as a borrower making a 20% down
payment) that may not apply to many households. Furthermore, because they typical y measure
the affordability of monthly mortgage payments, they often do not take into account other
affordability chal enges that homebuyers may face, such as affording a down payment and other
upfront costs of purchasing a home (costs that general y increase as home prices rise). Other
factors—such as the ability to qualify for a mortgage, the availability of homes on the market, and
regional differences in house prices and income—may also make homeownership less attainable
for some households.6 Some of these factors may have a bigger impact on affordability for
specific demographic groups, as income trends and housing preferences are not uniform across al
segments of the population.7
It is unclear how the COVID-19 pandemic may ultimately impact the affordability of
homeownership. The pandemic could have implications for a variety of interrelated factors that
affect affordability, including factors related to both the supply of homes on the market and the
demand for homes.

3 See Joint Center for Housing Studies of Harvard University, State of the Nation’s Housing 2018, p. 22,
http://www.jchs.harvard.edu/sites/default/files/Harvard_JCHS_State_of_the_Nations_Housing_2018.pdf , showing
changes in median house prices and median household incomes (in real terms).
4 Joint Center for Housing Studies of Harvard University, State of the Nation’s Housing 2019, p.12,
https://www.jchs.harvard.edu/state-nations-housing-2019.
5 For example, see U.S. Department of Housing and Urban Development (HUD), Housing Market Indicators Monthly
Update, August 2020, p.3, https://www.huduser.gov/portal/sites/default/files/pdf/Housing-Market -Indicators-Report -
August-2020.pdf, showing the National Association of Realtors Housing Affordability Index (HAI) compared to its
historical norm. (For more information on the HAI, see the National Association of Realtors website
at https://www.nar.realtor/research-and-statistics/housing-statistics/housing-affordability-index/methodology.) See also
the Urban Institute’s Housing Finance Policy Center’s Housing Finance at a Glance: A Monthly Chartbook, August
2020, p. 21,
https://www.urban.org/sites/default/files/publication/102776/august-chartbook-2020.pdf.
6 Freddie Mac Insight, If Housing Is So Affordable, Why Doesn't It Feel That Way?, July 19,
2017, http://www.freddiemac.com/research/insight/20170719_affordability.html.
7 For example, see the discussion of affordability challenges for younger households in Freddie Mac Insight , Locked
Out? Are Rising Housing Costs Barring Young Adults from Buying Their First Hom es?, June
2018, http://www.freddiemac.com/research/pdf/201806-Insight -05.pdf.
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Home Sales
Annual home sales increased between 2014 and 2017, improving from their levels during the
housing market turmoil of the late 2000s. The overal number of home sales declined from the
previous year in 2018 and remained steady in 2019. While home sales have been improving
somewhat in recent years (prior to fal ing in 2018), the supply of homes on the market has
general y not been keeping pace with the demand for homes, thereby limiting home sales activity
and contributing to house price increases.
Home sales include sales of both existing and newly built homes. Existing home sales general y
number in the mil ions each year, while new home sales are usual y in the hundreds of
thousands. Figure 3 shows the annual number of existing and new home sales for each year from
1995 through 2019. Existing home sales numbered about 5.3 mil ion in 2019, steady from the
previous year and a decline from 5.5 mil ion in 2017 (existing home sales in 2017 were the
highest level since 2006). New home sales numbered about 683,000 in 2019, an increase from
617,000 in 2018 and the highest level since 2007. However, the number of new home sales
remains appreciably lower than in the late 1990s and early 2000s, when they tended to be
between 800,000 and 1 mil ion per year.
Figure 3. New and Existing Home Sales
Annual, 1995–2019

Source: Figure created by CRS using data from HUD’s U.S. Housing Market Conditions reports, available
at https://www.huduser.gov/portal/ushmc/home.html, which use data from the National Association of Realtors
for existing home sales and the U.S. Census Bureau for new home sales.
While Figure 3 shows annual home sales through 2019, monthly home sales have been impacted
since the pandemic began. Both new and existing home sales fel sharply in March and April
2020, though both rebounded during the summer months.8

8 HUD, Housing Market Indicators Monthly Update, August 2020 , pages 1-2, https://www.huduser.gov/portal/sites/
default/files/pdf/Housing-Market -Indicators-Report -August-2020.pdf.
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Housing Inventory and Housing Starts
The number and types of homes on the market affect home sales and home prices. On a national
basis, the supply of homes on the market has been relatively low in recent years,9 and in general
new construction has not been creating enough new homes to meet demand.10 However, as noted
previously, national housing market indicators are not necessarily indicative of local conditions.
While many areas of the country are experiencing low levels of housing inventory that contribute
to higher home prices, other areas, particularly those experiencing population declines, face a
different set of housing chal enges, including surplus housing inventory and higher levels of
vacant homes.11
On a national basis, the inventory of homes on the market has been below historical averages in
recent years, though the inventory of new homes, in particular, has begun to increase somewhat
of late.12 Homes come onto the market through the construction of new homes and when current
homeowners decide to sel their existing homes. Existing homeowners’ decisions to sel their
homes can be influenced by expectations about housing inventory and affordability. For example,
current homeowners may choose not to sel if they are uncertain about finding new homes that
meet their needs, or if their interest rates on new mortgages would be substantial y higher than the
interest rates on their current mortgages. New construction activity is influenced by a variety of
factors including labor, materials, and other costs as wel as the expected demand for new homes.
One measure of the amount of new construction is housing starts. Housing starts are the number
of new housing units on which construction is started in a given period and are typical y reported
monthly as a “seasonal y adjusted annual rate.” This means that the number of housing starts
reported for a given month (1) has been adjusted to account for seasonal factors and (2) has been
multiplied by 12 to reflect what the annual number of housing starts would be if the current
month’s pace continued for an entire year.13
Figure 4 shows the seasonal y adjusted annual rate of starts on one-unit homes for each month
from January 1995 through July 2020.14 Housing starts for single-family homes fel during the

9 For example, see HUD’s U.S. Housing Market Conditions National Housing Market Summary, 1st Quarter 2020, June
2020, p. 3, https://www.huduser.gov/portal/sites/default/files/pdf/NationalSummary_1Q20.pdf.
10 For example, see Freddie Mac, The Major Challenge of Inadequate U.S. Housing Supply, Economic & Housing
Research Insight, December 2018, http://www.freddiemac.com/fmac-resources/research/pdf/201811-Insight-06.pdf and
The Housing Supply Shortage: State of the States, Economic & Housing Research Insight, February 2020,
http://www.freddiemac.com/fmac-resources/research/pdf/202002-Insight -12.pdf.
11 For example, see Freddie Mac, The Housing Supply Shortage: State of the States, Economic & Housing Research
Insight, February 2020, p. 3, http://www.freddiemac.com/fmac-resources/research/pdf/202002-Insight -12.pdf; Jenny
Schuetz, The Goldilocks problem of housing supply: Too little, too m uch, or just right? , Brookings Institution,
December 14, 2018, https://www.brookings.edu/research/the-goldilocks-problem-of-housing-supply-too-little-too-
much-or-just-right/; and Alan Mallach, The Em pty House Next Door: Understanding and Reducing Vacancy and
Hypervacancy in the United States, Lincoln Institute of Land Policy, 2018, pp. 22 -26, https://www.lincolninst.edu/sites/
default/files/pubfiles/empty-house-next -door-full.pdf.
12 HUD, U.S. Housing Market Conditions National Housing Market Summary, 1st Quarter 2020, June 2020, pp. 1-3,
https://www.huduser.gov/portal/sites/default/files/pdf/NationalSummary_1Q20.pdf.
13 T he Census Bureau defines the seasonally adjusted annual rate as “the seasonally adjusted monthly value multiplied
by 12” and notes that it “is neither a forecast nor a projection; rather it is a description of the rate of building permits,
housing starts, housing completions, or new home sales in the particular month for which they are calculated.” See U.S.
Census Bureau, “New Residential Construction,” at https://www.census.gov/construction/nrc/definitions/index.html#s.
14 T he number of housing starts is consistently higher than the number of new home sales. T his is prima rily because
housing starts include homes that are not intended to be put on the for -sale market, such as homes built by the owner of
the land or homes built for rental. See the U.S. Census Bureau, “Comparing New Home Sales and New Residential
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housing market turmoil of the late 2000s, reflecting decreased home purchase demand. In recent
years, levels of new construction have remained relatively low by historical standards, reflecting
a variety of considerations including labor shortages and the cost of building.15 Housing starts
have general y been increasing since about 2012, but remain wel below their levels from the late
1990s through the mid-2000s. For 2019, the seasonal y adjusted annual rate of housing starts
averaged about 893,000. In comparison, the seasonal y adjusted annual rate of housing starts
exceeded 1 mil ion from the late 1990s through the mid-2000s.
Single-family housing starts showed a significant drop as the pandemic began, though they have
begun to recover somewhat in the months since then.16 Single-family housing starts in July were
higher than in the previous July, though not as high as the months in late 2019 and early 2020.17
Figure 4. Housing Starts
By month; seasonal y adjusted annual rate

Source: Figure created by CRS using data from the U.S. Census Bureau, New Residential Construction
Historical Data, http://www.census.gov/construction/nrc/historical_data/. Data are through July 2020.
Notes: Figure reflects starts in one-unit structures only, some of which may be built for rent rather than sale.
The seasonal y adjusted annual rate is the number of housing starts that would be expected if the number of
homes started in that month (on a seasonal y adjusted basis) were extrapolated over an entire year.
High housing construction costs have led to a greater share of new housing being built at the
more expensive end of the market over the last several years. To the extent that new homes are

Construction,” https://www.census.gov/construction/nrc/salesvsstarts.html.
15 For example, see Freddie Mac, “What is Causing the Lean Inventory of Houses?,” Outlook Report, July 27, 2017,
http://www.freddiemac.com/research/forecast/20170726_lean_inventory_of_houses.page.
16 T he Census Bureau notes that its data collection methods for this survey were impacted by the pandemic, though it
says that “ ... processing and data quality were monitored throughout the month [of July] and quality metrics, including
response rates, fell within normal ranges for these surveys.” For more information on how data collection was
impacted, see U.S. Census Bureau, “Frequently Asked Questions (FAQs) COVID-19’s Effect on the July 2020 New
Residential Construction Indicator,” https://www.census.gov/construction/nrc/pdf/newresconst_202007_notes.pdf.
17 For data on housing starts and other measures of residential construction (both single-family and multifamily), see
U.S. Census Bureau, New Residential Construction, https://www.census.gov/construction/nrc/index.html.
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concentrated at higher price points, supply and price pressures may be exacerbated for lower-
priced homes.18
Mortgage Market Composition
After a mortgage is originated, it might be
held in a financial institution’s asset
Figure 5. Share of Mortgage Originations
portfolio, or it might be securitized through
by Type
one of several channels.19 Two government-
2019
sponsored enterprises (GSEs), Fannie Mae
and Freddie Mac, issue mortgage-backed
securities and guarantee investors’
payments on those securities. Mortgages
that are insured or guaranteed by a federal
agency, such as the Federal Housing
Administration (FHA) or the Department of
Veterans Affairs (VA), are eligible to be
included in mortgage-backed securities
guaranteed by Ginnie Mae, part of the
Department of Housing and Urban
Development (HUD). Private companies
can also issue mortgage-backed securities

without a government or GSE guarantee,
known as private label securities. The
Source: Figure created by CRS based on Inside
Mortgage Finance data as reported in Urban Institute,
shares of mortgages that are provided
Housing Finance Policy Center, Housing Finance at a
through each of these channels may be
Glance: A Monthly Chartbook, February 2020, p. 8.
relevant to policymakers because of their
Notes: Figure shows share of first-lien mortgage
implications for mortgage access and
originations by dol ar volume.
affordability as wel as the federal
government’s exposure to risk.
As shown in Figure 5, a little under two-thirds of the total dollar volume of mortgages originated
was either backed by Fannie Mae or Freddie Mac (43%) or guaranteed by a federal agency such
as FHA or VA (19%) in 2019. Over one-third of the dollar volume of mortgages originated was
held in bank portfolios, while close to 2% was included in a private-label security without
government backing.
The shares of mortgage originations backed by Fannie Mae and Freddie Mac and held in bank
portfolios are roughly similar to their respective shares in the early 2000s. The share of private-
label securitization has been, and continues to be, smal since the housing market turmoil of the
late 2000s, while the FHA/VA share is higher than it was in the early and mid-2000s.20 The share
of mortgages insured by FHA or guaranteed by VA was low by historical standards during that

18 For example, see Joint Center for Housing Studies of Harvard University, State of the Nation’s Housing, 2019, p. 8,
https://www.jchs.harvard.edu/sites/default/files/Harvard_JCHS_ State_of_the_Nations_Housing_2019.pdf ; and Jung
Hyun Choi, Laurie Goodman, and Bing Bai, “Four ways today’s high home prices affect the larger economy,” Urban
Institute, Urban Wire blog, October 11, 2018, https://www.urban.org/urban-wire/four-ways-todays-high-home-prices-
affect -larger-economy.
19 For more information on different types of mortgages and mortgage securitization channels, see CRS Report
R42995, An Overview of the Housing Finance System in the United States.
20 See Urban Institute, Housing Finance Policy Center, Housing Finance at a Glance: A Monthly Chartbook, July 2020,
p. 8, for a graph showing mortgage market composition since 2001 .
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time period as many households opted for other types of mortgages, including subprime
mortgages.
Rental Housing Markets
As has been the case in owner-occupied housing markets, affordability has been a prominent
concern in rental markets in recent years. In the years since the housing market turmoil of the late
2000s, the number and share of renter households has increased, leading to lower rental vacancy
rates and higher rents in many markets. The extent to which these trends in rents and vacancies
wil continue in light of the pandemic and related policy responses—including the imposition of
various eviction moratoria discussed later in this report—is unclear.
Share of Renters
The housing and mortgage market turmoil of the late 2000s led to a substantial decrease in the
homeownership rate and a corresponding increase in the share of renter households. As shown in
Figure 6, the share of renters increased from about 31% in 2005 and 2006 to a high of about
36.6% in 2016, before beginning to decrease and reaching 35.4% in 2019. The homeownership
rate correspondingly fel from a high of 69% in the mid-2000s to 63.4% in 2016, before rising to
64.6% in 2019.21
Figure 6. Rental and Homeownership Rates
1965–2019

Source: Figure prepared by CRS based on data from the U.S. Census Bureau, Annual Housing Vacancy
and Homeownership Survey, Annual Statistics, Table 14, “Homeownership Rates by Area.”
The overal number of occupied housing units also increased over this time period, from nearly
110 mil ion in 2006 to 123 mil ion in 2019; most of this increase has been in renter-occupied
units.22 The number of renter-occupied units increased from about 34 mil ion in 2006 to about 44

21 U.S. Census Bureau, Housing Vacancies and Homeownership, Annual Statistics, http://www.census.gov/housing/
hvs/data/prevann.html.
22 U.S. Census Bureau, Housing Vacancies and Homeownership, Historical T ables, T able 7, “Annual Estimates of the
Housing Inventory: 1965 to Present,” http://www.census.gov/housing/hvs/data/histtabs.html.
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mil ion in 2019. The number of owner-occupied housing units fel from about 75 mil ion units in
2006 to about 74 mil ion in 2014, but has since increased to about 79 mil ion units in 2019.
In general, it is too early to know how the COVID-19 pandemic may influence the share of
households who rent or own their homes, as it wil take time for the effects of the pandemic on
owners and renters to fully play out and be reflected in the data.23
Rental Vacancy Rates
The higher number and share of renter households has had implications for rental vacancy rates
and rental housing costs. More renter households increases competition for rental housing, which
may in turn drive up rents if there is not enough new rental housing created (whether through new
construction or conversion of owner-occupied units to rental units) to meet the increased demand.
As shown in Figure 7, the rental vacancy rate has general y declined in recent years and was
6.4% at the end of 2019. The potential impact of the COVID-19 pandemic on rental vacancy rates
is unclear, in part because the pandemic has affected more recent data collection for this survey.24
Figure 7. Rental Vacancy Rates
Q1 1995–Q4 2019

Source: Figure created by CRS based on data from U.S. Census Bureau, Housing Vacancies and
Homeownership Historical Tables, Table 1, “Quarterly Rental Vacancy Rates: 1956 to
Present,” http://www.census.gov/housing/hvs/data/histtabs.html.

23 T he pandemic has impacted data collection for this survey, affecting the comparabilit y of the 2020 quarterly dat a to
previous periods. See, for example, Census Bureau, Frequently asked questions: The im pact of the coronavirus
(COVID-19) pandem ic on the Current Population Survey/Housing Vacancy Survey (CPS/HVS) ,
https://www.census.gov/housing/hvs/files/qtr220/impact_coronavirus_20q2.pdf; and McCue, Daniel, “ Buyer Beware:
A Cautionary Note on the Most Recent Homeownership Data from HVS,” Joint Cen ter for Housing Studies of Harvard
University, blog post, August 10, 2020, https://www.jchs.harvard.edu/blog/buyer-beware-a-cautionary-note-on-the-
most -recent -homeownership-data-from-hvs/.
24 See footnote 23 for more on how the pandemic has affected data collection for this survey.
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Rental Housing Affordability
Rental housing affordability is impacted by a variety of factors, including the supply of rental
housing units available, the characteristics of those units (e.g., age and amenities), the demand for
available units, and renter incomes. New housing units have been added to the rental stock in
recent years through both construction of new rental units and conversions of existing owner-
occupied units to rental housing. However, the supply of rental housing has not necessarily kept
pace with the demand, particularly among lower-cost rental units, and low vacancy rates have
been especial y pronounced in less-expensive units.25
The increased demand for rental housing, as wel as the concentration of new rental construction
in higher-cost units, has led to increases in rents in recent years. Rents have increased faster than
renter incomes, reducing rental affordability.26 Rising rental costs and renter incomes that are not
keeping up with rent increases over the long term can contribute to housing affordability
chal enges, particularly for households with lower incomes.
Under the most commonly used definition, housing is considered to be affordable if a household
is paying no more than 30% of its income in housing costs. Households that pay more than 30%
are considered to be cost-burdened, and those that pay more than 50% are considered to be
severely cost-burdened. The overal number of cost-burdened renter households increased from
14.8 mil ion in 2001 to 20.8 mil ion in 2018, or about 47% of al renters.27 (Over this time period,
the overal number of renter households has increased as wel .) While housing cost burdens can
affect households of al income levels, and have been growing among middle-income
households,28 they are most prevalent among the lowest-income households. In 2018, 83% of
renter households with incomes below $15,000 experienced housing cost burdens, and 72%
experienced severe cost burdens.29 A shortage of lower-cost rental units that are both available
and affordable to extremely low-income renter households (households that earn no more than
30% of area median income), in particular, contributes to these cost burdens.30

25 For example, see Joint Center for Housing Studies of Harvard University, America’s Rental Housing 2020, pp. 3,
https://www.jchs.harvard.edu/sites/default/files/Harvard_JCHS_Americas_Rental_Housing_2020.pdf.
26 See HUD, Office of Policy Development and Research, U.S. Housing Market Conditions National Housing Market
Sum m ary 1st Quarter 2020, June 2020, pp. 5-6, and underlying data available at https://www.huduser.gov/portal/
ushmc/quarterly_commentary.html. Data on median rents reflect median rents for recent movers less the cost of
utilities. For more information on data sources used, see HUD Office of Policy Development and Research, HUD’s
New Rental Affordability Index, https://www.huduser.gov/portal/pdredge/pdr-edge-trending-110716.html.
27 Joint Center for Housing Studies, America’s Rental Housing 2020, Appendix T ables, https://www.jchs.harvard.edu/
americas-rental-housing-2020, showing Joint Center for Housing Studies tabulations of American Community Survey
data.
28 See, for example, Whitney Airgood-Obrycki, “America’s Rental Affordability Crisis is Climbing the Income
Ladder,” Joint Center for Housing Studies of Harvard University, blog post, January 31, 2020,
https://www.jchs.harvard.edu/blog/americas-rental-affordability-crisis-is-climbing-the-income-ladder/.
29 Joint Center for Housing Studies, America’s Rental Housing 2020, Appendix T ables, https://www.jchs.harvard.edu/
americas-rental-housing-2020, showing Joint Center for Housing Studies tabulations of American Community Survey
data.
30 See Joint Center for Housing Studies of Harvard University, America’s Rental Housing 2020, p. 31,
https://www.jchs.harvard.edu/sites/default/files/Harvard_JCHS_Americas_Rental_Housing_2020.pdf; and National
Low Income Housing Coalition, The Gap: A Shortage of Affordable Hom es, March 2020, available at
https://reports.nlihc.org/gap.
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The COVID-19 Pandemic and Housing
The COVID-19 pandemic that began in early 2020 is having wide-ranging effects on public
health and the economy. The pandemic has led to a number of housing-related concerns,
including, among other things, concerns about housing insecurity among both renters and
homeowners.
Congress and federal agencies have responded to these concerns by taking a variety of actions. In
general, these actions have included providing additional federal funding for several housing
programs, establishing temporary protections for certain renters and homeowners, and taking
actions intended to support the housing finance system more broadly.
As the economy has entered recession and some temporary assistance measures have begun to
expire, many policymakers and others have cal ed for additional federal action. Numerous bil s
that would further address COVID-19-related housing issues have been introduced and some
have been considered.
This section of the report discusses the effects of COVID-19 on housing and federal responses to
date.
COVID-19 and Effects on Housing
The pandemic has led to increased housing insecurity as many households experience income
disruptions. Such disruptions can lead to difficulties making rent or mortgage payments.
According to data from the Census Bureau’s Pulse Survey, and as shown in Figure 8, 21% of
renters and 13% of owners reported having not made the current month’s housing payment as of
the week that ended on July 21. (These figures include those with deferred payments.) Larger
shares (35% and 17%, respectively) expected that they would not be able to pay the following
month.31

31 T hese figures reflect CRS calculations based on data in the Week 12 Household Pulse Survey, available at
https://www.census.gov/programs-surveys/household-pulse-survey/data.html. T hey include those who missed last
month’s payment or whose last month payment was deferred, and those who have slight or no confidence that they will
make next month’s payment or anticipate that next month’s payment will be deferred.
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Figure 8. Renters and Owners Having Difficulty Making Housing Payments
For the week ending July 21, 2020

Source: Figure created by CRS based on data from the Census Bureau’s Household Pulse Survey for Week 12
(July 16-July 21).
Thus far, many households have been protected by federal and state or local eviction or
foreclosure moratoriums. It is not yet clear to what extent renters and homeowners wil be able to
make their rent or mortgage payments or make up missed payments when protections expire.
(The end dates for eviction and foreclosure protections depend on a variety of factors, including
the specific protection in question and whether any extensions are issued.)
As described in the “Housing and Mortgage Market Conditions” section, data are beginning to
emerge about the trajectory of national housing market indicators during the first few months of
the pandemic. However, the full effects of COVID-19 on housing markets wil not be known for
some time. Such effects wil depend on a variety of factors, including the duration of the public
health threat and the timing and pattern of economic recovery, and involve a high degree of
uncertainty. Impacts may vary across the country based on differences in local housing markets as
wel as geographic variation in the prevalence of COVID-19 and local responses. The impacts are
likely to vary across demographic groups, due in part to existing differences in housing
conditions as wel as the uneven distribution of the health and economic consequences of the
pandemic.32

32 For example, see Sharon Cornelissen and Alexander Hermann, A Triple Pandemic? The Economic Impacts of
COVID-19 Disproportionately Affect Black and Hispanic Households, Joint Center for Housing Studies of Harvard
University, July 7, 2020, https://www.jchs.harvard.edu/blog/a-triple-pandemic-the-economic-impacts-of-covid-19-
disproportionately-affect-black-and-hispanic-households/; and Michael Neal and Alanna McCargo, How Econom ic
Crises and Sudden Disasters Increase Racial Disparities in Hom eownership, T he Urban Institute’s Housing Finance
Policy Center, June 1, 2020, https://www.urban.org/research/publication/how-economic-crises-and-sudden-disasters-
increase-racial-disparities-homeownership.
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Federal Housing Responses to COVID-19
On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act; P.L. 116-136), a COVID-19 response package that included, among
many other things, several provisions related to housing. These included certain temporary
protections for renters in properties with federal assistance or federal bac king and homeowners
with federally backed mortgages, as wel as increased funding for several housing programs.
Both prior to and since the passage of the CARES Act, federal agencies have taken various
administrative actions to address housing concerns related to COVID-19. In addition, on August
8, 2020, President Trump signed an Executive Order related to COVID-19 and housing.33 The
Executive Order directed several federal agencies to examine authorities or resources that they
may be able to use to further assist tenants or homeowners affected by COVID-19 to help them
avoid eviction or foreclosure. It did not itself provide any new resources or implement any
additional actions related to evictions and foreclosures. (For more information on this Executive
Order, see CRS Legal Sidebar LSB10532, President Trump’s Executive Actions on Student
Loans, Wage Assistance, Payroll Taxes, and Evictions: Initial Takeaways.) The Executive Order,
among other things, directed the Secretary of Health and Human Services (HHS) and the Centers
for Disease Control and Prevention (CDC) to consider whether measures to temporarily pause
evictions were necessary to prevent the spread of COVID-19 between states. On September 4,
2020, the CDC announced a national eviction moratorium to last until the end of the year.
Lawmakers have also introduced a variety of additional bil s to further address housing issues
related to COVID-19, though as of the date of this report none has been enacted.
Federal Interventions Related to Rental Housing
While al types of households may be at risk of housing instability due to COVID-19, renters may
be particularly vulnerable. This is both because more financial y vulnerable populations are more
likely to be renters, and because the process for evicting a household from a rental unit is
general y faster than the process of foreclosing on a mortgage. As such, there have been several
policy interventions aimed specifical y at aiding renters.
CARES Act Rental Housing Provisions
To protect renters experiencing COVID-19-related financial hardships, the CARES Act included
a 120-day moratorium on eviction filings for tenants in rental properties with federal assistance or
federal y related financing, as wel as a prohibition on charging late fees for nonpayment of rent
for the same time period. These protections were designed to al eviate the economic and public
health consequences of tenant displacement during the pandemic. They supplemented temporary
eviction moratoria and rent freezes implemented in states and cities by governors and local
officials using emergency powers. The CARES Act eviction moratorium expired on July 24,
though the law also required that landlords provide tenants with at least 30 days’ notice before
requiring tenants to vacate a covered property after the moratorium expired. Therefore, tenants
should not have been required to leave covered rental units until at least August 23.

33 Executive Order on Fighting the Spread of COVID-19 by Providing Assistance to Renters and Homeowners, issued
on August 8, 2020, https://www.whitehouse.gov/presidential-actions/executive-order-fighting-spread-covid-19-
providing-assistance-renters-homeowners/.

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Separate from the eviction moratorium, the CARES Act also included provisions related to
forbearance for federally backed multifamily mortgages (discussed further below). The CARES
Act provided that multifamily mortgage borrowers receiving forbearance must provide certain
tenant protections during the forbearance period. Namely, owners cannot evict tenants for
nonpayment of rent or charge late fees for the duration of the forbearance. Therefore, some
tenants may benefit from federal protection from eviction because they live in a property with a
federal y backed multifamily mortgage subject to a forbearance agreement.
In addition, other assistance provided in the CARES Act, such as federal unemployment
insurance supplemental payments (which have now expired), likely helped renters make housing
payments and therefore avoid eviction. While this assistance was not specific to housing,
households could use it to help maintain housing in light of income disruptions.
For more information on CARES Act protections for renters, see the following:
 CRS Insight IN11320, CARES Act Eviction Moratorium.
CDC’s National Eviction Moratorium
On September 4, the Centers for Disease Control and Prevention published an order in the
Federal Register implementing a national eviction moratorium through December 31, 2020.34 The
moratorium protects certain tenants from eviction for non-payment of rent. The CDC relied on
broad authority that it has to take actions to prevent the spread of communicable diseases between
states to implement this moratorium.35 In the Federal Register notice announcing it, the CDC
described the public health risks posed by evictions and their effects during a pandemic.
Unlike the CARES Act eviction moratorium, the CDC’s eviction moratorium potential y applies
to renters in any rental property, not just those with federal financing or federal assistance. While
the CARES Act moratorium applied automatical y to renters in covered properties, the CDC
moratorium requires eligible renters to provide landlords a document that attests to their
eligibility. Eligible renters must attest that they
 meet income eligibility criteria; namely, that they either 1) expect to have
incomes no higher than $99,000 ($198,000 if filing a joint tax return) in 2020, 2)
were not required to report income to the Internal Revenue Service in 2019, or 3)
received an Economic Impact Payment under Section 2201 of the CARES Act;
 have made “best efforts to obtain al available government assistance” to pay
rent;
 are unable to pay full rent due to certain specified hardships;
 are making “best efforts” to make partial payments as close as possible to the full
payment as circumstances permit; and
 would likely become homeless, move to a homeless shelter, or move into housing
with others in close quarters if evicted due to a lack of available housing options.
Renters must also attest that they understand that the order does not relieve them of the obligation
to pay rent, and does not prohibit landlords from charging fees, penalties, or interest in

34 Centers for Disease Control and Prevention, Department of Health and Human Services, “T emporary Halt in
Residential Evictions to Prevent the Further Spread of COVID-19,” 85 Federal Register 55292-55297, September 4,
2020.
35 T he CDC’s order cites its authority under Section 361 of the Public Health Service Act (42 U.S.C. §264) and
regulations at 42 CFR 70.2. See the Federal Register notice for the CDC’s discussion of the risk s that evictions pose to
public health.
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accordance with applicable contracts. (In contrast, the CARES Act prohibited landlords from
charging fees, penalties, or interest during the eviction moratorium.) The CDC moratorium does
not supersede state or local eviction moratoria that provide greater protections.
While the CARES Act did not explicitly include any penalties for noncompliance, the CDC’s
order specifies potential penalties (fines and/or jail time) for landlords who do not comply.
Renters who are not truthful in their attestations could be found guilty of perjury and be subject to
associated penalties.
The CDC’s national eviction moratorium order raises a variety of questions and is the subject of
legal chal enges.36 In addition to questions surrounding the CDC’s authority to issue such a
moratorium, there are questions around issues such as how enforcement is being carried out and
how many renters may seek protection. Industry groups representing property owners have raised
concerns about the impact of the eviction moratorium on owners, who may have difficulty
covering the costs of the property if tenants are unable to pay rent.37 Tenant advocates, while
general y welcoming the moratorium, have also noted that it does not help tenants pay rent and
have raised concerns about what happens to renters when the moratorium ends.38 Both owner and
tenant advocates have cal ed for federal rental assistance to help tenants make rent payments.39
For more information on the CDC’s eviction moratorium, see CRS Insight IN11516, Federal
Eviction Moratoriums in Response to the COVID-19 Pandemic.
Federal Interventions Related to Mortgages
The CARES Act requires mortgage servicers to grant forbearance requests for borrowers with
federal y backed mortgages who are experiencing a financial hardship related to COVID-19.40
Mortgage forbearance al ows a household to reduce or suspend mortgage payments for an agreed-
upon period of time, but it does not forgive the amounts owed; borrowers and mortgage servicers
must negotiate an agreement for the repayment of the missed amounts.
Under the CARES Act, forbearance for federal y backed single-family mortgages can be for up to
360 days (an initial period of up to 180 days, with an extension of up to an additional 180 days).
For federally backed multifamily mortgages, the forbearance can be for up to 90 days (an initial
period of up to 30 days, with two possible 30-day extensions).41 Federal y backed mortgages

36 See, for example, Brown v. Azar et al., 1:20-CV-03702, N.D. Ga.
37 See, for example, National Multifamily Housing Council, “Statement by NMHC President Doug Bibby on
Administration’s Enactment of Federal Eviction Moratorium,” September 1, 2020, https://www.nmhc.org/news/press-
release/2020/statement-by-nmhc-president -doug-bibby-on-administrations-enactment -of-federal-eviction-moratorium/.
38 See, for example, National Low Income Housing Coalition, “Statement from National Low Income Housing
Coalition President and CEO Diane Yentel on the White House Morato rium on Evictions for Nonpayment of Rent,”
September 1, 2020, https://nlihc.org/news/statement-national-low-income-housing-coalition-president -and-ceo-diane-
yentel-white-house.
39 Letter from California Housing Consortium et al., August 21, 2020, https://www.irem.org/File%20Library/
GlobalNavigation/Advocacy/CoalitionLetters/2020/08212020RentalAssistanceCoalitionLetter.pdf.
40 Prior to passage of the CARES Act, the federal agencies that back mortgages and the government -sponsored
enterprises Fannie Mae and Freddie Mac had each released guidance reminding mortgage servicers of existing options
to help borrowers having difficulties making mortgage payments, including forbearance, and encouraging or requiring
temporary suspensions on foreclosures. While much of this guidance was similar to the provisions included in the
CARES Act, the specifics varied by agency.
41 FHFA has since announced the availability of forbearance for multifamily mortgages backed by Fannie Mae or
Freddie Mac for up to an additional three months; tenant protections must apply for the duration of the forbearance. See
FHFA, “FHFA Provides T enant Protections,” press release, June 29, 2020, https://www.fhfa.gov/Media/PublicAffairs/
Pages/FHFA-Provides-T enant -Protections.aspx. HUD has also stated that FHA-insured multifamily mortgages in
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include those insured, guaranteed, or originated by a federal agency, such as HUD, USDA, or VA,
or purchased or securitized by two government-sponsored enterprises (GSEs), Fannie Mae and
Freddie Mac. They are estimated to constitute approximately 70% of outstanding single-family
mortgages.42
The CARES Act also temporarily suspended foreclosures on federally backed single-family
mortgages. The CARES Act foreclosure moratorium was in effect for 60 days from March 18,
2020; however, the federal agencies that back mortgages and Fannie Mae and Freddie Mac have
al since announced extensions. As of the date of this report, these entities had extended the
foreclosure moratorium for mortgages they back through December 31, 2020.43
Federal agencies that back mortgages, such as the Federal Housing Administration, and GSEs
such as Fannie Mae and Freddie Mac (along with their regulator, the Federal Housing Finance
Agency, or FHFA44) have also taken additional steps to assist borrowers and other mortgage
market participants.45 These steps have included the following:
 Assistance for Mortgage Borrowers: One question following mortgage forbearance is
how the borrower wil be required to repay missed payments. The CARES Act was silent
on this question. Several of the federal entities involved in mortgages have stated that
borrowers with mortgages they back who are not able to repay the missed amounts in a
lump sum at the end of the forbearance wil be offered other repayment options,46 and

forbearance may be able to have forbearance periods extended, and that tenant protections will apply during any
extended forbearance. See HUD Housing Notice H 20 -07, “ Coronavirus Aid, Relief, and Economic Security (CARES)
Act Eviction Moratorium,” issued July 1, 2020, p. 3, https://www.hud.gov/sites/dfiles/OCHCO/documents/20-
07hsgn.pdf.pdf.
42 See, for example, Karan Kaul and Laurie Goodman, “T he Price T ag for Keeping 29 Million Families in T heir
Homes: $162 Billion,” T he Urban Institute’s Housing Finance Policy Center, March 27, 2020, https://www.urban.org/
urban-wire/price-tag-keeping-29-million-families-their-homes-162-billion.
43 FHA Mortgagee Letter 2020-27, https://www.hud.gov/sites/dfiles/OCHCO/documents/2020-27hsgml.pdf; FHFA,
“FHFA Extends Foreclosure and REO Eviction Moratoriums,” https://www.fhfa.gov/Media/PublicAffairs/Pages/
FHFA-Extends-Foreclosure-and-REO-Eviction-Moratoriums.aspx; VA Circular 26-20-30,
https://www.benefits.va.gov/HOMELOANS/documents/circulars/26-20-30.pdf; USDA, “ USDA Implements
Immediate Measures to Help Rural Residents, Businesses and Communities Affected by COVID -19,” updated August
28, 2020, https://www.rd.usda.gov/sites/default/files/
COVID19_CUMULAT IVE_StakeholderNotification_WEEKLY_Aug28.pdf ; and HUD Office of Public and Indian
Housing Dear Lender Letter 2020-10, https://www.hud.gov/sites/dfiles/PIH/documents/DLL_2020-
10_Eviction_Moratorium_and_Loan_Processing_Flexibilities_Extension.pdf .
44 T he Federal Housing Finance Agency is the regulator and conservator for Fannie Mae and Freddie Mac as well as
the regulator of a third housing GSE, the Federal Home Loan Bank (FHLB) system. T he FHLBs have also taken steps
to address COVID-19-related issues; see the FHLB website at https://fhlbanks.com/covid-19/. For more information on
the FHLBs in general, see CRS Report R46499, The Federal Hom e Loan Bank (FHLB) System and Selected Policy
Issues.
45 Administrative actions and guidance related to the pandemic continue to evolve. Many federal agencies involved in
housing post pandemic-related guidance in a centralized location. For example, see HUD’s webpage on coronavirus
resources at https://www.hud.gov/coronavirus, the Federal Housing Finance Agency’s webpage on coronavirus
assistance information at https://www.fhfa.gov/Homeownersbuyer/MortgageAssistance/Pages/Coronavirus-Assistance-
Information.aspx, and USDA’s Rural Development COVID-19 response page at https://www.rd.usda.gov/coronavirus.
46 See “CARES Act Forbearance Fact Sheet for Borrowers with FHA, VA, or USDA Loans,” https://www.hud.gov/
sites/dfiles/SFH/documents/IACOVID19FBFactSheetConsumer.pdf; and FHFA, “ ‘No Lump Sum Required at the End
of Forbearance’ says FHFA’s Calabria,” press release, April 27, 2020, https://www.fhfa.gov/Media/PublicAffairs/
Pages/No-Lump-Sum-Required-at-the-End-of-Forbearance-says-FHFAs-Calabria.aspx.
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have announced specific options for deferring the missed amounts to the end of the loan
term.47
 Temporary Mortgage Origination Flexibilities: Certain aspects of the mortgage
origination process present chal enges during the pandemic. In response, federal entities
have made temporary changes to certain requirements for mortgages that they back in
order to minimize the effects on mortgage origination and home buying. These changes
include al owing for alternatives to interior home appraisals in some circumstances and
providing flexibilities related to the process for re-verifying a borrower’s employment
before closing.48 FHA and Fannie Mae and Freddie Mac have each also announced
temporary policies that al ow them to insure or purchase, respectively, mortgages that
otherwise meet their requirements but are in forbearance.49 (Usual y, mortgages that are
already in forbearance are not eligible for FHA insurance or purchase by Fannie Mae or
Freddie Mac.) To help balance the increased risk that these mortgages pose to these
entities, their acceptance of these mortgages is subject to certain conditions.50 Some
lawmakers have raised concerns about these conditions, however, and their potential
impact on mortgage credit access.51
 Support for Mortgage Servicers: Mortgage servicers are often required to advance
payments to investors in mortgage-backed securities even if the borrower has not made
their payments on time, including in the case of forbearance. Large volumes of delinquent
payments or mortgage forbearances can therefore cause liquidity issues for some

47 See FHA Mortgagee Letter 2020-06, “FHA’s Loss Mitigation Options for Single Family Borrowers Affected by the
Presidentially-Declared COVID-19 National Emergency in Accordance with the CARES Act,” April 1, 2020,
https://www.hud.gov/sites/dfiles/OCHCO/ documents/20-06hsngml.pdf; FHA Mortgagee Letter 2020-22, “ FHA’s
COVID-19 Loss Mitigation Options,” https://www.hud.gov/sites/dfiles/OCHCO/documents/20-22hsgml.pdf; and
FHFA, “FHFA Announces Payment Deferral as New Repayment Option for Homeowners in COVID-19 Forbearance
Plans,” press release, May 13, 2020, https://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Announces-Payment-
Deferral-as-New-Repayment -Option-for-Homeowners-in-COVID-19-Forbearance-Plans.aspx.
48 See, for example, FHFA, “FHFA Directs Enterprises to Grant Flexibilities for Appraisal and Employment
Verifications,” press release, March 23, 2020, https://www.fhfa.gov/media/PublicAffairs/Pages/FHFA-Directs-
Enterprises-to-Grant-Flexibilities-for-Appraisal-and-Employment-Verifications.aspx; and HUD, “ Re-verification of
Employment and Exterior-Only and Desktop-Only Appraisal Scope of Work Options for FHA Single Family Programs
Impacted By COVID-19,” FHA Mortgagee Letter 2020-05, March 27, 2020, https://www.hud.gov/sites/dfiles/
OCHCO/documents/20-05hsgml.pdf. T he flexibilities provided in each of these documents were subsequently
extended.
49 FHFA, “FHFA Announces that Enterprises will Purchase Qualified Loans in Forbearance to Keep Lending
Flowing,” press release, April 22, 2020, https://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Announces-that-
Enterprises-will-Purchase-Qualified-Loans.aspx; and FHA Mortgagee Letter 2020-16, “ Endorsement of Mortgages
under Forbearance for Borrowers Affected by the Presidentially -Declared COVID-19 National Emergency consistent
with the Coronavirus Aid, Relief, and Economic Security (CARES) Act,” https://www.hud.gov/sites/dfiles/OCHCO/
documents/2020-16hsngml.pdf. As of the date of this report, FHA’s policy is in effect through November 30, 2020, and
FHFA’s policy had been ext ended through October 31, 2020.
50 Ibid. Fannie Mae and Freddie Mac charge additional fees for purchasing mortgages in forbearance, while FHA
requires a lender to continue to bear some of the risk of such mortgages by signing a partial indemnification agree ment.
51 Letter from House Financial Services Committee Chairwoman Maxine Waters et al. to HUD Secretary Benjamin S.
Carson and FHFA Director Mark Calabria, June 25, 2020, https://financialservices.house.gov/uploadedfiles/
ltr_to_hud_and_fhfa_re_ef_6-25-20.pdf. Bills introduced in the House (H.R. 6794) and Senate (S. 4260) would
prohibit FHA and Fannie Mae and Freddie Mac from imposing additional costs or other terms on such mortgages
solely based on their forbearance status.
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servicers.52 In response, Ginnie Mae and Fannie Mae and Freddie Mac have each taken
certain steps to address potential servicer liquidity issues for mortgages that they back.53
In addition, the Federal Reserve has agreed to purchase mortgage-backed securities to help
provide liquidity and stability in the mortgage market.54 These purchases can facilitate the
funding of mortgages, even if investors’ demand for mortgage-backed securities declines during
the pandemic.
For more information, see the following:
 CRS Insight IN11334, Mortgage Provisions in the Coronavirus Aid, Relief, and
Economic Security (CARES) Act.
 CRS Insight IN11316, COVID-19: Support for Mortgage Lenders and Servicers.
 CRS Insight IN11385, The Impact of COVID-19-Related Forbearances on the
Federal Mortgage Finance System.
Increased Funding for Housing Programs
The CARES Act appropriated an additional $12.4 bil ion for HUD housing programs in FY2020.
These funds were directed to several HUD programs to provide additional resources to address
emerging housing needs caused by COVID-19, to help cover increased costs in rental assistance
programs, and for administrative capacity and oversight. The CARES Act also provides the HUD
Secretary broad waiver authority in most accounts to expedite or facilitate the use of these funds
to respond to the coronavirus.
The majority of the funds—about $9.4 bil ion—were for several HUD grant programs, many of
which provide relatively flexible funding to state and local governments or other entities for
eligible affordable housing, community development, or related activities. Because these
programs general y fund a range of al owable activities, they can be used to address a variety of
emerging needs related to the pandemic. The largest amounts were for the Community
Development Fund, the account that funds Community Development Block Grants (CDBG) ($5
bil ion), and Emergency Solutions Grants (ESG) ($4 bil ion). States and local governments can
use CDBG funds for a range of housing and community development activities, while ESG, one
of the Homeless Assistance Grants, can be used for a range of services for those who are
homeless or at risk of homelessness. The law also provided funds to grant programs that assist
tribes, fair housing programs, and the Housing Opportunities for Persons with AIDS (HOPWA)
program.
The CARES Act also provided about $3 bil ion to maintain existing rental assistance in several
HUD programs. HUD rental assistance programs subsidize the difference between tenant

52 For more information on mortgage servicing considerations, see CRS Insight IN11377, Mortgage Servicing Rights
and Selected Market Developm ents.
53 Ginnie Mae expanded access to the Pass T hrough Assistance Program (PT AP), through which Ginnie Mae lends
money to servicers to make required advances if they cannot obtain funding through other sources. FHFA announced
that Fannie Mae servicers would only be required to advance four months of principal and interest payments (this was
already t he policy for Freddie Mac servicers). See Ginnie Mae, “ Ginnie Mae Announces Changes to its Pass-T hrough
Assistance Program in Response to COVID-19 National Emergency,” press release, April 10, 2020,
https://ginniemae.gov/newsroom/Pages/PressReleaseDispPage.aspx?ParamID=196; and FHFA, “ FHFA Addresses
Servicer Liquidity Concerns, Announces Four Month Advance Obligation Limit for Loans in Forbearance,” press
release, April 21, 2020, https://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Addresses- Servicer-Liquidity-
Concerns-Announces-Four-Month-Advance-Obligation-Limit-for-Loans-in-Forbearance.aspx.
54 Board of Governors of the Federal Reserve System, “Federal Reserve Issues FOMC Statement,” March 23, 2020,
https://www.federalreserve.gov/newsevents/pressreleases/monetary20200323a.htm.
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contributions toward rent and a unit’s rent (or operating expenses). When tenants’ incomes are
reduced—such as by rising unemployment triggered by the pandemic—their rent contributions
decrease, which increases federal subsidy costs. The CARES Act provided supplemental funding
to help cover those anticipated increased costs in several HUD programs, inc luding the public
housing, Housing Choice Voucher, and project-based Section 8 programs.
The CARES Act also provided $50 mil ion for HUD administrative offices and $5 mil ion for the
HUD Office of the Inspector General for oversight of activities funded under the CARES Act.
For more information, see the following:
 CRS Insight IN11319, Funding for HUD in the CARES Act.
 CRS Insight IN11315, Community Development Block Grants and the CARES
Act.
 CRS Insight IN11277, Responding to the COVID-19 Pandemic with Community
Development Block Grant (CDBG) Authorities
Proposals for Additional Action
As the pandemic continues, there have been cal s for additional federal policy interventions.
Dozens of bil s have been introduced in Congress that would address various housing-related
issues caused by the pandemic.
Some cal s have been for additional assistance to renters and homeowners so they do not fal
behind on their payments and risk eviction or foreclosure, and possibly homelessness, when
moratoria or forbearance periods end. Such assistance could take various forms. Some have
proposed expansions or extensions of existing eviction or foreclosure moratoria or additional
protections related to CARES Act mortgage forbearance requirements. Others have proposed
other types of assistance, such as direct payments to help households make their rental or
mortgage payments for a period of time. For example, even before the national eviction
moratorium was announced, a broad coalition of low-income housing advocates, real estate
interests, and other stakeholders had come together to cal for emergency rental assistance.55
Some have also cal ed for additional assistance for other housing market participants that are
affected when renters or mortgage borrowers miss payments; namely, landlords and mortgage
servicers. (Proposals to assist households by providing direct financial assistance to help with rent
or mortgage payments would also benefit landlords and servicers, respectively, by reducing the
amount of missed payments.) In addition to experiencing a loss of income, which could be
particularly significant for landlords whose rental properties represent their primary source of
income, some landlords may have difficulty sustaining mortgage payments, operating costs, or
other expenses related to maintaining rental housing if tenants are unable to pay rent. Tenants
who work in industries at higher risk of job loss may be more likely to rent units in single-family
homes or smal multifamily properties, and many of the smal er landlords of these properties, in
particular, may struggle to withstand months without rental income.56 Some owners of rental

55 Letter from Aeon et al. to Congressional Leadership, May 4, 2020, https://nhc.org/wp-content/uploads/2020/05/
FinalHousingCoalitionERALetter2020-05-04.pdf.
56 For example, see Whitney Airgood-Obrycki and Alexander Hermann, “COVID-19 Rent Shortfalls in Small
Buildings,” Joint Center for Housing Studies of Harvard University, May 26, 2020, https://www.jchs.harvard.edu/blog/
covid-19-rent-shortfalls-in-small-buildings/; and Jung Hyun Choi and Caitlin Young, “ Owners and Renters of 6.2
Million Units in Small Buildings Are Particularly Vulnerable during the Pandemic,” Urban Institute Housing Finance
Policy Center, August 10, 2020, https://www.urban.org/urban-wire/owners-and-renters-62-million-units-small-
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properties were eligible for Smal Business Administration Economic Injury Disaster Loans as
authorized under the CARES Act,57 but there have been cal s for additional or more targeted
assistance. Similarly, while Ginnie Mae and FHFA have taken some administrative actions to
address concerns about mortgage servicer liquidity, some have cal ed for additional actions to
provide additional financial support for mortgage servicers.58
A variety of bil s introduced in Congress would address these or other pandemic-related housing
issues, and some have been considered. The Heroes Act (H.R. 6800), which the House passed in
May, includes several housing-related provisions in Division K. These include additional funding
for some existing housing programs as wel as for certain new programs to respond to pandemic -
related housing needs; extensions, expansions, and changes to the CARES Act eviction
moratorium, foreclosure moratorium, and mortgage forbearance provisions; and access to
financial support for landlords and mortgage servicers.59 These provisions were also included in a
standalone bil , the Emergency Housing Protections and Relief Act of 2020 (H.R. 7301), which
has also passed the House. The House passed a revised version of the Heroes Act (H.R. 925) on
October 1; the broad contours of the housing-related provisions in H.R. 925 are largely similar to
those in H.R. 6800, though there are some differences in the details and in the specific provisions
that are included.
For more information, see the following:
 CRS Report R46434, HEROES Act, Division K—COVID-19 Housing, Economic
Relief, and Oversight Act.
Other Housing Issues in the 116th Congress
Outside of the pandemic, a variety of other housing-related issues have been of interest during the
116th Congress, including issues related to housing finance, housing assistance programs,
administrative actions related to affordable housing, housing and disaster relief, and housing-
related tax provisions.
Housing Finance
Status of Fannie Mae and Freddie Mac
Fannie Mae and Freddie Mac are two government-sponsored enterprises (GSEs) chartered by
Congress to provide liquidity to the secondary markets for single-family and multifamily
residential mortgages. The GSEs purchase mortgages from loan originators, retain the credit
(default) risk from the mortgages they purchase, and subsequently issue mortgage-backed
securities (MBS). Investors who purchase the MBS are guaranteed to get their initial principal
investment returned, but they assume the risk that borrowers may choose to repay their mortgages

buildings-are-particularly-vulnerable-during-pandemic.
57 For more information on these loans, see https://www.sba.gov/funding-programs/loans/coronavirus-relief-options.
58 For example, see Karen Kaul and T ed T ozer, The Need for a Federal Liquidity Facility for Government Loan
Servicing, Urban Institute Housing Finance Policy Center, July 2020, https://www.urban.org/sites/default/files/
publication/102580/the-need-for-a-federal-liquidity-facility-for-government-loan-servicing_0.pdf.
59 T he Heroes Act, as passed by the House, would also continue the UI expansion and provide a second $1,200 relief
payment for most households. While not specific housing provisions, such assistance could potentially be used to
address housing-related needs.
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ahead of schedule (e.g., by refinancing or sel ing the home), known as prepayment risk.60 In short,
the GSEs’ securitization process detaches two mortgage risks into separate components.61 The
GSEs retain the default risk component for a fee and transfer the prepayment risk component to
MBS investors.
The Federal Housing Finance Agency (FHFA), an independent federal government agency
created by the Housing and Economic Recovery Act of 2008 (HERA; P.L. 110-289), regulates the
GSEs for prudential safety and soundness and ensures they meet their affordable housing mission
goals. In September 2008, the GSEs experienced losses that exceeded their statutory minimum
capital requirement levels due to the high rate of mortgage defaults. The GSEs also experienced
losses following spikes in short-term borrowing rates that occurred while they were funding long-
term assets held in their portfolios. The GSEs subsequently agreed to be placed under
conservatorship by FHFA, which now has the powers of management, boards, and shareholders.62
Since Fannie Mae and Freddie Mac entered conservatorship in 2008, policymakers have
expressed interest in comprehensive housing finance reform legislation that would resolve the
conservatorships of these GSEs and address the underlying issues that are perceived to have led
to their financial trouble and conservatorships. Previous Congresses have considered housing
finance reform legislation to varying degrees, but none has been enacted. Early in the 116th
Congress, Senate Committee on Banking, Housing, and Urban Affairs Chairman Mike Crapo
released an outline for potential housing finance reform legislation.63 The committee held
hearings on it shortly thereafter.64
In March 2019, President Trump issued a Memorandum on Federal Housing Finance Reform
directing the Treasury and HUD secretaries to develop plans to achieve certain housing finance
reform goals, including both legislative and administrative reforms.65 Treasury and HUD released
these plans on September 5, 2019.66 Both plans include a variety of legislative recommendations,
as wel as recommendations for steps that the agencies could take administratively in the absence

60 Prepayment risk is one type of the broader category of risks linked to changes in interest rates. Following interest
rates changes, the market value of a loan (or bond) asset can change; for assets that give borrowers the option to prepay
their loans ahead of schedule, the prepayment risk may offset market value changes. On the liability side, interest rate
changes affect the lenders’ costs to borrow funds used to finance assets held in their portfolios. Hence, lenders can take
advantage of the GSEs’ securitization process to reduce the various interest rate risks associated with holding highly
interest -sensitive assets such as 30-year fixed rate mortgages.
61 For more on default and prepayment risk, see CRS In Focus IF10993, Consumer Credit Markets and Loan Pricing:
The Basics.
62 For more background on the conservatorship of Fannie Mae and Freddie Mac, see CRS Report R44525, Fannie Mae
and Freddie Mac in Conservatorship: Frequently Asked Questions; and FHFA, “ Conservatorship,” at
https://www.fhfa.gov/Conservatorship.
63 U.S. Congress, Senate Committee on Banking, Housing, and Urban Affairs, “Chairman Crapo Releases Outline for
Housing Finance Reform,” press release, February 1, 2019, https://www.banking.senate.gov/newsroom/majority/
chairman-crapo-releases-outline-for-housing-finance-reform.
64 U.S. Congress, Senate Committee on Banking, Housing, and Urban Affairs, Chairman’s Housing Reform Outline:
Part 1, 116th Cong., 1st sess., March 26, 2019; and U.S. Congress, Senate Committee on Banking, Housing, and Urban
Affairs, Chairm an’s Housing Reform Outline: Part 2 , 116th Cong., 1st sess., March 27, 2019.
65 Presidential Memorandum, Memorandum on Federal Housing Finance Reform , March 27, 2019,
https://www.whitehouse.gov/presidential-actions/memorandum-federal-housing-finance-reform/.
66 Department of the Treasury, Housing Reform Plan Pursuant to the Presidential Memorandum Issued March 27,
2019, September 2019, https://home.treasury.gov/system/files/136/Treasury-Housing-Finance-Reform-Plan.pdf; and
Department of Housing and Urban Development, Housing Finance Reform Plan Pursuant to the Presidential
Mem orandum Issued March 27, 2019, September 2019, https://home.treasury.gov/system/files/136/HUD-Housing-
Finance-Reform-Plan-September-2019.pdf.
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of legislation. The Senate Banking Committee and the House Financial Services Committee each
held a hearing on the plans.67
Outside of any legislative efforts related to housing finance reform, FHFA has taken a variety of
administrative and regulatory actions related to Fannie Mae and Freddie Mac in its dual roles as
their regulator and conservator.
Status of FHFA Administrative Requirements for GSEs While Under
Conservatorship
Since conservatorship, the FHFA has focused on initiatives to standardize many aspects of the
GSEs’ operations, which include their mortgage data collection processes, securitization
processes, mortgage servicing policies (e.g., resolving delinquencies), and MBS issuances. Such
standardization arguably increases transparency, reduces the length of the single-family mortgage
origination and securitization processes, and ultimately increases the liquidity and uniform
pricing of the GSEs’ issued securities.68 These efforts have resulted in the GSEs issuing two types
of securities to facilitate lending in the single-family mortgage market. The GSEs continue to
transfer prepayment risks but via a new financial instrument (the uniform mortgage-backed
security); and they now transfer default risks (credit risk transfers, CRT) to private investors.
Uniform Mortgage-Backed Security
The FHFA, under the single security initiative, directed the GSEs to align their key contractual
and business practices by acquiring mortgages with similar prepayment speeds along with other
features.69 Each GSE continues to separately purchase conforming mortgages and guarantee the
credit risks linked to the MBS trusts it creates. The prepayment speeds, however, are now
required to align such that they do not diverge by more than 2% over a three-month interval.70
With similar prepayment characteristics, Fannie Mae’s and Freddie Mac’s MBS trusts would
generate similar cash-flow predictability and prepayment speeds and, therefore, facilitate the
creation of uniform securities. Rather than separate MBS issuances, the FHFA directed the GSEs
to issue one common security—the uniform mortgage-backed security (UMBS). However, the
GSEs would continue to separately issue and guarantee MBS that do not meet the standardization
requirements for UMBS.

67 U.S. Congress, Senate Committee on Banking, Housing, and Urban Affairs, Housing Finance Reform: Next Steps,
116th Cong., 1st sess., September 10, 2019; and U.S. Congress, House Committee on Financial Services, The End of
Affordable Housing? A Review of the Trump Administration’s Plans to Change Housing Finance in America , 116th
Cong., 1st sess., October 22, 2019.
68 For more information on the mortgage servicing and loss mitigation initiatives, see FHFA, “Mortgage Servicing,” at
https://www.fhfa.gov/PolicyProgramsResearch/Policy/Pages/Mortgage-Servicing.aspx; and Karan Kaul et al., The
Case for Uniform Mortgage Servicing Data Standards, Urban Institute, November 2018, at https://www.urban.org/
sites/default/files/publication/99317/uniform_mortgage_servicing_data_standards_0.pdf. T he standardization of
servicing may enhance the attractiveness of CRT investments by clarifying the procedures for handling nonp erforming
mortgages, thus clarifying how losses will be distributed among the various tranche classes. For more information, see
Basel Committee on Banking Supervision: T he Joint Forum, Report on Asset Securitisation Incentives, July 2011, at
https://www.bis.org/publ/joint26.pdf; and Patricia A. McCoy, Barriers to Federal Hom e Mortgage Modification Efforts
During the Financial Crisis, Joint Center for Housing Studies: Harvard University, August 2010, at
https://www.jchs.harvard.edu/sites/default/files/mf10-6.pdf.
69 See FHFA, “Uniform Mortgage-Backed Security,” 84 Federal Register 7793-7801, March 5, 2019.
70 See FHFA, “Uniform Mortgage-Backed Security,” 84 Federal Register 7793-7801, March 5, 2019.
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The issuance of UMBS began on June 3, 2019.71 The combined market for the GSEs’ MBS
issuances is expected to be more liquid because the UMBSs trade at a single price (rather than at
two different prices).72 FHFA monitors the GSEs to ensure that their underwriting policies remain
intact to avoid material misalignment that compromises interchangeability of the underlying
mortgages used to create UMBS.73
Credit Risk Transfer
In July 2013, the GSEs initiated new CRT programs to share with the private sector a portion of
the default risk linked to their guaranteed single-family mortgages held in the MBS trusts.74
Investors preferring exposure only to mortgage prepayment risk may continue to purchase MBSs;
however, the private sector may now purchase CRT issuances, which function similarly to MBSs,
to earn revenue in exchange for assuming exposure to the credit risk.75 The GSEs typical y
transfer to CRT investors some of the credit risk linked to mortgages with loan-to-values (LTVs)
greater than 60% (or borrowers with 40% or less in accumulated home equity, meaning that they
are more vulnerable to the possibility of owing more than the value of their homes if housing
prices were to fal ).76 When defaults occur, the GSEs reduce the returns paid to CRT investors
(similar to reducing the returns to MBSs investors after prepayments occur). Conversely, the
GSEs retain the credit risk for mortgages with lower LTVs (or borrowers with 41% or more in
accumulated home equity such that their outstanding balances are significantly below the value of
their residential properties), which are less likely to default.77 From 2013 to 2019, the GSEs have
transferred a total of $3.479 tril ion of credit risk to private investors.78

71 See FHFA, “Statement of FHFA Deputy Director Robert Fishman on the Launch of the New Uniform Mortgage -
Backed Security (UMBS),” press release, June 3, 2019, at https://www.fhfa.gov/Media/PublicAffairs/Pages/Statement-
of-FHFA-Deputy-Director-Robert-Fishman-on-the-launch-of-the-new-Uniform-Mortgage-Backed-Security.aspx.
72 FHFA, An Update on the Structure of the Single Security, May 15, 2015, p. 4, at https://www.fhfa.gov/AboutUs/
Reports/ReportDocuments/Single%20Security%20Update%20final.pdf. For a discussion of the pricing differential that
existed between Fannie Mae’s and Freddie Mac’s MBSs, see CRS Report R45828, Overview of Recent Administrative
Reform s of Fannie Mae and Freddie Mac; and Laurie Goodman, The $400 Million Case for a Single GSE Security,
Urban Institute, September 5, 2014, at http://www.urban.org/urban-wire/400-million-case-single-gse-security. For a
discussion on the effects of standardization in the mortgage and MBS markets, see Adam J. Levit in and Susan M.
Wachter, “Explaining the Housing Bubble,” The Georgetown Law Journal, vol. 100, no. 4 (April 12, 2012), pp. 1177-
1258.
73 For more information, see CRS Report R45828, Overview of Recent Administrative Reforms of Fannie Mae and
Freddie Mac.
74 T he GSEs had existing programs to redistribute more than 90% of the credit risk on their multi-family programs.
Fannie Mae issues instruments linked to credit risk stemming from its multi-family mortgages through its Delegated
Underwriting and Servicing Program (DUS); the corresponding Freddie Mac instruments are known as K -Deals. See
U.S. Government Accountability Office (GAO), Financial Audit: Federal Housing Finance Agency’s Fiscal Years
2018 and 2017 Financial Statements, GAO-19-183R, November 15, 2018, at https://www.gao.gov/assets/700/
695479.pdf; and FHFA, Overview of Fannie Mae and Freddie Mac Credit Risk Transfer Transactions, August 2015, at
https://www.fhfa.gov/aboutus/reports/reportdocuments/crt-overview-8-21-2015.pdf.
75 Fannie Mae’s CRT instruments are known as Connecticut Avenue Securities (CAS); Freddie Mac’s CRT instruments
are known as Structural Agency Credit Risk (ST ACR).
76 See FHFA, Performance and Accountability Report, FY2018, at https://www.fhfa.gov/AboutUs/Reports/
ReportDocuments/FHFA-2018-PAR.pdf.
77 T he GSEs may also transfer the credit risk of mortgages retained in their portfolios (typically because they lack the
standardized features that would make them eligible for placement into an MBS trust for securitization).
78 For more information, see FHFA, “Credit Risk T ransfer Progress Report,” Fourth Quarter 2019, at
https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/CRT -Progress-Report -4Q2019.pdf.
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Proposed Capital Rule
Although the exact definition of capital for financial firms is determined by law and regulation, it
general y refers to common or preferred equity (as a percentage of assets), which can absorb
financial losses. The FHFA suspended the GSEs’ capital requirements during conservatorship,
and they must pay dividends only to Treasury (as opposed to private shareholders) while they are
under conservatorship. As a prerequisite for exiting conservatorship, the GSEs must increase their
holdings of capital reserves.79 Given that pre-conservatorship capital levels for the GSEs were not
sufficient to avoid conservatorship, HERA gave FHFA the authority to increase capital standards
above the statutory minimum as necessary.80
On May 20, 2020, FHFA released a proposed rule that would establish a new regulatory capital
framework for Fannie Mae and Freddie Mac to be in place once they are returned to stockholder
control.81 The proposed framework borrows concepts from the capital regulatory framework for
large banks such as the definition of capital, various capital buffers, and a risk weight capital floor
that would be applied for any CRT exposures retained in portfolio.82 Comments on the proposal
were due by August 31, 2020.
Multifamily Housing Financing Activities
Multifamily properties are general y defined as properties that include five or more housing units.
FHFA has placed various directives on the GSEs’ multifamily programs since conservatorship.83
Namely, in 2014, it placed annual caps on the overal dollar volume of multifamily mortgages
that each GSE can purchase to shrink their multifamily operations and resulting risks to
taxpayers.84 It excluded mission-driven purchases from counting toward the cap to encourage
GSE support in the affordable housing and underserved market segments.85 Beginning in 2016,
FHFA also excluded loans that would finance certain energy and water efficiency improvements
(i.e., green loans) from the multifamily purchase caps to retain focus on mission goals.
On September 13, 2019, FHFA revised its directive regarding the multifamily purchase caps,
increasing them from the previous caps of $35 bil ion each to $100 bil ion each for Fannie Mae
and Freddie Mac. Al multifamily mortgage purchases wil now count toward the cap—no
exemptions or exclusions for mission-driven or green loans. 86 However, 37.5% of the GSEs’ loan

79 P.L. 102-550, the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, establishes the statutory
minimum leverage (unweighted) capital requirement; P.L. 110-289, the Housing Economic and Recovery Act of 2008,
gave FHFA the authority to increase capital standards above the statutory minimum as necessary.
80 T he statutory minimum leverage (unweighted) capital requirement, specified in P.L. 102-550, the Federal Housing
Enterprises Safety and Soundness Act of 1992, is equal to 2.5% of on -balance sheet (portfolio) assets and 0.45% of off-
balance sheet (MBS trust) obligations.
81 See FHFA, “FHFA Releases Re-Proposed Capital Rule for the Enterprises,” May 20, 2020, at https://www.fhfa.gov/
Media/PublicAffairs/Pages/FHFA-Releases-Re-Proposed-Capital-Rule-for-the-Enterprises.aspx.
82 See FHFA, “Enterprise Regulatory Capital Framework,” 85 Federal Register 39274-39406, June 30, 2020.
83 For more information, see CRS Report R46480, Multifamily Housing Finance and Selected Policy Issues.
84 See FHFA, “FHFA Seeks Public Input on Reducing Fannie Mae and Freddie Mac Multifamily Businesses,” press
release, August 9, 2013, at https://www.fhfa.gov/Media/PublicAffairs/PublicAffairsDocuments/
MultifamilyInput080913Final.pdf; and FHFA, Conservatorship Strategic Plan: Perform ance Goals for 2013 , at
https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2013EnterpriseScorecard_508.pdf.
85 See FHFA, “Fact Sheet: New Multifamily Caps for Fannie Mae and Freddie Mac,” press release, at
https://www.fhfa.gov/Media/PublicAffairs/PublicAffairsDocuments/newmultifamilycaps-9132019.pdf.
86 See FHFA, “FHFA Revises Multifamily Loan Purchase Caps for Fannie Mae and Freddie Mac,” press release,
September 13, 2019, at https://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Revises-Multifamily-Loan-Purchase-
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purchases must be mission driven. The FHFA Director stated that this revision narrows the scope
of the GSEs’ multifamily programs to maintain the focus on affordable rental units for low- and
moderate-income households and other historical y underserved renters.87
CFPB’s Proposed Changes to the Qualified Mortgage Rule and the GSE Patch
The Dodd-Frank Wal Street Reform and Consumer Protection Act (Dodd-Frank Act; P.L. 111-
203) requires lenders to make a good faith effort to ensure that certain mortgage borrowers have
the ability to repay the loans they offer. Lenders that are found to violate the requirement can be
required to pay monetary damages.88 On January 10, 2013, the Consumer Financial Protection
Bureau (CFPB) released a final rule implementing these ability-to-repay (ATR) requirements; the
rule took effect on January 10, 2014.89
The final rule provides multiple ways for a loan originator to comply with the ATR
requirements,90 one of which is by originating a qualified mortgage (QM). QMs are mortgages
that meet certain underwriting standards and lack various risky product-features. When a lender
issues a QM, it creates a presumption that the lender has complied with its ATR responsibilities,
reducing the lender’s legal exposure. The level of protection afforded a lender varies according to
the loan’s pricing.91 QMs with annual percentage rates (APRs) not exceeding the Average Prime
Offer Rate (APOR) by more than 1.5 percentage points qualify for safe harbor status. QMs with
APRs exceeding the APOR by more than that amount are considered higher-priced QMs and
benefit from a rebuttable presumption of compliance. The CFPB has explained these legal
protections in this way:
Under a safe harbor, if a court finds that a mortgage you originated was a QM, then that finding
conclusively establishes that you complied with the ATR requirements when you originated the
mortgage. ... Under a rebuttable presumption, if a court finds that a mortgage you originated was a
higher-priced QM, a consumer can argue that you violated the ATR rule. However, to prevail on
that argument, the consumer must show that based on the information available to you at the time
the mortgage was made, the consumer did not have enough residual income left to meet living
expenses after paying their mortgage and other debts.92
Lenders may be less likely to originate non-QM loans due to the increased legal exposure.
Limiting the borrower’s debt-to-income (DTI) ratio to 43% is one of the current underwriting
requirements for a loan to receive general QM status. Mortgages with DTIs exceeding 43% may
stil qualify as QMs if (1) they are eligible to be insured or guaranteed by FHA, USDA, or VA and
meet permanent QM standards established by each of those agencies,93 or (2) they are eligible for

Caps-for-Fannie-Mae-and-Freddie-Mac.aspx.
87 See FHFA, “FHFA Revises Multifamily Loan Purchase Caps for Fannie Mae and Freddie Mac,” press release,
September 13, 2019, at https://www.fhfa.gov/mobile/Pages/public-affairs-detail.aspx?PageName=FHFA-Revises-
Multifamily-Loan-Purchase-Caps-for-Fannie-Mae-and-Freddie-Mac.aspx.
88 15 U.S.C. §1640
89 See Bureau of Consumer Financial Protection (CFPB), “Ability -to-repay and Qualified Mortgage Standards Under
the T ruth in Lending Act (Regulation Z),” 78 Federal Register 6408-6620, January 30, 2013.
90 For a comparison of the different ways the lenders can comply with the AT R requirements, see
https://files.consumerfinance.gov/f/documents/201603_cfpb_atr-and-qm-comparison-chart.pdf.
91 All QM loans must meet certain underwriting and product feature requirements.
92 CFPB, Ability-to-Repay and Qualified Mortgage Rule Small Entity Compliance Guide, March 2016, pp. 33-34,
https://files.consumerfinance.gov/f/documents/bcfp__atr-qm_small-entity_compliance-guide.pdf.
93 T he Dodd-Frank Act allowed federal agencies that guarantee mortgages to issue their own definitions of a QM. T he
Federal Housing Administration, U.S. Department of Veterans Affairs, and United States Department of Agriculture
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purchase by two government sponsored enterprises (GSEs), Fannie Mae or Freddie Mac.94 The
GSE QM option, which is referred to as the QM patch, al ows the GSEs to operate under their
own QM rules for seven years (until January 10, 2021) or until they exit conservatorship,
whichever is sooner.95
On June 22, 2020, the CFPB proposed revisions to the current QM definition.96 Some of the
proposed revisions include the following:97
 For the QM definition, the proposal would remove the 43% DTI ratio requirement and
replace it with requirements that are based on the mortgage pricing, which reflects the
credit quality of borrowers. The rule would continue to grant safe harbor QM status to a
first-lien (primary) mortgage in which the difference between its APR and the APOR is
less than 1.5 percentage points.98 To qualify as a QM with rebuttable presumption,
however, the proposal would limit the difference between the APR and APOR for first-
lien mortgages to no more than 2 percentage points.99
 The CFPB also seeks comments on removing Appendix Q, which creditors are currently
required to use to verify borrower debt and income for QMs, and granting safe harbor to
creditors that use specified income and debt verification standards such as one or more of
the following: Fannie Mae’s Single Family Sel ing Guide, Freddie Mac’s Single-Family
Sel er/Servicer Guide, FHA’s Single Family Housing Policy Handbook, the Veteran
Administrations Lenders Handbook, and the Field Office Handbook for the Direct Single
Family Housing Program and Handbook for the Single Family Guaranteed Loan Program
of the U.S. Department of Agriculture (USDA).

did not adopt a 43% DT I requirement for the mortgages they guarantee. Instead, these agencies adopted their own QM
definitions, which included the exclusion of product features they considered would impede repayment from borrowers
they predominantly serve—but they did not limit DT Is to 43%. See Department of Housing and Urban Development,
“Qualified Mortgage Definition for HUD Insured and Guaranteed Single Family Mortgages,” 78 Federal Register
75215-75238, December 13, 2013; Department of Veterans Affairs, “ Loan Guaranty: Ability -T o-Repay Standards and
Qualified Mortgage Definition Under the T ruth in Lending Act,” 79 Federal Register 26620-26628, May 9, 2014; and
Department of Agriculture, Rural Housing Service, “Single Family Housing Guaranteed Loan Program,” 81 Federal
Register 26461-26465, May 3, 2016.
94 See CFPB, Ability-to-Repay and Qualified Mortgage Rule Assessment Report, January 2019, at
https://files.consumerfinance.gov/f/documents/cfpb_ability-to-repay-qualified-mortgage_assessment -report.pdf.
95 See CFPB, “Ability-to-Repay and Qualified Mortgage Standards Under the T ruth in Lending Act (Regulation Z),” 78
Federal Register 6049, January 30, 2013; Bing Bai, Laurie Goodman, and Ellen Seidman, Has the QM Rule Made It
Harder to Get a Mortgage?, Urban Institute, March 2016, at https://www.urban.org/sites/default/files/publication/
78266/2000640-Has-the-QM-Rule-Made-It-Harder-to-Get-a-Mortgage.pdf; and Karan Kaul and Laurie Goodman,
What, If Anything, Should Replace the QM GSE Patch? , Urban Institute, August 2018, at https://www.urban.org/sites/
default/files/publication/98949/2018_10_30_qualified_mortgage_rule_finalizedv2_0.pdf.
96 See CFPB, “Qualified Mortgage Definition Under the T ruth in Lending Act (Regulation Z): General QM Loan
Definition,” 85 Federal Register 41716-41778, July 10, 2020.
97 For a summary of the proposal, see CFPB, Summary of Proposed Rule-Makings: June 2020 Proposals to Amend the
ATR-QM Rule, June 22, 2020, at https://files.consumerfinance.gov/f/documents/cfpb_atr-qm_summary-of-
proposals_2020-06.pdf.
98 Consistent with the current rule, the CFPB proposes higher thresholds for loans with smaller loan amounts and for
subordinate-lien transactions, which typically have higher APRs. For more information on how the CFPB defines the
benchmark APOR, see, CFPB, “ What is a ‘Higher-Priced Mortgage Loan?’”, September 17, 2013, at
https://www.consumerfinance.gov/ask-cfpb/what -is-a-higher-priced-mortgage-loan-en-1797/.
99 Under the current rule, there is no limit on the amount by which the APR exceeds the APOR for the purposes of the
QM definition, though only QMs where the difference is no more than 1.5 percentage points (for most first -lien
mortgages) qualify for a safe harbor.
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 The CFPB is also seeking comments on an alternative proposal to consider a DTI range
between 45% and 48% rather than removing the DTI requirement entirely. Higher credit-
quality applicants likely to qualify for lower mortgage rates could be approved with DTIs
near or at the upper end of the range. In this case, a better credit score may act as a
compensating factor, a positive risk attribute that may be given additional weight when
underwriting applicants with higher DTIs.
On June 22, 2020, in a separate proposed rule, the CFPB also proposed revisions to the current
GSE/QM patch.100 Specifical y, the CFPB proposes to extend the sunset date for the GSE Patch
such that it corresponds to the earlier of either (1) the effective date of the final amendments to
the QM rule revisions or (2) the date that the GSEs exit conservatorship. (The CFPB notes that
the QM rule revisions are not expected to become effective prior to April 1, 2021.)
Department of Veterans Affairs Loan Guaranty and Maximum Loan Amounts
The Department of Veterans Affairs (VA) insures home loans to veterans as part of the VA Loan
Guaranty program. To date, the maximum amount a veteran can borrow has been limited by the
Freddie Mac conforming loan limit.101 While veterans can enter into loans that exceed the
conforming loan limit, they cannot do so without making a down payment. The fact that VA loans
do not ordinarily require a down payment is a popular feature of the program—in FY2018, nearly
80% of loans did not have a down payment.102
Congress removed the conforming loan limit for VA loans entered into on or after January 1,
2020, as part of the Blue Water Navy Vietnam Veterans Act of 2019 (P.L. 116-23). After the
change takes effect, most veterans wil be able to enter into loans of any amount, subject to
eligibility, without the need for a down payment. An exception exists for veterans who have
outstanding VA loans; they will stil be subject to Freddie Mac conforming loan limits.
Housing Assistance
Appropriations for Housing Programs
For several years, concern in Congress about federal budget deficits led to increased interest in
reducing the amount of discretionary funding provided each year through the annual
appropriations process. This interest manifested most prominently in the enactment of the Budget
Control Act of 2011 (P.L. 112-25), which set enforceable limits for both mandatory and
discretionary spending.103 The limits on discretionary spending, which have been amended and
adjusted since they were first enacted,104 have implications for HUD’s budget, the largest source
of funding for direct housing assistance, because it is made up almost entirely of discretionary

100 See CFPB, “Qualified Mortgage Definition Under the T ruth in Lending Act (Regulation Z): Extension of Sunset
Date,” 85 Federal Register 41448-41463, July 10, 2020.
101 In 2019, the conforming loan limit for most areas of the country was $484,350. Ho wever, in certain high-cost areas
the conforming loan limit may be as high as 115% of the area median home price, but not to exceed 150% of the
conforming loan limit. As a result, in some high-cost areas the 2019 limit is as high as $726,525. (For more inf ormation
on the conforming loan limit, see CRS Report R44826, The Loan Lim its for Governm ent-Backed Mortgages.)
102 U.S. Department of Veterans Affairs, FY2018 Annual Benefits Report, Home Loan Guaranty section, p. 8,
https://www.benefits.va.gov/REPORT S/abr/docs/2018-loan-guaranty.pdf.
103 For more information, see CRS Report R44874, The Budget Control Act: Frequently Asked Questions.
104 Ibid.
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appropriations.105 In FY2020, the discretionary spending limits were slated to decrease, after
having been increased in FY2018 and FY2019 by the Bipartisan Budget Act of FY2018 (BBA;
P.L. 115-123), but they were raised again for FY2020 and FY2021 by the Bipartisan Budget Act
of 2019 (P.L. 116-37).106
More than three-quarters of HUD’s appropriations are devoted to three rental assistance programs
serving more than 4 mil ion families: the Section 8 Housing Choice Voucher (HCV) program,
Section 8 project-based rental assistance, and the public housing program. Funding for the HCV
program and project-based rental assistance has been increasing in recent years, largely because
of the increased costs of maintaining assistance for households that are currently served by the
programs.107 Public housing has, arguably, been underfunded (based on studies undertaken by
HUD of what it should cost to operate and maintain it) for many years.108 Despite the large share
of total HUD funding these rental assistance programs command, their combined funding levels
only permit them to serve an estimated one in four eligible families, which creates long waiting
lists for assistance in most communities.109 A similar dynamic plays out in the U.S. Department of
Agriculture’s Rural Housing Service budget. Demand for housing assistance exceeds the supply
of subsidies, yet the vast majority of the RHS budget is devoted to maintaining assistance for
current residents.110
In a budget environment with limits on discretionary spending, pressure to provide increased
funding to maintain current services for existing rental assistance programs competes with
pressure from states, localities, and advocates to maintain or increase funding for other popular
programs, such as HUD’s Community Development Block Grant (CDBG) program, grants for
homelessness assistance, and funding for Native American housing.
FY2021 Budget
The Trump Administration’s budget request for FY2021 proposed a 15% decrease in new
appropriations for HUD’s programs and activities as compared to the prior year.111 As in prior
budget requests, it proposed to eliminate funding for several programs, including multiple HUD

105 Funding levels for HUD are determined by the T ransportation, HUD, and Related Agencies (T HUD) Appropriations
Subcommittee, generally in a bill by the same name. While HUD’s budget is generally smaller than the Department of
T ransportation’s, it makes up the largest share of the discretionary funding in the T HUD appropriations bill each year
because the majority of DOT ’s budget is made up of mandatory funding.
106 For more information, see CRS Insight IN11148, The Bipartisan Budget Act of 2019: Changes to the BCA and Debt
Lim it.
107 For the Section 8 HCV program, funding has been increasing in p art because Congress has created more vouchers
each year over the past several years (largely to replace units lost to the affordable housing stock in other assisted
housing programs or to provide targeted assistance for homeless veterans), and in part bec ause the cost of renewing
individual vouchers has been rising as gaps between low-income tenants’ incomes and rents in the market have been
growing. For the Section 8 project -based program, the increased funding is due to more long-term rental assistance
contracts on older properties expiring and being renewed, requiring new appropriations, as well as rent inflation.
108 For example, see Meryl Finkel et al., “Capital Needs in the Public Housing Program: Revised Final Report,”
prepared for the Department of Housing and Urban Development, November 24, 2010, http://portal.hud.gov/hudportal/
documents/huddoc?id=PH_Capital_Needs.pdf.
109 See Figure 6 of Joint Center for Housing Studies of Harvard University, America’s Rental Housing, 2017, p. 6,
http://www.jchs.harvard.edu//research-areas/reports/americas-rental-housing-2017.
110 T he bulk of the RHS budget for rental housing is devoted to renewing existing Section 521 rental assistance
contracts in Section 515 and Section 514/516 rental housing properties. For more information about USDA’s rural
housing programs, see CRS Report RL31837, An Overview of USDA Rural Developm ent Program s.
111 For more information, see CRS Report R46465, Transportation, Housing and Urban Development, and Related
Agencies (THUD) Appropriations for FY2021: In Brief.
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grant programs (CDBG, the HOME Investment Partnerships Program, the Self-Help and Assisted
Homeownership Opportunity Program (SHOP), and the public housing Capital Fund), and to
decrease funding for most other HUD programs. In proposing to eliminate the grant programs, the
Administration cited budget constraints and proposed that state and local governments take on
more of a role in the housing and community development activities funded by these programs.
Additional y, the budget referenced policy changes designed to reduce the cost of federal rental
assistance programs, including the Making Affordable Housing Work Act of 2018 (MAHWA)
legislative proposal, released by HUD in April 2018.112 If enacted, the proposal would make a
number of changes to the way tenant rents are calculated in HUD rental assistance programs,
resulting in rent increases for assisted housing recipients, and corresponding decreases in the cost
of federal subsidies. Further, it would permit local program administrators or property owners to
institute work requirements for recipients. In announcing the proposal, HUD described it as
setting the programs on “a more fiscal y sustainable path,” creating administrative efficiency, and
promoting self-sufficiency.113 Low-income housing advocates were critical of it, particularly the
effect increased rent payments may have on families.114 Thus far, it has not been considered in
Congress.
Beyond HUD, the Administration’s FY2021 budget request for USDA’s Rural Housing Service
proposed to eliminate funding for most rural housing programs, except for several loan guarantee
programs. It would continue to provide funding to renew existing rental assistance, but also
proposes a new minimum rent policy for tenants designed to help reduce federal subsidy costs.
The funding cuts proposed in the President’s FY2021 budget requests have been included in prior
Trump Administration budget requests, but not adopted by Congress.
For more on HUD appropriations trends in general, see CRS Report R42542, Department of
Housing and Urban Development (HUD): Funding Trends Since FY2002. For more on the
FY2021 process, see CRS Report R46465, Transportation, Housing and Urban Development,
and Related Agencies (THUD) Appropriations for FY2021: In Brief.
Housing Vouchers for Foster Youth
Policymakers have raised concerns that youth aging out of foster care lack adequate and
affordable housing as they transition to adulthood. A recent national study of young people
experiencing homelessness found that one-quarter to one-third had a history of having been in
foster care.115 In light of this, both the Administration and Congress have either made or proposed
changes to increase access to housing assistance for foster youth.

112 HUD, “Secretary Carson Proposes Rent Reform: Reforms to make current rent policies simpler, more transparent
and predictable,” press release, April 25, 2018 https://www.hud.gov/press/press_releases_media_advisories/
HUD_No_18_033.
113 HUD, “Secretary Carson Proposes Rent Reform: Reforms to make current rent policies simpler, more transparent
and predictable,” press release, April 25, 2018 https://www.hud.gov/press/press_releases_media_advisories/
HUD_No_18_033.
114 For example, see National Low Income Housing Coalition, “Affordable Housing Advocates T ell HUD and
Congress – Keep Housing Affordable for Low Income Families,” press release, April 25, 2018, http://nlihc.org/press/
releases/10642.
115 University of Chicago, Chapin Hall, Voices of Youth Count, Missed Opportunities: Pathways from Foster Care to
Youth Homelessness in America, July 2019, https://voicesofyouthcount.org/wp-content/uploads/2019/04/Chapin-
Hall_VoYC_Child-Welfare-Brief_2019-1.pdf
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Under current law, HUD’s Family Unification Program (FUP) offers a limited number of
vouchers plus services to (1) child welfare involved families for whom lack of stable housing is a
risk for family separation or a primary barrier to reunification and (2) youth aging out of foster
care and at risk of homelessness. FUP vouchers for youth are unique, in that they are limited to up
to 36 months, unlike other vouchers that are not subject to a time limit. Although foster youth are
one of the target populations for FUP, according to HUD, only 5% of FUP vouchers are used for
youth.116
In July 2019, HUD announced a new Administration initiative cal ed Foster Youth to
Independence (FYI). Under FYI, HUD makes additional vouchers, through the tenant protection
set-aside in the Housing Choice Voucher Program, available to serve youth in a program modeled
after FUP.
In Congress, the House passed via voice vote the Fostering Stable Housing Opportunities Act
(FSHO; H.R. 4300). The bil would provide explicit statutory authority to use tenant protection
vouchers for foster youth consistent with the FUP program and the new FYI initiative, and would
al ow for those vouchers to be extended beyond the typical 36-month time limit for youth when a
youth is engaged in employment, education, or training activities (or is otherwise exempt from
compliance), among other provisions. A companion bil has been introduced in the Senate (S.
2803).117
Implementation of Housing Assistance Legislation
Several pieces of assisted housing legislation that were enacted in prior Congresses have been in
the process of being implemented during the 116th Congress.
Moving to Work (MTW) Expansion
In the FY2016 HUD appropriations law, Congress mandated that HUD expand the Moving to
Work (MTW) demonstration by 100 public housing authorities (PHAs).118 MTW is a waiver
program that al ows a limited number of participating PHAs to receive exceptions from HUD for
most of the rules and regulations governing the public housing and voucher programs. MTW has
been controversial for many years, with PHAs supporting the flexibility it provides (e.g., al owing
PHAs to move funding between programs), and low-income housing advocates criticizing some
of the policies being adopted by PHAs (e.g., work requirements and time limits). Most recently,
the Government Accountability Office (GAO) issued a report raising concerns about HUD’s
oversight of MTW, including the lack of monitoring of the effects of policy changes under MTW
on tenants.119
HUD was required to phase in the FY2016 expansion and evaluate any new policies adopted by
participating PHAs. Following a series of listening sessions and advisory committee meetings,
and several solicitations for comment, HUD issued a solicitation of interest for the first two

116 See HUD Notice PIH 2019-20(HA), Tenant Protection Vouchers for Foster Youth to Independence Initiative, July
26, 2019, https://www.hud.gov/sites/dfiles/PIH/documents/PIH-2019-20.pdf
117 T he bill was discussed during a Senate Banking Committee hearing on November 7, 2019, entitled “Examining
Bipartisan Bills to Promote Affordable Housing Access and Safety.”
118 See Section 239, T itle II, Division L of P.L. 114-113.
119 U.S. Government Accountability Office, Rental Housing: Improvements Needed to Better Monitor the Moving to
Work Dem onstration, Including Effects on Tenants, GAO-18-150, January 25, 2018, https://www.gao.gov/products/
GAO-18-150.
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expansion cohorts in December 2018. As of the date of this report, no selections had yet been
made for those cohorts.120
Rental Assistance Demonstration Expansion
The Rental Assistance Demonstration (RAD) was an Obama Administration initiative initial y
designed to test the feasibility of addressing the estimated $25.6 bil ion backlog in unmet capital
needs in the public housing program121 by al owing local PHAs to convert their public housing
properties to either Section 8 Housing Choice Vouchers or Section 8 project-based rental
assistance.122 PHAs are limited in their ability to mortgage, and thus raise private capital for, their
public housing properties because of a federal deed restriction placed on the properties as a
condition of federal assistance. When public housing properties are converted under RAD, that
deed restriction is removed.123 As currently authorized, RAD conversions must be cost-neutral,
meaning that the Section 8 rents the converted properties may receive must not result in higher
subsidies than would have been received under the public housing program. Given this
restriction, and without additional subsidy, not al public housing properties can use a conversion
to raise private capital, potential y limiting the usefulness of a conversion for some properties.124
While RAD conversions have been popular with PHAs,125 and HUD’s initial evaluations of the
program have been favorable,126 a recent GAO study has raised questions about HUD’s oversight
of RAD, and about how much private funding is actual y being raised for public housing through
the conversions.127
RAD, as first authorized by Congress in the FY2012 HUD appropriations law, was original y
limited to 60,000 units of public housing (out of roughly 1 mil ion units).128 However, Congress
has since expanded the demonstration. Most recently, in FY2018, Congress raised the cap so that

120 For more information, see HUD’s website for Cohort #1: https://www.hud.gov/program_offices/
public_indian_housing/programs/ph/mtw/expansion/cohort1; and Cohort #2: https://www.hud.gov/program_offices/
public_indian_housing/programs/ph/mtw/expansion/cohort2. T he Notice for Cohort #1 is PIH Notice 2018-17, as
extended by PIH Notice 2019-03. T he Notice for Cohort #2 is PIH 2019 -04.
121 T he backlog estimate comes from Meryl Finkel, Ken Lam, et al., Capital Needs in the Public Housing Program
(Cambridge, MA: November 24, 2011).
122 While most of the focus of RAD has been on public housing conversions, the 2012 law also authorized a separate
component of RAD that allows for the conversion of older forms of rental assistance contracts (Rental Assistance
Payment and Rent Supplement contracts, which predate the Section 8 program) to Section 8. Absent this conversion,
HUD has no authority to renew those old contracts when they expire.
123 New affordability restrictions are placed on the property as a condition of a RAD conversion, but the y do not require
the same deep affordability as is required under the public housing deed restriction (called a Declaration of T rust).
124 While the raising of private capital is the most common incentive for conversion, not all conversions feature it. For
more information, see Econometrica, Inc. Evaluation of HUD’s Rental Assistance Dem onstration , Department of
Housing and Urban Development, interim report, September 2016, https://www.huduser.gov/portal/sites/default/files/
pdf/RAD-InterimRpt.pdf.
125 For example, see Letter from Sunia Zaterman, Executive Director, CLPHA, Saul Ramirez, Executive Director,
NAHRO, and T imothy G. Kaiser, Executive Director, PHADA, to House and Senate Appropriations Committee Chairs
and Ranking Members, April 16, 2017, http://www.clpha.org/uploads/Public_Housing/5-16-
14IndustryGroupLetteronRADCap.pdf.
126 For example, see Econometrica, Inc., Evaluation of HUD’s Rental Assistance Demonstration, Department of
Housing and Urban Development, interim report, September 2016, https://www.huduser.gov/portal/sites/default/files/
pdf/RAD-InterimRpt.pdf.
127 U.S. Government Accountability Office, Rental Assistance Demonstration: HUD Needs to Take Action to Improve
Metrics and Ongoing Oversight, GAO-18-123, February 2018, https://www.gao.gov/products/GAO-18-123.
128 P.L. 112-55; 125 Stat. 673.
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up to 455,000 units of public housing wil be permitted to convert to Section 8 under RAD, and it
further expanded the program so that Section 202 Housing for the Elderly units can also convert.
Not only is HUD currently implementing the FY2018 expansion, but the President’s FY2021
budget request to Congress—and past several budget requests to Congress—proposed that the cap
on public housing RAD conversions be eliminated completely.129
Quality of Federally Assisted Housing
The Housing Act of 1949 set as U.S. policy the promotion of “safe” and “decent” housing. In
light of this, federal y assisted housing is general y subject to minimum physical quality standards
as a condition of receiving assistance, and to periodic inspection to ensure that quality is
maintained. Those inspection protocols, including the exact standards the property must meet, the
frequency of inspection, and the entity that conducts the inspections, can al vary by program. In
recent years, news articles highlighting poor conditions at federal y assisted properties and
concerns raised by tenants and other stakeholders have focused policymakers’ attention on the
physical condition of the federal y assisted housing stock general y, and of HUD-assisted
properties in particular. This has led to cal s for changes to various elements of the existing
protocols. For example, see the following:
 Beginning in FY2014 and continuing each year since, Congress has included
language in the annual HUD appropriations laws directing HUD to take specific
actions when a Section 8 project-based rental assistance property scores below a
certain threshold. These laws have also provided a suite of enforcement tools
from which the Secretary can choose. The exact provisions and tools have
changed over the years, and legislation has been introduced to codify some or al
of them in the law governing the Section 8 PBRA program (including H.R. 3745,
the HUD Inspection Oversight Act of 2019).
 Congress has directed the Government Accountability Office to investigate
various elements of HUD’s inspection process, including the presence of lead-
based paint in assisted housing. GAO has issued several reports and a series of
recommendations, and has more underway.130
 Beginning in early 2019, HUD launched the National Standards for the Physical
Inspection of Real Estate (NSPIRE) initiative, which HUD has characterized as a
“wholesale reexamination” of the agency’s inspection process. It involves a
number of administrative changes to the current process (including shortening
notice to owners before inspections) as wel as a demonstration to test new
standards for inspection and collecting information about HUD-assisted
properties that launched in August 2019.131
 On November 20, 2019, the Subcommittee on Housing, Community
Development, and Insurance of the House Financial Services Committee held a
hearing entitled “Safe and Decent? Examining the Current State of Residents’
Health and Safety in HUD Housing.” The hearing featured witnesses from

129 See Section 219 of the General Provisions portion of the FY2020 President’s budget request for HUD.
130 For a summary, see U.S. Government Accountability Office, Rental Housing Assistance: HUD Should Strengthen
Physical Inspection of Properties and Oversigh t of Lead Paint Hazards, GAO-20-277T , November 20, 2019,
https://www.gao.gov/products/GAO-20-277T .
131 For more information about NSPIRE, see https://www.hud.gov/program_offices/public_indian_housing/reac/nspire/
concept .
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various housing providers and tenant groups and also discussed various draft and
introduced bil s related to reforms to HUD’s inspection and oversight protocols,
including H.R. 3745.
 A number of bil s have been introduced in the 116th Congress designed to address
specific hazards in federal y assisted housing, including lead-based paint hazards,
lead hazards in drinking water, and carbon monoxide poisoning.132
Native American Housing Programs
Native Americans living in tribal areas experience a variety of housing chal enges. Housing
conditions in tribal areas are general y worse than those for the United States as a whole, and
factors such as the legal status of trust lands present additional complications for housing.133 In
light of these chal enges, and the federal government’s long-standing trust relationship with
tribes, certain federal housing programs provide funding specifical y for housing in tribal areas.
Tribal HUD-VASH
The Tribal HUD-Veterans Affairs Supportive Housing (Tribal HUD-VASH) program provides
rental assistance and supportive services to Native American veterans who are homeless or at risk
of homelessness. Tribal HUD-VASH is modeled on the broader HUD-Veterans Affairs Supportive
Housing (HUD-VASH) program, which provides rental assistance and supportive services for
homeless veterans. Tribal HUD-VASH was initial y created and funded through the FY2015
HUD appropriations act (P.L. 113-235), and funds to renew rental assistance have been provided
in subsequent appropriations acts. No separate authorizing legislation for Tribal HUD-VASH
currently exists.
In the 116th Congress, a bil to codify the Tribal HUD-VASH program (S. 257) was ordered to be
reported favorably by the Senate Committee on Indian Affairs in February 2019 and passed the
full Senate in June 2019. An identical bil (H.R. 2999) has been introduced in the House and
referred to the Committee on Financial Services. A substantively identical bil also passed the
Senate during the 115th Congress (S. 1333), but the House ultimately did not consider it.
For more information on HUD-VASH and Tribal HUD-VASH, see CRS Report RL34024,
Veterans and Homelessness.
NAHASDA Reauthorization
The main federal program that provides housing assistance to Native American tribes and Alaska
Native vil ages is the Native American Housing Block Grant (NAHBG), which was authorized by
the Native American Housing Assistance and Self-Determination Act of 1996 (NAHASDA, P.L.
104-330). NAHASDA reorganized the federal system of housing assistance for tribes while
recognizing the rights of tribal self-governance and self-determination. The NAHBG provides
formula funding to tribes that can be used for a range of affordable housing activities that benefit
primarily low-income Native Americans or Alaska Natives living in tribal areas. A separate block

132 For example, the Carbon Monoxide Alarms Leading Every Resident T o Safety Act o f 2019 (H.R. 1690), which was
passed by the House; the Safe Housing for Families Act (S. 755); the Get the Lead Out of Assisted Housing Act of
2019 (H.R. 3721/S. 2087); the Lead-Free Future Act of 2019 (H.R. 4416); and the Public Housing Fire Safety Act (S.
3090/H.R. 5969).
133 U.S. Department of Housing and Urban Development, Assessment of American Indian, Alaska Native, and Native
Hawaiian Housing Needs, https://www.huduser.gov/portal/native_american_assessment/home.html.
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grant program authorized by NAHASDA, the Native Hawai an Housing Block Grant (NHHBG),
provides funding for affordable housing activities that benefit Native Hawai ans eligible to reside
on the Hawai an Home Lands.134 NAHASDA also authorizes a loan guarantee program, the Title
VI Loan Guarantee, for tribes to carry out eligible affordable housing activities.
The most recent authorization for most NAHASDA programs expired at the end of FY2013,
although NAHASDA programs have general y continued to be funded in annual appropriations
laws. (The NHHBG has not been reauthorized since its original authorization expired in FY2005,
though it has continued to receive funding in most years.135) NAHASDA reauthorization
legislation was considered in varying degrees in the 113th, 114th, and 115th Congresses but none
was ultimately enacted.136 In general, tribes and Congress have been supportive of NAHASDA,
though there has been some disagreement over specific provisions or policy proposals that have
been included in reauthorization bil s. Some of these disagreements involve debates over specific
program changes that have been proposed. Others involve debate over broader issues, such as the
appropriateness of providing federal funding for programs specifical y for Native Hawai ans and
whether such funding could be construed to provide benefits based on race.137
In the 116th Congress, a NAHASDA reauthorization bil (H.R. 5319) was introduced in the House
in December 2019. A Senate NAHASDA reauthorization bil (S. 4090) was introduced in June
2020 by Senator Hoeven and Senator Udal , Chairman and Vice Chairman, respectively, of the
Senate Committee on Indian Affairs. The bil s contain many similar provisions but also differ in a
number of ways.
For more information on NAHASDA, see CRS Report R43307, The Native American Housing
Assistance and Self-Determination Act of 1996 (NAHASDA): Background and Funding.
Proposed New Investments in Affordable Housing
The 116th Congress has seen proposals to expand federal resources for affordable housing in a
manner that is largely unprecedented in scope and scale. Some of these proposals were included
in the platforms of various 2020 Democratic Presidential candidates,138 including the nominee,
former Vice President Joe Biden.139 Some of these proposals have been introduced in Congress
and at least two have passed the House.

134 For more information on the Hawaiian Home Lands, and the eligibility requirements for Native Hawaiians to reside
on them, see the Department of Hawaiian Home Lands website at http://dhhl.hawaii.gov/about/.
135 In FY2016, no funding was appropriated for the NHHBG. However, HUD’s budget justification for FY2016 (as
well as other years) indicated that HUD would have sufficient carryover balances from prior-year appropriations to
continue to carry out activities under the program without a new appropriation.
136 In the 113th Congress, a NAHASDA reauthorization bill (H.R. 4329) was passed by the House, while a different bill
(S. 1352) was favorably reported out of committee in the Senate. In the 114 th Congress, a bill (H.R. 360) was again
passed by the House, while a different bill (S. 710) was favorably reported out of committee in the Senate. In the 115 th
Congress, similar, but not identical, bills were introduced in the House and the Senate ( H.R. 3864 and S. 1895,
respectively). H.R. 3864 was favorably reported out of committee in the House.
137 For more information on some of the issues that have been debated in the context of NAHASDA rea uthorization in
the past, see archived CRS Report R44261, The Native Am erican Housing Assistance and Self-Determ ination Act
(NAHASDA): Issues and Reauthorization Legislation in the 114th Congress.
138 Maggie Astor, “How the Democratic Candidates Would T ackle the Housing Crisis,” The New York Times, March 3,
2020, https://www.nytimes.com/2020/03/03/us/politics/housing-homelessness-2020-democrats.html.
139 T he proposal offered by candidate Biden is available at https://joebiden.com/housing/ and includes, among other
policies, an expansion of the Section 8 Housing Choice Voucher program to serve all eligible households, a new renters
tax credit, and creation of a $100 billion affordable housing fund.
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These sweeping new affordable housing proposals—some of which are briefly summarized
below—can be considered to include one or both of two main approaches: significant new federal
funding for the development or rehabilitation of affordable housing; and significant expansions of
direct federal assistance for renters. The first approach, a supply-side approach, is meant to
address concerns about the rate of growth in renter households outpacing the supply of rental
units affordable to them. A recent report from GAO cited the supply of low-cost rental units not
keeping up with demand as a key driver of recent affordability chal enges.140 HUD estimates that
only 59 affordable units were available per 100 very low-income renters in 2017, noting that total
additions to the nation’s rental supply have been inadequate to meet growing demand.141 The
second approach, a demand side approach, recognizes that the vast majority of persons facing
affordability chal enges are housed, but that their housing costs are too high to be considered
affordable. A recent report from HUD found a 7% reduction in very low-income renters with
severe housing problems from 2015 to 2017, and attributed that decline almost solely to income
increases (rather than supply additions).142
Funding for New Housing Development
There have been a number of proposals to significantly increase funding for the development of
new units of affordable housing and/or the rehabilitation of the existing stock of affordable
housing. For example, see the following:
 The Housing is Infrastructure Act of 2019 (H.R. 5187/S. 2951) would authorize
over $100 bil ion for various housing grant programs for the development of
affordable housing. For purposes of comparison, the accounts for which these
funds would be authorized received less than half that amount in regular
appropriations in FY2020. The bil was ordered reported by the House Financial
Services Committee in February 2020 and was incorporated into the Moving
Forward Act of 2020 (H.R. 2), which passed the House in July.
 The FY2021 HUD appropriations bil reported by the House Appropriations
Committee (H.R. 7616) and passed by the House (as a part of a multi-bil
appropriations package, H.R. 7617) included a new title appropriating an
additional $49 bil ion in emergency funding for HUD accounts to fund affordable
housing-related infrastructure investments. If approved, this would nearly double
HUD’s budget in FY2021.
 Other legislation that would provide notable increases in funding for affordable
housing development includes the American Housing and Economic Mobility
Act of 2019 (H.R. 1737/S. 787), which would authorize $44.5 bil ion per year for
10 years for the Housing Trust Fund (which to date has never received annual
funding above $330 mil ion), among other provisions; the Green New Deal for
Public Housing (H.R. 5185/S. 2876), which would appropriate “such sums as
may be necessary” for 10 years to provide grants for the rehabilitation and energy
retrofit needs of public housing, among other provisions; and the Homes for Al
Act of 2019 (H.R. 5244), which would appropriate $80 bil ion per year for 10

140 U.S. Government Accountability Office, As More Households Rent, the Poorest Face Affordability and Housing
Quality Challenges, GAO-20-427, May 27, 2020, https://www.gao.gov/products/GAO-20-427.
141Nicole Elsasser Watson et al., Worst Case Housing Needs: 2019 Report to Congress, Department of Housing and
Urban Development, Washington, DC, June 2020, https://www.huduser.gov/portal/sites/default/files/pdf/worst -case-
housing-needs-2020.pdf.
142 Ibid.
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years to build new public housing units and would authorize appropriations of
$20 bil ion per year for 10 years to fund privately owned affordable housing
units, among other provisions.
Aid to Renters
Federal rental assistance programs are funded to serve roughly one in four eligible households
currently, meaning there are long waiting lists for assistance in most communities. Some
proposals have included significant expansions of existing rental assistance (i.e., Housing Choice
Vouchers); others the creation of new direct subsidies for renters (i.e., refundable tax credits). For
example, see the following:
 The Pathway to Stable and Affordable Housing for Al Act (H.R. 5813/S. 2946)
would provide new mandatory appropriations intended to fund Housing Choice
Vouchers for al eligible households. The program currently receives a fixed
amount of discretionary appropriations each year, primarily to continue
assistance to currently assisted families. (Additional y, it would appropriate $40
bil ion per year for 10 years for the Housing Trust Fund, in addition to providing
other mandatory appropriations for homeless assistance.)
 The Rent Relief Act of 2019 (H.R. 2169/S. 1106) would create a new refundable
tax credit for renters paying more than 30% of their gross income towards rent,
which phases out for renters with higher incomes.
Nearly al of these proposals were released before the onset of the global pandemic and its related
housing chal enges. Depending on how the economic crisis triggered by the pandemic unfolds,
interest in these sweeping approaches to address affordable housing chal enges may increase; or,
given their cost and the state of national budget deficits, interest may wane.
Selected Administrative Actions Related to Affordable Housing
HUD Noncitizen Eligibility and Documentation Proposed Rule
On May 10, 2019, HUD released a proposed rule to end eligibility for “mixed status” families in
its major rental assistance programs (public housing, Section 8 Housing Choice Vouchers, Section
8 project-based rental assistance).143 Mixed status families comprise both citizens (or eligible
noncitizens) and ineligible noncitizens. Under current HUD regulations, mixed status families are
eligible to receive prorated assistance, meaning that the household can receive federal housing
assistance but their benefit must be reduced proportional y to avoid assisting ineligible
noncitizens (general y, nonimmigrants such as those in the country il egal y as wel as those with
temporary status, such as tourists and students). Additional y, the proposed rule would establish
new requirements that citizens provide documentation of their citizenship status.144 (For more
information, see CRS Insight IN11121, HUD’s Proposal to End Assistance to Mixed Status
Families.)

143 U.S. Department of Housing and Urban Development, “Amendments to Further Implement Provisions of the
Housing and Community Development Act of 1980,” 84 Federal Register 20589, May 10, 2019.
144 For more information, see CRS Insight IN11121, HUD’s Proposal to End Assistance to Mixed Status Families.
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Low-income housing advocates145 and stakeholder groups representing program administrators146
have publicly opposed the proposed rule change, citing its potential disruptive effect on the
roughly 25,000 currently assisted mixed status families, as wel as the increases in both subsidy
costs (estimated at $200 mil ion per year by HUD) and administrative costs it would cause.
Legislative language to block implementation of the rule was included in the House-passed
FY2021 HUD appropriations bil (H.R. 7616, as incorporated into H.R. 7617); H.R. 2763, as
ordered reported by the House Financial Services Committee; and S. 1904, as introduced in the
Senate. (Identical appropriations language was included in the House-passed FY2020 HUD
appropriations bil , but was not included in the final FY2020 HUD appropriations law, P.L. 116-
94.) As of the date of this report, HUD has not promulgated a final rule.
Equal Access to Housing
On July 24, 2020, HUD released a proposed rule that would make changes to its Equal Access to
Housing rule.147 HUD initial y published an Equal Access to Housing rule in 2012, stating that
housing provided through HUD programs must be made available regardless of a person’s sexual
orientation, gender identity, or marital status.148 Another Equal Access to Housing rule—
specifical y targeted to HUD Community Planning and Development (CPD) programs, where
funding can be used to fund shelters for people experiencing homelessness—was published in
2016.149 The 2016 Equal Access to Housing rule requires that placement in facilities with shared
sleeping and/or bath accommodations occur in conformance with a person’s gender identity.
The 2020 proposed rule would al ow CPD program grant recipients that operate single-sex
facilities to consider biological sex in admissions determinations, as long as each recipient’s
policy is applied consistently. For example, a single-sex shelter for women could not “decline to
accommodate a person who identifies as male but who is a biological female.”150 Where a shelter
provider “has a good faith basis to doubt the consistency of the sex asserted with the sex served
by the shelter,” then the proposed rule would al ow the provider to ask for such documents as
birth certificates or other identification and medical records.151 If a shelter provider were to deny
admission to a client based on its single-sex policy, the proposed rule would require that the

145 For example, see “Housing, Faith, Civil Rights, Social Justice, and Immigration Leaders Rally to Oppose HUD Rule
T hat Would Separate Families or Evict T hem,” May 10, 2019, a joint press statement, available at https://nlihc.org/
news/housing-faith-civil-rights-social-justice-and-immigration-leaders-rally-oppose-hud-rule-would.
146 For example, see “CLPHA Strongly Opposes HUD’s Non -Citizen Proposal,” Council of Large Public Housing
Authorities, May 2, 2019, available at https://clpha.org/news/2019/clpha-strongly-opposes-hud%E2%80%99s-non-
citizen-proposal.
147 U.S. Department of Housing and Urban Development, “Making Admission or Placement Determinations Based on
Sex in Facilities Under Community Planning and Development Housing Programs, ” 85 Federal Register 44811, July
24, 2020.
148 U.S. Department of Housing and Urban Development, “Equal Access to Housing in HUD Programs Regardless of
Sexual Orientation or Gender Identit y,” 77 Federal Register 5662-5676, February 3, 2012, http://portal.hud.gov/
hudportal/documents/huddoc?id=12lgbtfinalrule.pdf.
149 U.S. Department of Housing and Urban Development, “Equal Access in Accordance With an Individual’s Gender
Identity in Community Planning and Development Programs,” 81 Federal Register 64763-64782, September 21, 2016.
150 85 Federal Register 44812.
151 Ibid., p. 44815.
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provider provide a recommendation for another shelter.152 Providers could also choose to continue
admissions based on a client’s gender identity.153
Legislation to prohibit HUD from implementing a rule making changes to admissions at single-
sex shelters was approved by the House Financial Services Committee on June 11, 2019.154 (See
the Ensuring Equal Access to Shelter Act of 2019, H.R. 3018.) In addition, the FY2020 House-
passed HUD appropriations bil (Section 236 of Division E of H.R. 3055) would have prevented
HUD from making changes to either the 2012 or 2016 Equal Access to Housing rules. (The
language from H.R. 3055 was not included in the final FY2020 HUD appropriations law, P.L.
116-94.) The FY2021 House-passed appropriations bil for multiple agencies, including HUD,
would not al ow funds to be used to implement, administer, or enforce the proposed rule (Section
235 of HUD General Provisions in H.R. 7617 ).
For more information about the Equal Access to Housing rules, see CRS Report R44557, The
Fair Housing Act: HUD Oversight, Programs, and Activities.
Regulatory Barriers Council
On June 25, 2019, President Trump signed an Executive Order establishing a White House
Council on Eliminating Regulatory Barriers to Affordable Housing.155 The council is to be
chaired by the HUD Secretary, but wil include members from eight federal agencies. The council
is charged with assessing federal, state, and local regulations and the effect they are having on
developing new affordable housing; taking action to reduce federal regulatory barriers; and
supporting state and local efforts to reduce regulatory barriers.
On November 22, 2019, HUD published a Request for Information in the Federal Register
seeking input from the public on “Federal, State, local and Tribal laws, regulations, land use
requirements, and administrative practices that artificial y raise the costs of affordable housing
development and contribute to shortages in housing supply.”156
Affirmatively Furthering Fair Housing
The Fair Housing Act requires HUD to administer its programs in a way that affirmatively
furthers fair housing.157 In addition, statutes or regulations governing specific HUD programs
require that funding recipients affirmatively further fair housing (AFFH). On July 16, 2015, HUD
published a final rule that more specifical y defined what it means to affirmatively further fair
housing, and required that local communities and Public Housing Authorities (PHAs) receiving
HUD funding assess the needs of their communities and ways in which they c ould improve
access to housing, and submit reports, cal ed Assessments of Fair Housing, to HUD.

152 Ibid., p. 44818.
153 Ibid., p. 44812.
154 T he legislation was introduced and considered prior to publication of the proposed rule. As a result, the bill refers to
HUD’s proposed new rule as described in the Federal Register Unified Agenda in Spring 2019. See
https://www.reginfo.gov/public/do/eAgendaVie wRule?pubId=201904&RIN=2506-AC5.
155 Executive Order 13878, “Establishing a White House Council on Eliminating Regulatory Barriers to Affordable
Housing,” 84 Federal Register 30853-30856, June 28, 2019.
156 Department of Housing and Urban Development (HUD), “White House Council on Eliminating Regulatory Barriers
to Affordable Housing; Request for Information,” 84 Federal Register 64549, November 22, 2019.
157 42 U.S.C. §3608(e)(5).
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After the AFFH rule began to be implemented, on May 23, 2018, HUD effectively suspended its
implementation. Several months later, on August 13, 2018, HUD announced an Advance Notice
of Proposed Rulemaking stating that it “has determined that a new approach towards AFFH is
required” and requesting public comments on potential changes to the AFFH regulations.158 On
January 14, 2020 HUD released a new proposed AFFH rule;159 the comment period for the
proposed rule closed on March 16, 2020. The proposed rule would have instituted a new
definition of what it means to affirmatively further fair housing and al owed communities to
certify their adherence to requirements through the consolidated planning process. The process
would not have applied to PHAs.
Before the January 14, 2020 proposed rule could be finalized, HUD issued a different final rule
on August 7, 2020, “Preserving Community and Neighborhood Choice.”160 The final rule states
that HUD need not go through the notice and comment process normal y required of rulemaking
under the Administrative Procedure Act (APA) due to an APA exception for matters “relating to
agency management or personnel or to public property, loans, grants, benefits, or contracts.”161
The final rule states that fair housing “means housing that, among other attributes, is affordable,
safe, decent, free of unlawful discrimination, and accessible as required under civil rights laws,”
and that AFFH is “to take any action rational y related to promoting any attribute or attributes of
fair housing ... ”162 Communities are to certify that they have satisfied the requirement to
affirmatively further fair housing as part of their consolidated plans; the rule does not apply to
PHAs. The rule is to take effect 30 days from its publication in the federal register.
The FY2021 House-passed appropriations bil for multiple agencies, including HUD, would not
al ow funds to be used to implement, administer, or enforce the final rule (Section 506 of the
General Provisions for Additional Infrastructure Investments in H.R. 7617).
For more information about the AFFH rule, see CRS Report R44557, The Fair Housing Act:
HUD Oversight, Programs, and Activities.
Housing and Disaster Response and Recovery
When disasters occur, the President may authorize an emergency or major disaster declaration163
under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act; P.L. 93-
288, as amended). The presidential declaration may authorize the Federal Emergency
Management Agency (FEMA) to provide various short-term and interim housing assistance
programs.164

158 U.S. Department of Housing and Urban Development, “HUD Seeks to Streamline and Enhance ‘Affirmatively
Furthering Fair Housing’ Rule,” press release, August 13, 2018, https://www.hud.gov/press/
press_releases_media_advisories/HUD_No_18_079; and U.S. Department of Housing and Urban Development,
“Affirmatively Furthering Fair Housing: Streamlining and Enhancemen ts,” 83 Federal Register 40713-40715, August
16, 2018, https://www.gpo.gov/fdsys/pkg/FR-2018-08-16/pdf/2018-17671.pdf.
159 U.S. Department of Housing and Urban Development, “Affirmatively Furthering Fair Housing,” 85 Federal
Register 2041, January 14, 2020.
160 U.S. Department of Housing and Urban Development, “Preserving Community and Neighborhood Choice,” 85
Federal Register 47899, August 7, 2020.
161 Ibid.. p. 47904 citing the APA at 5 U.S.C. §553(a)(2).
162 85 Federal Register 47905.
163 For more information about the disaster declaration process, see CRS Report R43784, FEMA’s Disaster
Declaration Process: A Prim er.
164 A presidential declaration authorizing Individual Assistance makes Small Business Administration (SBA) Disaster
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Emergency sheltering may be authorized under Stafford Act Section 502165 following an
emergency declaration, and Stafford Act Section 403166 following a major disaster declaration or
Fire Management Assistance Grant declaration (FMAG).167 This assistance is commonly referred
to as Public Assistance (PA) Category B—Emergency Protective Measures. When PA is
authorized, FEMA wil reimburse state, tribal, territorial, and local governments, as wel as
eligible nonprofits (PA Applicants) for at least 75% of eligible costs incurred while performing
eligible work.168 FEMA’s regulations on emergency sheltering are limited, though program
guidance may be issued for a specific incident. Short-term, emergency sheltering
accommodations169 can include congregate and non-congregate sheltering solutions. Although
congregate solutions (i.e., sheltering in facilities with large, open spaces, such as schools and
community centers) are typical y provided, during the ongoing COVID-19 pandemic, non-
congregate solutions (i.e., sheltering that affords privacy, such as dormitories, hotels, and motels)
may be provided, per FEMA policy.170 For example, the Transitional Sheltering Assistance (TSA)
program may be used to provide short-term hotel/motel accommodations to eligible disaster
survivors transitioning from congregate or non-congregate shelters to temporary or permanent
housing solutions.171
Interim housing needs may be met through the Individuals and Households Program (IHP), which
may be authorized under Stafford Act Section 408 following an emergency or major disaster
declaration.172 The federal share of eligible costs associated with IHP housing assistance is
100%.173 IHP housing assistance may include financial assistance (e.g., assistance to rent alternate
housing accommodations or repair a homeowner’s primary residence) and/or direct assistance
(e.g., a FEMA-provided Manufactured Housing Unit (MHU)) to eligible individuals and

Loans available (SBA, A Reference Guide to the SBA Disaster Loan Program, May 2015, p. 4, https://www.sba.gov/
sites/default/files/files/SBA_Disaster_Loan_Program_Reference_Guide.pdf). For more information on SBA Disaster
Loans, see CRS Report R41309, The SBA Disaster Loan Program : Overview and Possible Issues for Congress.
165 42 U.S.C. §5192.
166 42 U.S.C. §5170b.
167 FEMA, Fire Management Assistance Grant Program Guide, FEMA P-954, February 2014, p. 20,
https://www.fema.gov/media-library-data/1581017232216-74156de976d581852e91b9826c2968c2/
FMAG_Guide_Feb_2014_508.pdf.
168 42 U.S.C. §5170b(b).
169 Short-term sheltering may be authorized under Stafford Act Section 403 —Essential Assistance.
170 FEMA, “Emergency Non-Congregate Sheltering during the COVID-19 Public Health Emergency (Interim),” FEMA
Policy 104-009-18, June 17, 2020, https://www.fema.gov/media-library-data/1592489053244-
179ccfba96c36d22d32f9cbbea0108bf/fema_public_assistance_non_covid-19_NCS_Policy.pdf (hereinafter FEMA,
“Interim Emergency Non-Congregate Sheltering Policy”).
171 FEMA’s T ransitional Sheltering Assistance (T SA) program is intended to provide short -term hotel/motel
accommodations to individuals and families who are unable to return to their pre-disaster primary residence because a
declared disaster rendered it uninhabitable or inaccessible. T he initial period of T SA assistance is 5 -14 days, and it can
be extended in 14-day intervals for up to six months from the date of the disaster declaration. 42 U.S.C. §5170b; see
also Federal Emergency Management Agency (FEMA), Individuals and Households Program Unified Guidance
(IHPUG), FP 104-009-03, September 2016, pp. 123-125, https://www.fema.gov/media-library-data/1483567080828-
1201b6eebf9fbbd7c8a070fddb308971/FEMAIHPUG_CoverEdit_December2016.pdf (note that FEMA’s IHPUG
applies to any disaster declared on or after September 30, 2016); and FEMA, Individual Assistance Program and
Policy Guide (IAPPG), FP 104-009-03, March 2019, p. 40, https://www.fema.gov/media-library-data/1551713430046-
1abf12182d2d5e622d16accb37c4d163/IAPPG.pdf (hereinafter FEMA, IAPPG) (note that FEMA’s IAPPG applies to
any disaster declared on or after March 1, 2019 ).
172 42 U.S.C. §5174. It is uncommon for the Individuals and Households Program to be authorized following an
emergency declaration (FEMA, “How a Disaster Gets Declared,” https://www.fema.gov/disasters/how-declared).
173 42 U.S.C. §5174(g)(1).
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households who, as a result of an emergency or disaster, have uninsured or under-insured
necessary expenses and serious needs that cannot be met through other means or forms of
assistance.174 IHP assistance is intended to be temporary and is general y limited to a period of 18
months following the date of the declaration, but it may be extended by FEMA.175
In addition to FEMA assistance, following a disaster, Congress may appropriate funds through
HUD’s Community Development Block Grant for disaster recovery (CDBG-DR) to assist
communities in long-term rebuilding (see the “Community Development Block Grants-Disaster
Recovery (CDBG-DR)” section for more information).
Emergency Sheltering Options During the COVID-19 Pandemic
According to FEMA, state, local, tribal, and territorial governments (SLTTs) are responsible for
coordinating emergency sheltering support after a Stafford Act emergency or major disaster
declaration.176 However, the ongoing COVID-19 pandemic may complicate efforts to provide
sheltering in typical congregate settings due to the need to ensure appropriate social distancing.
To that end, FEMA issued an interim policy for non-congregate sheltering in the event of a
Stafford Act declaration through the end of 2020 (this guidance may apply to presidential
declarations for hurricanes, wildfires, or other incidents).177
FEMA may authorize non-congregate sheltering as an eligible emergency protective measure
when needed, if it is the legal responsibility of the PA Applicant (general y, SLTTs are responsible
for protecting public health and safety).178 The policy is applicable for al Stafford Act declared
incidents between June 1 and December 31, 2020, beginning six days prior to and up to thirty
days following an incident (unless FEMA approves an extension).179 PA Applicants requesting
reimbursement must provide sufficient documentation and must follow FEMA’s procurement
policies when contracting to carry out emergency protective measures, including the provision of
non-congregate sheltering.180 Additional y, PA Applicants may not receive assistance that
duplicates assistance from other sources or federal agencies.181 FEMA wil review its policy by
December 31, 2020.
For more information, see CRS Insight IN11440, Potential FEMA Emergency Sheltering Options
During the COVID-19 Pandemic; and CRS Report R46326, Stafford Act Declarations for
COVID-19 FAQ.

174 42 U.S.C. §5174. For more information, see CRS Report R46014, FEMA Individual Assistance Programs: An
Overview.
175 44 C.F.R. §206.110(e).
176 FEMA, Mass Care/Emergency Assistance Pandemic Planning Considerations For State, Local, T ribal, T erritorial
and Non-Government Organizational Planners, Providers and Support Agencies, June 2020, p. 1,
https://www.fema.gov/media-library-data/1591805537743-dd381cfb5c45eea9999dac1637815716/
MCEA_Pandemic_Planning_Considerations_Guide_508.pdf .
177 FEMA, “Interim Emergency Non-Congregate Sheltering Policy.”
178 FEMA, “Interim Emergency Non-Congregate Sheltering Policy,” pp. 2-3.
179 FEMA, “Interim Emergency Non-Congregate Sheltering Policy,” p. 2.
180 FEMA, “Interim Emergency Non-Congregate Sheltering Policy,” p. 4.
181 FEMA, “Interim Emergency Non-Congregate Sheltering Policy,” p. 5.
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Implementation of Housing-Related Provisions of the Disaster Recovery
Reform Act (DRRA)
The Disaster Recovery Reform Act of 2018 (DRRA, Division D of P.L. 115-254), which was
enacted on October 5, 2018, near the end of the 115th Congress, is the most comprehensive reform
of FEMA’s disaster assistance programs since the passage of the Sandy Recovery Improvement
Act of 2013 (SRIA, Division B of P.L. 113-2) and the Post-Katrina Emergency Management
Reform Act of 2006 (PKEMRA, P.L. 109-295). The DRRA legislation focuses on improving pre-
disaster planning and mitigation, response, and recovery, and increasing FEMA accountability. As
such, it amends many sections of the Stafford Act and includes new standalone authorities. In
addition, DRRA requires reports to Congress,182 rulemaking, and other actions.
The 116th Congress has expressed interest in the oversight of DRRA’s implementation, including
sections that amend FEMA’s temporary housing assistance programs under Stafford Act Section
408, the Individuals and Households Program. These sections include the following:
 DRRA Section 1211—State Administration of Assistance for Direct Temporary
Housing and Permanent Housing Construction—amended Stafford Act Section
408(f)—Federal Assistance to Individuals and Households, State Role—to al ow
state, territorial, or tribal governments to administer Direct Temporary Housing
Assistance and Permanent Housing Construction, in addition to Other Needs
Assistance (ONA).183 It also provides a mechanism for state and local units of
government to be reimbursed for local y implemented housing solutions.184 This
provision may al ow states to customize disaster housing solutions and expedite
disaster recovery. On July 28, 2020, FEMA announced the publication of the
State-Administered Direct Housing Grant Guide, making “[s]tate, local, tribal
and territorial governments ... eligible to receive grants in order to provide
disaster housing missions to disaster survivors [for a limited period of time].”185
FEMA wil offer the grant, which al ows states, territories, and Indian tribal
governments to administer Direct Temporary Housing Assistance and Permanent
Housing Construction, under a pilot program that runs until October 5, 2020, and
FEMA wil then work to develop and issue final regulations to implement this
authority.186

182 Examples include requirements for the FEMA Administrator to review program processes or progress in completing
tasks and reporting specific information to the House and Senate committees of jurisdiction (e.g., see DRRA Section
1245—Review of Assistance for Damaged Underground Water Infrastructure, and Section 1242 —FEMA Updates on
National Preparedness Assessment); and requirements for the Inspector General of the Department of Homeland
Security to conduct audits and report on audit findings and recommendations (e.g., see DRRA §1226 —Inspector
General Audit of FEMA Contracts for T arps and Plastic Sheeting).
183 §1211(a) of DRRA, P.L. 115-254. Other Needs Assistance (ONA) provides a grant of financial assistance for other
disaster-related necessary expenses and serious needs. ONA may provide assistance to repair or replace items, such as
personal property or a vehicle damaged by a disaster, and also may provide assistance with relocating and storing
personal property while home repairs are made, Group Flood Insurance policies, and funding to assist with expenses
related to funerals, medical and dental care, childcare, as well as miscellaneous expenses, in addition to other things.
For more information, see CRS Report R46014, FEMA Individual Assistance Program s: An Overview.
184 §1211(b) of DRRA, P.L. 115-254.
185 FEMA, “FEMA Bulletin Week of July 27, 2020.” https://content.govdelivery.com/accounts/USDHSFEMA/
bulletins/297b876. T he State-Adm inistered Direct Housing Grant Guide provides guidance to allow states, territories,
and Indian tribal governments to receive grant funds under a cooperative agreement.
186 FEMA stated that it is developing a State-Administered Direct Housing Grant Guide that will serve as interim
guidance and will provide the guidance that enables implementation of the pilot program, which will end after two
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 DRRA Section 1212—Assistance to Individuals and Households—amended
Stafford Act Section 408(h)—Federal Assistance to Individuals and Households,
Maximum Amount of Assistance—to separate the cap on the maximum amount
of financial assistance eligible individuals and households may receive for
housing assistance and ONA.187 Prior to the enactment of DRRA, there was a cap
on the maximum amount of financial assistance an individual or household could
receive. Financial assistance for both the financial forms of housing assistance
and Other Needs Assistance (ONA) combined to count towards the “cap”—or
maximum amount of financial assistance. Post-DRRA, financial assistance for
housing-related needs may not exceed $35,500 (FY2020; adjusted annual y), and
separate from that, financial assistance for ONA may not exceed $35,500
(FY2020; adjusted annual y). DRRA Section 1212 also removed financial
assistance to rent alternate housing accommodations from the cap, and created an
exception for accessibility-related costs.188 This may better enable FEMA’s
disaster assistance programs to meet the recovery-related needs of individuals,
including those with disabilities and others with access and functional needs, and
households who experience significant damage to their primary residence and
personal property as a result of an emergency or major disaster.
 DRRA Section 1213—Multifamily Lease and Repair Assistance—amended
Stafford Act Section 408(c)(1)(B)—Federal Assistance to Individuals and
Households, Direct Assistance—to expand the eligible areas for multifamily
lease and repair, and remove the requirement that the value of the improvements
or repairs not exceed the value of the lease agreement.189 This may increase
housing options for disaster survivors. The Inspector General of the Department
of Homeland Security must assess the use of FEMA’s direct assistance authority
to justify this alternative to other temporary housing options, and submit a report
to Congress.190
Congress may wish to track the implementation of DRRA to review the effectiveness and impacts
of FEMA’s DRRA-related regulations and policy guidance, including assessing the effects of
DRRA-related changes to federal disaster housing assistance for past and future disasters. For

years and will then require a rulemaking. As of the date of publication of this report, FEMA stated that the interim
guidance had been transmitted to the Department of Homeland Security for clearance ( email correspondence from
FEMA Congressional Affairs staff, November 19, 2019). See also FEMA, Disaster Recovery Reform Act (DRRA)
Annual Report, October 2019, p. 13, https://www.fema.gov/media-library-data/1573222648380-
b2fc54c82eb3b03c0724cbc696a94613/DRRAAnnualReport_FINAL_PUBLISHED.pdf (hereinafter FEMA, DRRA
Annual Report).
187 §1212 of DRRA, P.L. 115-254. Prior to DRRA, an individual or household could receive up to $33,300 (FY2017;
adjusted annually) (see FEMA, DHS, “ Notice of Maximum Amount of Assistance Under the Individuals and
Households Program,” 81 Federal Register 70431, October 12, 2016, https://www.govinfo.gov/content/pkg/FR-2016-
10-12/pdf/2016-24626.pdf). Post-DRRA, financial assistance for housing-related needs may not exceed $35,500
(FY2020; adjusted annually), and separate from that , financial assistance for ONA may not exceed $35,500 (FY2020;
adjusted annually) (see §1212 of DRRA, P.L. 115-254; FEMA, “ Notice of Maximum Amount of Assistance,” 84
Federal Register 55323-55324).
188 §1212 of DRRA, P.L. 115-254.
189 §1213 of DRRA, P.L. 115-254. FEMA is updating its IAPPG to implement this provision, and, per the DRRA
Annual Report, “ [i]n the interim, FEMA will implement this provision, as warranted by disaster impacts, through
policy waivers.” FEMA, DRRA Annual Report, p. 18.
190 §1213(c) of DRRA, P.L. 115-254. T his must be completed within two years of the enactment of DRRA (i.e., it is
due by October 5, 2020).
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more information on DRRA, including a more detailed analysis of the changes to the Individuals
and Households Program and tables of deadlines associated with the implementation actions and
requirements of DRRA, see CRS Report R45819, The Disaster Recovery Reform Act of 2018
(DRRA): A Summary of Selected Statutory Provisions.
FEMA Short-term, Emergency Housing Program Change
FEMA has also made a change to the available assistance options that may be provided under
Stafford Act Section 403—Essential Assistance—to meet short-term, emergency sheltering needs.
In October 2019, FEMA publicly announced that it was ending the Sheltering and Temporary
Essential Power (STEP) pilot program.191 The STEP pilot program provided an alternative
emergency sheltering option that al owed disaster survivors to shelter at home. STEP-funded
work al owed FEMA to fund “minimal, temporary protective repairs ... to private homes,” the
intent being to “quickly make damaged homes habitable in the short term until homeowners could
complete more permanent repairs independently through other FEMA programs or using private
insurance payments.”192
The justification provided by FEMA for ending the STEP program was that it “was not meeting
its established objectives” based on FEMA’s analysis of the program, which was used following
several disasters.193 Specifical y, “FEMA found that repairs under the STEP pilot program
general y could not be made quickly enough to effectively serve as shelter under section 403 of
the Stafford Act.”194 For example, in the U.S. Virgin Islands, although the program was
authorized in October 2017, initial repairs did not begin until March 2018, and eligible work was
not completed until April 2019. So although the program was intended to run for the three to four
months following the disaster, the STEP pilot program operated for 18 months.195 An additional
chal enge identified related to limiting the scope of the program to performing minimal,
emergency repairs.196 As an example of how the program’s scope shifted, FEMA expanded the
STEP pilot program it conducted in the U.S. Virgin Islands to also al ow for permanent repair or
replacement of damaged roofs.197

191 FEMA, “Bulletin Week of October 21, 2019,” https://content.govdelivery.com/accounts/USDHSFEMA/bulletins/
2679511. In a report by GAO, it was noted that, “ In May 2019, FEMA’s Chief Counsel stated that FEMA had decided
to discontinue the ST EP pilot program due to significant challenges and lessons learned from prior experiences
implementing the program.” U.S. Government Accountability Office, U.S. Virgin Islands Recovery: Additional Actions
Could Strengthen FEMA’s Key Disaster Recovery Efforts, GAO-20-54, November 2019, p. 31, https://www.gao.gov/
assets/710/702744.pdf (hereinafter, GAO, U.S. Virgin Islands Recovery).
192 U.S. Government Accountability Office, U.S. Virgin Islands Recovery, pp. 27-28; see also FEMA, “Recovery
Program Guidance: Sheltering and T emporary Essential Power (ST EP) Pilot Program for FEMA -4336-DR-PR and
FEMA-4339-DR-PR,” October 25, 2017.
193 FEMA, “Bulletin Week of October 21, 2019,” https://content.govdelivery.com/accounts/USDHSFEMA/bulletins/
2679511. Although the FEMA Bulletin cites seven disasters, GAO reported that FEMA authorized the ST EP pilot
program following eight disasters (GAO, U.S. Virgin Islands Recovery, pp. 34-35). T he GAO report includes an
overview of the ST EP pilot programs that FEMA implemented. ST EP was first used in 2012 following Hurricane
Sandy. It has also been used in 2016 (Louisiana following severe storms), 2017 (T exas following Hurricane Harvey,
Puerto Rico following Hurricane Irma and Hurricane Maria, U.S. Virgin Islands following Hurrica ne Irma and
Hurricane Maria), and 2018 (North Carolina following Hurricane Florence). T he GAO report includes brief
descriptions of the past ST EP pilot programs (GAO, U.S. Virgin Islands Recovery, pp. 33-34).
194 FEMA, “Bulletin Week of October 21, 2019,” https://content.govdelivery.com/accounts/USDHSFEMA/bulletins/
2679511; GAO, U.S. Virgin Islands Recovery, p. 31.
195 GAO, U.S. Virgin Islands Recovery, p. 32.
196 GAO, U.S. Virgin Islands Recovery, p. 31.
197 GAO, U.S. Virgin Islands Recovery, p. 28.
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Despite the chal enges FEMA faced with implementing the STEP pilot program, there may stil
be a need for a short-term disaster housing program that can serve as an alternative to existing
emergency sheltering solutions such as congregate care shelters or the TSA program. In
November 2019, GAO published a report noting that “FEMA used the STEP pilot program to
supplement other FEMA sheltering programs and provide necessary additional capacity to help
address the emergency sheltering needs of disaster-affected communities.”198 The report also
noted that “conducting a broad evaluation of FEMA’s emergency sheltering programs and the
agency’s options for addressing emergency sheltering needs ... would help FEMA understand its
ability to provide sheltering options and to properly plan for the provision of effective emergency
sheltering assistance to disaster-affected communities.”199 The Department of Homeland Security
concurred with GAO’s recommendation that the FEMA Administrator evaluate FEMA’s options
for providing future emergency sheltering assistance,200 and as of August 2020, FEMA has fully
implemented the GAO’s suggestion and the GAO considers the recommendation “closed as
implemented.”201 Specifical y, FEMA determined that it could provide emergency sheltering to
disaster survivors by “using a combination of existing capabilities and building capacity for
specialized teams tasked with coordinating with state, local, tribal, and territorial governments to
identify viable sheltering options.”202 Congress may stil wish to monitor FEMA’s efforts to
implement emergency sheltering assistance programs to meet the short-term emergency housing
needs of disaster survivors—particularly those disaster survivors who reside in areas with limited
housing stock.
Congress may also wish to explore disaster housing solutions that provide the flexibility needed
to support disaster survivors when the existing solutions are infeasible or impractical (e.g., there
are not enough hotels/motels to shelter people through the TSA program, or there is not space
available to deploy MHUs).203 To accomplish this, Congress may consider requiring FEMA to
collaborate with disaster housing partners to identify and outline emergency, short-term, interim,
and long-term disaster housing solutions. Additional y, this may require an update to the National
Disaster Housing Strategy204 to reflect the findings of FEMA’s evaluation. An update to the
National Disaster Housing Strategy may also present the opportunity to update the roles and
responsibilities of housing partners, disaster housing practices, and solutions for meeting the
housing needs of disaster survivors across al phases of disaster recovery. Congress may also
consider pursuing legislative solutions, including by consolidating, eliminating, or revising
existing authorities and programs; or creating new programs that address congressional y
identified unmet needs.

198 GAO, U.S. Virgin Islands Recovery, p. 33.
199 GAO, U.S. Virgin Islands Recovery, p. 36.
200 GAO, U.S. Virgin Islands Recovery, p. 44.
201 GAO, U.S. Virgin Islands Recovery: Additional Actions Could Strengthen FEMA’s Key Disaster Recovery Efforts,
GAO-20-54, November 2019, “ Recommendations for Executive Action,” https://www.gao.gov/products/GAO-20-54?
mobile_opt_out=1#summary_recommend (hereinafter GAO, U.S. Virgin Islands Recovery: Additional Actions,
“Recommendations for Executive Action”). See Recommendation 1 “Status” and “Comments.” T his involved
“review[ing] a range of existing documentation, including findings from after action reports conducted following prior
disasters and the agency’s Continuous Improvement Program.”
202 GAO, U.S. Virgin Islands Recovery: Additional Actions, “Recommendations for Executive Action.” See
Recommendation 1 “Status” and “Comments.”
203 GAO, U.S. Virgin Islands Recovery, p. 35.
204 T he National Disaster Housing Strategy describes how disaster housing is provided, but it was last published in
2009. T he strategy and appendices are available on FEMA’s website. FEMA, “ T he National Disaster Housing
Strategy,” last updated May 1, 2014, https://www.fema.gov/media-library/assets/documents/20294.
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Community Development Block Grants-Disaster Recovery (CDBG-DR)
HUD provides CDBG-DR grants to states and localities to assist their recovery efforts following
a presidential y declared disaster. General y, grantees must use at least half of these funds for
activities that principal y benefit low- and moderate-income persons or areas. The program is
designed to help communities and neighborhoods that otherwise might not recover due to limited
resources.205 CDBG-DR is not available for al major disasters because it is general y subject to
Congress passing CDBG supplemental appropriations.
In the 116th Congress, CDBG-DR has been provided $2.4 bil ion to aid disaster-affected
communities with long-term recovery, including the restoration of housing, infrastructure, and
economic activity.206 This follows the provision of $37 bil ion for CDBG-DR in the 115th
Congress.207
While CDBG-DR has had a significant role in funding recovery efforts from past disasters, and
continues to play a major role in the recovery from the 2017 hurricanes, it is not a formal y
authorized program, meaning the rules that govern the funding use and oversight vary with HUD
guidance accompanying each al ocation. Some Members of Congress have expressed interest in
formal y authorizing CDBG-DR, in part in response to concerns about HUD’s oversight of
CDBG-DR funding. In July 2019, the House Financial Services Committee ordered to be
reported H.R. 3702, the Reforming Disaster Recovery Act of 2019, which would authorize
CDBG-DR and includes a number of provisions to codify financial controls over program funds.
The House passed the bil in November 2019.
For more information on CDBG-DR, see CRS Report R46475, The Community Development
Block Grant’s Disaster Recovery (CDBG-DR) Component: Background and Issues.
Housing-Related Tax Extenders
In the past, Congress has regularly extended a number of temporary tax provisions that address a
variety of policy issues, including certain provisions related to housing. This set of temporary
provisions is commonly referred to as “tax extenders.” Two housing-related provisions that have
been included in tax extenders packages recently are (1) the exclusion for canceled mortgage
debt, and (2) the deduction for mortgage insurance premiums, each of which is discussed further
below.
The most recently enacted tax extenders legislation was included in the Further Consolidation
Appropriations Act, 2020 (P.L. 116-94) in the 116th Congress. That law extended the exclusion for
canceled mortgage debt and the ability to deduct mortgage insurance premiums through the end
of 2020 (each had previously expired at the end of 2017).
For more information on tax extenders, see CRS Report R46243, Individual Tax Provisions (“Tax
Extenders”) Expiring in 2020: In Brief .

205 U.S. Department of Housing and Urban Development, Community Development Block Grant Disaster Recovery
Program , HUD Exchange, 2014, https://www.hudexchange.info/programs/cdbg-dr/.
206 P.L. 116-20.
207 For the allocation of these funds, see https://www.hudexchange.info/programs/cdbg-dr/cdbg-dr-grantee-contact-
information/#all-disasters.
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Exclusion for Canceled Mortgage Debt
Historical y, when al or part of a taxpayer’s mortgage debt has been forgiven, the forgiven
amount has been included in the taxpayer’s gross income for tax purposes.208 This income is
typical y referred to as canceled mortgage debt income.
During the housing market turmoil of the late 2000s, some efforts to help troubled borrowers
avoid foreclosure resulted in canceled mortgage debt.209 The Mortgage Forgiveness Debt Relief
Act of 2007 (P.L. 110-142), signed into law in December 2007, temporarily excluded qualified
canceled mortgage debt income associated with a primary residence from taxation. The provision
was original y effective for debt discharged before January 1, 2010, and was subsequently
extended several times.
Rationales put forth when the provision was original y enacted included minimizing hardship for
distressed households, lessening the risk that nontax homeownership retention efforts would be
thwarted by tax policy, and assisting in the recoveries of the housing market and overal economy.
Arguments against the exclusion at the time included concerns that it makes debt forgiveness
more attractive for homeowners, which could encourage homeowners to be less responsible about
fulfil ing debt obligations, and concerns about fairness given that the ability to realize the benefits
depends on a variety of factors.210 More recently, because the economy, housing market, and
foreclosure rates have improved significantly since the height of the housing and mortgage
market turmoil (at least prior to the onset of the COVID-19 pandemic), the exclusion may no
longer be warranted.
For more information on the exclusion for canceled mortgage debt, see CRS Report RL34212,
Analysis of the Tax Exclusion for Canceled Mortgage Debt Income.
Deductibility of Mortgage Insurance Premiums
Traditional y, homeowners have been able to deduct the interest paid on their mortgage, as wel as
property taxes they pay, as long as they itemize their tax deductions.211 Beginning in 2007,
homeowners could also deduct qualifying mortgage insurance premiums as a result of the Tax
Relief and Health Care Act of 2006 (P.L. 109-432).212 Specifical y, homeowners could effectively
treat qualifying mortgage insurance premiums as mortgage interest, thus making the premiums
deductible if homeowners itemized and their adjusted gross incomes were below a specified
threshold ($55,000 for single, $110,000 for married filing jointly). Original y, the deduction was
to be available only for 2007, but it was subsequently extended several times.

208 Generally, any type of canceled debt is to be included in a taxpayer’s gross income. Several permanent exceptions to
this general tax treatment of canceled debt exist. T hey are discussed in CRS Report RL34212, Analysis of the Tax
Exclusion for Canceled Mortgage Debt Incom e.
209 For example, canceled mortgage debt is common in a “short sale,” when the lender allows the borrower to sell the
home for less than the remaining amount owed on the mortgage and may forgive the remaining debt.
210 For example, being able to take advantage of the exclusion depends on whether or not a homeowner is able to
negotiate a debt cancelation, the income tax bracket of the taxpayer, and whether or not the taxpayer retains ownership
of the house following the debt cancellation.
211 P.L. 115-97, often referred to as “T he T ax Cuts and Jobs Act,” temporarily changed how homeowners treat
mortgage interest and property taxes for tax years 201 8 through 2025. The deductions are still available but may be
limited for some homeowners.
212 In general, lenders require mortgage insurance for mortgages where the borrower makes a down payment of less
than 20%. Mortgage insurance protects the lender in t he event that the borrower defaults on the mortgage. Mortgage
insurance fees, or premiums, are usually paid by the borrower.
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Two possible rationales for al owing the deduction of mortgage insurance premiums are that it
assisted in the recovery of the housing market, and that it promotes homeownership. The housing
market, however, has largely recovered from the market turmoil of the late 2000s, and it is not
clear that the deduction has an effect on the homeownership rate. To the degree that owner-
occupied housing is over subsidized, extending the deduction could lead to a greater
misal ocation of the resources that are directed toward the housing industry.

Author Information

Katie Jones, Coordinator
Libby Perl
Analyst in Housing Policy
Specialist in Housing Policy

Darryl E. Getter
Elizabeth M. Webster
Specialist in Financial Economics
Analyst in Emergency Management and Disaster

Recovery

Mark P. Keightley
Lida R. Weinstock
Specialist in Economics
Analyst in Macroeconomic Policy

Maggie McCarty

Specialist in Housing Policy

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
shared staff to congressional committees and Members of Congress. It operates solely at the behest of and
under the direction of Congress. Information in a CRS Report should n ot be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in
its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or
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