lihtc in middle appalachia - cahec...» in line with the percentage of the national population in...
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LIHTC in Middle Appalachia
Corey Aber, Director of Community Mission & Impact Finance
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© Freddie Mac 2
A Better Freddie Mac …and a better housing finance system
For families
...innovating to improve the liquidity, stability and
affordability of mortgage markets
For customers
...competing to earn their business
For taxpayers
...reducing their exposure to mortgage risks
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© Freddie Mac 3
▪ Rural Middle Appalachia Market
▪ LIHTC in Rural Middle Appalachia
▪ Freddie Mac’s Investment
Agenda
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© Freddie Mac 4
Rural Middle Appalachia per Duty to Serve
Population:
5.4 Million(1.7% of the U.S.)
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© Freddie Mac 5
Overview of the Rural Middle Appalachia Market
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© Freddie Mac 6
Population Distribution by State
▪ LIHTC properties serve ~27% of renter households in the
region
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© Freddie Mac 7
Homeownership Dominates
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© Freddie Mac 8
SFRs and MH Supply the Majority of Rental
SFR60%
Mobile Homes23%
Multifamily17%
There are ~563,000 renter households in rural Middle Appalachia
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© Freddie Mac 9
Contextualizing All Rental Property Sizes
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© Freddie Mac 10
Renter Income is Lower Than Owner Income
▪ Renter income is significantly lower than the national average
▪ 47.9% of renters pay 30% or more on rent, while 24.6% pay
more than 50%
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© Freddie Mac 11
LIHTC in Rural Middle Appalachia
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© Freddie Mac 12
LIHTC Serves a Great Need
▪ 656 LIHTC properties with 25,236 LIHTC units in the region
▪ LIHTC properties serve ~27% of renter households in the region
▪ The average LIHTC property is 39 units, compared to 75 nationally
▪ Average of less than 2% of all LIHTC allocations go to the region each
year
» There are approximately 25 LIHTC allocations per year to the region out of
1,350 nationally (1.8%) over the past 20 years
» This supports an average of 1,060 units per year
» In line with the percentage of the national population in the region (1.7%)
▪ Location Matters
» 261 (39.8 percent) of the region’s LIHTC properties are located within 2
miles of an interstate and 395 (60.2 percent) are within 5 miles
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© Freddie Mac 13
LIHTC Serves a Great Need
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© Freddie Mac 14
Credit Usage: National v. Rural Middle
Appalachia
9% Credits
43%
4% Credits
43%
Both14%
9% Credits
44%
4% Credits
30%
Both26%
National Rural Middle Appalachia
Source: Freddie Mac Tabulations of National Housing Preservation Database. Percentages calculated based on LIHTC units.
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© Freddie Mac 15
Other Subsidies Play an Important Role
▪ 372 of 656 LIHTC properties are supported by other
subsidies
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© Freddie Mac 16
USDA 515 Also Has a Large Role
▪ There are 620 USDA 515 properties supporting 20,248
renter households
▪ 256 properties and 8,826 units also have LIHTC support
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© Freddie Mac 17
Freddie Mac’s Investment
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© Freddie Mac 18
Duty to Serve Markets for LIHTC – All Rural
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© Freddie Mac 19
Duty to Serve Markets for LIHTC – High Needs
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© Freddie Mac 20
Freddie Mac LIHTC Investments