Report on Multifamily Preservation Activities

A LETTER FROM THE EXECUTIVE DIRECTOR

Date: December 4, 2001
To: Members of the Commission and other interested parties
Subject: Multifamily Preservation Study

The Washington State Housing Finance Commission completed the attached preservation study on affordable housing in November of 2001.  This report examined existing affordable housing properties financed in Washington State during the past 25 years by three major programs: the HUD project-based Section 8 program; the Low Income Housing Tax Credit program; and the USDA Rural Development program.  Together, these three programs have financed over 50,000 units in over 1,200 properties of affordable housing throughout the state. 

Unfortunately, affordability contracts on these properties have already begun to expire and some units are converting to market rate.  The remaining units will not stay affordable unless public and private entities find creative ways to refinance, rehabilitate, acquire and manage them for extended terms. 

The purpose of our study was to identify where the properties are located, when affordability contracts will expire and what restrictions from other public funders are present that may keep individual properties affordable. 

Why is this important?  We determined a few years ago, that with current limitations on public funding available for affordable housing, we must find ways to target our funds to the properties and areas with the greatest need.  This report is intended to assist all public funding agencies in an effort to target our resources to save these properties. 

How many units have been lost so far?  The good news is that according to our information only about 1,700 Section 8 units have been lost to market rate, while over 12,800 have renewed affordability contracts.  And so far, no Rural Development or Tax Credit properties have been lost to market rate.

However, the next few years are critical in preservation.  We must find ways to balance our financing of new construction versus rehabilitation of existing properties in an effort to construct and save the maximum number of properties and affordable units we can.   And we must do this, because these statistical numbers represent affordable homes for over 50,000 families throughout our state.

Thank you for taking the time to read this report.

Sincerely,
Kim Herman
Executive Director