On Monday, the Treasury Department declared that it will allocate $100 million over the next three years to finance a new initiative aimed at augmenting the supply of affordable housing throughout the nation.
The Community Development Financial Institutions Fund has recently launched a new program aimed at providing financial support for the development of thousands of affordable housing units. This program is set to make a significant impact in the housing sector by making it easier for individuals and families to access affordable housing options.
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According to a statement released by the Treasury Department, this program has the potential to significantly decrease costs for housing finance agencies. It enables them to borrow funds at rates similar to those of the U.S. government, resulting in a considerable reduction in costs. The statement further added that the extension of this program is expected to create a preserve of approximately 38,000 new rental homes over the next decade.
During an event in Minneapolis on Monday, Treasury Secretary Janet Yellen is anticipated to discuss the Biden administration’s plan to reduce the cost of living by lowering housing expenses.
Yellen stated in her prepared remarks that inflation has decreased by almost two-thirds from its peak. She acknowledged that while prices for essential household expenses such as healthcare, energy, and housing remain high, President Biden and herself recognize that these challenges have been accumulating over several decades.
The President has prioritized making life more affordable for every citizen, and his administration has been actively working towards achieving this goal through a comprehensive affordability agenda. The primary focus of this agenda is to tackle the rising price pressures that families have been experiencing, thereby easing their financial burden.
In an effort to boost housing programs, Yellen has requested that the 11 Federal Home Loan Banks double their required commitment of net income from 10% to 20%. The focus will be placed on new construction and the request is voluntary.
According to the Treasury Department, had the Federal Home Loan Banks (FHLBs) shown this level of dedication in the past five years, they would have provided nearly $2 billion more than the legally required amount to housing programs.
