David A. Smith Author Archives

Unless Congress and the Administration extend it, the New Markets Tax Credit will die at year-end. While reprieve is likely, to paraphrase noted investment banker Dr. Samuel Johnson, nothing so concentrates the mind as the knowledge that one might be sunset.

A philosophical feud over the soul of affordability that has been ongoing for most of a century may have reached a turning point.

With the mid-September release of Treasury’s Housing Reform Plan, the administration has presented its exit strategy for GSE conservatorship, which may be summarized as ‘death sentence commuted, eligible for parole in a few years,’ and mapped out a strategy to do exactly that without legislation.

Thirty years ago, when I and others were inventing affordable housing preservation, it came in only two flavors (ELIHPA and LIHPRHA), just like Coke and Diet Coke.

In late June, to absolutely no press coverage, a Presidential executive order established the “White House Council on Eliminating Regulatory Barriers to Affordable Housing” with a pointed observation:

People Versus Places: The Definitive Argument

As Michael Milken discovered, one can rue forever giving a good idea the wrong name, for even if it does not sour the public, the wrong name sends the innovators chasing the wrong direction and solving the wrong problem.

If my instincts are correct, a seven page complaint filed on March 28, 2019, HUD v. Facebook, may one day be seen as an industry-disrupting legal event on par with U.S. v. Microsoft (1998) and U.S. v. IBM (1969). HUD accuses Facebook of violating the Fair Housing Act’s prohibitions on discrimination:

In 1975, the year I got into this business, American residential rental housing was split into three utterly separate domains.

Over the last eight years, California’s Bay Area added 167,000 new homes, while adding four times as many jobs: 750,000. Yet when voters were asked to explain the causes of California’s runaway unaffordability, the worst in the nation, they cited lack of rent control first; restrictive zoning came in last.

Many executives I know and respect are afflicted with what I’ve dubbed the perception of essentiality – the belief that not only is their work broadly essential to the organization, each element of how they do it is likewise essential and personal, else the organization suffers.

Finance is not subsidy, though they are easily confused in people’s minds. Affordable housing always needs subsidy in one form or another – so why the recent fascination with state and local housing bonds?