Treasury Secretary Janet Yellen is set to announce a series of initiatives aimed at increasing the supply of affordable housing, leveraging existing Treasury Department authorities to help mitigate rising housing costs.
Why it matters: With housing affordability reaching crisis levels, these efforts are designed to alleviate financial pressures on American families and spur economic growth.
Details:
- New Treasury Program: The CDFI Fund will administer a new program, injecting an additional $100 million over the next three years to finance affordable housing projects.
- Interest Rate Predictability: State and local housing finance agencies will benefit from greater interest rate predictability when borrowing from the Federal Financing Bank, facilitating new housing developments.
- Call to Action: Secretary Yellen urged the Federal Home Loan Banks to ramp up their spending on housing programs, highlighting their critical role in addressing the housing shortage.
- How-To Guide: A comprehensive guide will be provided to state and local governments, detailing the effective use of Treasury-provided recovery funds for housing construction.
- Capital Magnet Fund Update: Enhancements to the Capital Magnet Fund will grant greater flexibility to CDFIs and non-profits, enabling them to better finance affordable housing initiatives.
What they’re saying: Yellen will note, “Given the scale of the challenge, we must and will continue to do more,”
The bottom line: These initiatives represent a concerted effort by the Treasury, as part of the Biden Administration, to address housing shortages and reduce costs, leveraging financial tools and partnerships to make a tangible impact on communities across the country.
