Real Estate Development

At The CED Doctor, we believe affordable housing is an inherent right and not a privilege.  Every person should have access to clean, safe, decent, and affordable housing options.  The government must facilitate the development of affordable housing and there are various programs that can help non-profits, investors, and developers build housing that is affordable.  Here are just a few affordable housing programs The CED Doctor can help you access.


Low Income Housing Tax Credit (LIHTC) Program

The Low-Income Housing Tax Credit (LIHTC) program has provided critical financing for more than 2 million rental homes.   Affordable housing is more complex than ever before.  Most properties require the use of low-income housing tax credits plus several additional subsidies to be viable.  The LIHTC program effectively uses tax policy to help develop affordable rental housing for low and very low-income families. Originally part of the Tax Reform Act of 1986, the LIHTC program leverages private capital and investor equity to support the development of new and rehabilitated affordable rental housing. The credits are competitively priced. In general, state governments can adapt the LIHTC program to meet their housing needs under broad federal guidelines. In addition, the private sector carries all development and marketing risks and enforces strong oversight and accountability.

The federal government funds the LIHTC program.

  • The U.S. Department of the Treasury issues tax credits to state governments and requires that LIHTC-funded housing stays affordable for at least 30 years.
  • In 2009, for example, each state received a maximum of $2.30 per resident.

Individual states largely control what housing gets built.

  • States control the type and location of the housing built and other relevant characteristics to best serve low and very low-income residents.

Developers apply for competitive tax credits.

  • State agencies write regulations (called “qualified allocation plans” or “QAPs”) describing how developers will be selected and open the competition for credits.
  • The agencies review and rate the developers’ applications and award the tax credit allocations to the most qualified developer(s).

Developers get funds for construction.

  • Enterprise and other companies (called “fund managers” or “syndicators”) create funds to pool investor capital.
  • Syndicators then use these funds to purchase the tax credits from the developer in exchange for an equity stake in the housing development.
  • With capital from investors, developers can limit the amount of money they borrow to fund construction, which reduces the developers’ debt and keeps rent affordable.
  • Low-income families rent an affordable home.
  • LIHTC properties can only be rented to families whose income is at or less than 60 percent of the area median income.
  • Tenants’ rent payments are limited to 30 percent of their income.
  • Investors purchase a 10-year tax credit.
  • The equity stake in the housing developments that investors receive provides competitive yields.
  • Investors help to revitalize the communities in which they work and live.
To download:
  • The January 2011 version of the 8823 Audit Guide, click on AUDIT GUIDE.
  • HUD’s most recent announcement on the effective passbook rate when calculating a household’s income from assets, click on PASSBOOK RATE.
  • HUD’s notice on resident protections in LIHTC projects, click on RESIDENTS.


The HOME Program

On July 24, 2013, HUD issued the new final rule for the HOME program.  This represented the first major update to the HOME program in 17 years.  It included changes impacting all components of the program, including basic program administration.  On this page, we focus on information regarding changes that impact rental housing development, rental housing compliance, and community housing development organizations (CHDOs).
To download:
  • HUD’s most recent HOME FAQs, click on HOME FAQS.
  • CPD Notice 14-08 – Operational Guidance for 2012/2013 Projects, click on NOTICE 14-08.
Regarding CHDOs, to download:
  • Information on CHDO roles in the final rule, click on CHDO ROLES.
  • The CHDO Toolbox for HOME, download TOOLBOX.
  • Information on assessing CHDO capacity, click on CHDO CAPACITY.


Housing Trust Fund (HTF)

On March 26, 2015, the Federal Housing Finance Agency (FHFA) published a final rule for the Housing Trust Fund (HTF). In it, they prohibited Fannie Mae and Freddie Mac from passing the costs associated with their contributions to the HTF to the originators of loans they purchase or securitize. They also finalized the program’s interim rule without change.

The HTF was established under the Housing and Economic Recovery Act of 2008 (HERA) to provide grants to state governments to increase and preserve the supply of rental housing and homeownership opportunities for extremely low and very low-income households. HUD plans to open its rules for public comments once the states gain experience administering the program.

To download:

The HTF final rule, click on HTF Final Rule.

The HTF interim rule, click on HTF Interim Rule.
The chart comparing HOME requirements to those for the HTF, click on HOME vs HTF Chart.