During the housing boom of the late 1990s until the bubble burst in 2008, the Clinton and Bush Administrations boasted that record numbers of Americans were homeowners, particularly citing increases among minority homeowners. The “American Dream” was finally being realized under their watch, and lenders were definitely along for the ride. It was as if the mortgage market turned into “The Price is Right,” and anyone could come on down be approved for a loan. As the housing bubble began to burst, starting with buyers in the subprime market, the rest of the economy became affected and spiraled in a downward trend.

Some of those who experienced the “American Dream” under Presidents Clinton and Bush turned a blind eye, just as lenders did during this time, and thought they could afford to own a home. People with shoddy credit were suddenly being approved at alarming rates. Not surprisingly they began to fall behind on their payments, leading to a record number of foreclosures. As the economy has worsened, people have lost their homes for a variety of reasons: unemployment, lack of housing counseling, sickness, and other economic pressures.

Since passage of the Housing Economic Recovery Act of 2008 (HERA) in July of 2008, Congress has struggled with how best to address the housing market. Most of their focus has been on stabilizing the market for homeownership as opposed to rental programs and homelessness issues, the two latter issues should be more greatly dealt with. While I would argue that homeownership is more of a right that someone eventually achieves, everyone should have access to shelter. Renters are a population that seemed to have been lost in the shuffle of foreclosures, although many were just as affected by foreclosed rental properties that their landlords fell behind on the payments.

There are more foreclosed properties sitting empty than at any other time in America’s history. Most of these remain for a potential homebuyer. Thousands of homes that have been foreclosed upon could be turned into rental projects with guidance from HUD, Fannie Mae, Freddie Mac, Veterans’ Affairs, USDA, and the FDIC. The FDIC in particular is selling foreclosed property in bulk, without restrictions. There should be more of an effort to develop some of these foreclosed multifamily units into rentals.  

Due to the greater economic woes and increasing unemployment numbers, more Americans are being forced to live within or below their means to save money. This is creating competition for rental units and in turn pushing those with even less resources from the units they can afford. The very- and extremely-low income families and individuals are now facing living in shelters or homelessness. Especially in the development of multi-family units, personal Section 8 vouchers should be accepted. Funding for the Section 8 voucher program has been stagnant and many cities face waiting lists of over five years.

There is a program that could prove critical in the development of housing for the extremely- and very-low income populations and could help provide a much-needed increase in rental housing stock. The National Housing Trust Fund was established with the passage of HERA in 2008, however it has not yet received any funding. Its initial source of funds, as passed, was a percentage of business from Fannie and Freddie. Since those two GSEs have been held in government conservatorship since the fall of 2008, Congress needs to explore other possible funding streams. There is a one-time capitalization of $1 billion for the NHTF included in a tax extenders bill currently being considered by Congress. Additionally, $65 million would be included for project-based vouchers. Along with capital grants, this infusion of critical funding could lead to the creation of 10,000 new rental units.

Funding the NHTF is just part of the solution. Homelessness, especially amongst veterans, continues to spiral. Government agencies should work together to ensure all is being done to help curb the increasing numbers on the street and in the shelters. The VA, HUD, USDA, GSEs, and FDIC should help not only potential homeowners, but also potential renters. They should invest more in housing counseling, to educate people on the process of buying a home, more stock should be placed in renting-to-own programs.

Now that we have celebrated Memorial Day weekend with a paid vacation day and countless BBQs, let us not forget about the veterans who fought bravely and returned to a home they couldn’t afford and ended up on the streets. The American Dream may not include owning a home for some, but it should include access to shelter for everyone.