The Biden administration will award $250 million to developers to create nearly 30,000 units of affordable housing across the country.
On Wednesday, the US Department of the Treasury's Community Development Financial Institutions (CDFI) Fund announced the $246.4 million Capital Magnet Fund award to 48 financial institutions and nonprofit organizations committed to creating thousands of new housing units and community facilities.
The housing units developed under the project would be aimed at low-income families and communities needing "additional investment," the Treasury Department said in a press release.
The developers awarded the grant are tasked with serving the housing needs in all 50 states, the District of Columbia, and territories such as Guam and Puerto Rico.
What the Project Entails
The program is expected to result in 26,400 affordable housing units. Of these, 25,600 will be rental units and 750 will be "homeownership units."
It is presently unclear how much the units will be rented out and who will qualify for the units.
In addition to developing affordable properties, the Biden administration's funding is expected to finance the preservation and rehabilitation of the housing units. It will also enable individuals to purchase affordable housing, the Treasury Department added.
What the Developers Said About the Project
At least 52% of the organizations awarded the grant said they plan to focus a portion of their developments on rural areas. At least 12 organizations said they would allocate 25% of the funding to locations with limited infrastructure compared to suburban areas, per Housing Wire.
The program comes as the US experiences a worsening housing affordability crisis. The median home sale price is $428,281, according to data from Redfin.
The contract rate for the 30-year mortgage also remained elevated at 6.44% while the rate for the 15-year term settled at 5.63% in the week ending Oct. 17, Freddie Mac reported in its Primary Mortgage Market Survey.
The program has created over 63,000 affordable housing units, including more than 55,000 rentals and 7,400 homeowner-occupied units.
