Photo credit: US Consulate Chennai CC
Increasing effectiveness for the next 50 years
New Housing and Urban Development (HUD) Secretary, Julian Castro, spoke at the Bipartisan Policy Center’s Housing Summit in Washington, D.C. He said that he will focus on advancing policies at the nearly 50 year old agency and create a solid foundation for the next 50 years. Castro, the afternoon keynote speaker, wants to build a stronger HUD, which he underlined by starting his speech on internal reforms.
In prepared remarks, Castro said, “Across the country, HUD is providing help and hope. And we’ll spend the next two-and-a-half years expanding opportunity for all Americans. The best place to start is homeownership. In fact, it’s time to remove the stigma associated with promoting homeownership. When done responsibly, it strengthens communities and boosts our economy. It helps families put down roots and secure their financial futures. In short, it’s a cornerstone of the American Dream. By improving the way we do business, we will be able to more effectively deliver on our mission of creating opportunity for all. To do this, we want to focus on four areas of operational improvement.”
Highlights from Castro’s prepared materials
Effectiveness evidence
“In this tight budget environment, we’ve got to make a powerful case for resources. The best way to make the case is by measuring our outcomes and using data to guide our work. We’ve got to show our stakeholders that what we’re doing works and deserves investment. Evidence-based work also shows us what’s not working, giving us the information we need to make adjustments or, if appropriate, change course.”
The need for transparency
“Transparency is good for productivity and morale. We must make every effort to let the HUD team know when and why we are making decisions, as well as encourage employees to offer ideas-through Switchboard, to supervisors and more-to make HUD an even better place to work.”
Castro understands the challenges facing mortgage financing.
“With all our efforts, I want to send a simple message to lenders: let’s work together. We share a common interest: to see a robust, healthy housing market where those who are ready can buy a home – from the millennial starting out, to the veteran returning from the battlefield, to the couple expecting their first child,” Castro said. “We can advance this interest and move our nation forward — but that takes partnership.”
Castro touched on GSE reform.
“A government-dominated market is unsustainable. Instead, we need to attract private capital back to the market, establish certainty for lenders, and protect taxpayers for the future. The bipartisan passage of Johnson-Crapo in the Senate Banking Committee was a huge step forward. Now we must keep pushing until housing reform legislation gets over the finish line — once and for all. In the meantime, we must do all we can to get capital flowing again,” Castro said.
He said that he wants HUD to alleviate any uncertainty rather than to add to it.
“Many have been reluctant to lend because they fear unanticipated consequences. They need to be able to manage their risk better – and so does FHA. So we’re making it easier to do business with us by overhauling our ‘Single Family Handbook,’” Castro said. “It brings together 900 mortgagee letters and other policy guidance into a single document. By the end of this month we will publish our first section — loan origination through endorsement.”
Castro acknowledged that challenges in the area of rental housing exist and need to be addressed. Saying that in 2012, more than half of renters were paying more than 30 percent of their income on monthly rent. He said that in order for HUD to meet this challenge, innovative ways must be found to create and preserve affordable rental housing in safe communities.
See The Rise in Single Family Rental Investing
See Rental Affordability – A Hushed American Crisis
Castro spoke on HUD’s continuing commitment to working with federal, state and local entities to end homelessness.
“We’ve made tremendous progress in recent years, including a 16% drop in chronic homelessness and a 33% drop in veteran homelessness.”
He tackled HUD focusing on urban community development.
“So we’re bringing new life to HUD initiatives that boost access to knowledge and employment. Later this month, we’ll award $75 million to nearly 750 Public Housing Authorities to connect residents with the education and job opportunities they need to build assets and improve their lives.
Resources:
HousingWire. New HUD Secretary outlines his vision for last years of Obama Administration
National Mortgage Professional. New HUD Head Castro Pushes Nationwide Homeownership