Key Takeaways
- S&P Global Ratings expects affordable housing funding gaps will continue to widen as U.S. Department of Housing and Urban Development support had remained stagnant from political deadlock and budgetary impasses in 2024. Future budgetary cuts could occur as part of Congress’ proposed spending.
- However, social housing provider ratings will remain stable as a result of strategic competence and operational effectiveness of management teams, as many issuers seek to increase revenue amid inflationary expenditure pressures, including rising insurance costs.
- Debt profiles could weaken in the short term as many issuers execute aggressive growth strategies, including preservation of affordable units with Section 8 conversions under the Rental Assistance Demonstration program.
- Opportunities to increase funding for affordable housing may occur through local ballot measures and proposed federal fiscal policy, but ultimately partisan dynamics could shape outcomes.
14 Nov, 2024