Press Release

The Enterprise Foundation and National Housing Trust Join Forces to Increase Housing for Poor Families and Seniors

Columbia, MD - In an effort to combat the critical loss of our nation's affordable housing stock, The Enterprise Foundation and the National Housing Trust have joined forces to improve and preserve much-needed housing for working families and our nation's elderly. The new organization will purchase thousands of affordable apartments during the next five years, with the intention of keeping these properties affordable for the next 30 years.

The new organization, NHT/Enterprise Preservation Corporation, will focus on the acquisition of properties that are about to expire under the U.S. Department of Housing and Urban Development's Section 8 program. Section 8 subsidies allow low-income people to rent in selected buildings at a rate equivalent to 30% of their income.

Fueled by low interest rates and the strong economy, many owners of buildings under HUD's Section 8 program are taking their properties "to market." According to National Housing Trust data, over the past 2 1/2 years more than 100,000 of these apartments located in some 48 states have been converted to "market rate," resulting in rent hikes of 50% or more. The result is that tens of thousands of affordable housing units are being lost from the HUD inventory as owners prepay their HUD mortgages or opt out of their Section 8 contracts at a record pace.

The NHT/Enterprise Preservation Corporation wants to give owners another option: selling their Section 8 property to legitimate, competent, nonprofit organizations. Financial institutions have pledged lines of credit to the new entity for the purchase and management of these properties.

"Enterprise and NHT wanted to respond to the opportunities we saw to fill the widening gap in affordable housing by owning and operating housing for poor people," said Bart Harvey, chairman and CEO of the Enterprise Foundation.

"Like an endangered species, this housing is irreplaceable. We are proud to join with Enterprise in attacking what we consider to be America's most serious affordable housing issue" said Michael Bodaken, President of the National Housing Trust.

The need to preserve affordable housing is not in dispute: According to HUD statistics:

• 5.3 million American households suffer worst case housing needs, i.e., pay more than 50% of their income for rent and/or reside in severely distressed housing.
• The number of affordable apartments for very low-income households dropped by 900,000 between 1993 and 1995.
• The number of working poor families needing housing assistance jumped 24% between 1991 and 1995.

Developing and preserving affordable housing for low-income people are key to the missions of The Enterprise Foundation and NHT.

The Enterprise Foundation helps rebuild communities. Working with partners across the country, the Foundation provides low-income people with decent, affordable housing, safe streets and access to jobs and child care. Founded in 1982, this leading national community development organization has raised and invested more than $2.7 billion dollars to help develop nearly 100,000 homes. One Enterprise supporting corporation, Cornerstone Housing Inc., has acquired and redeveloped more than 5,000 apartment units over the last eight years and has transferred many to nonprofit owners who keep those units within reach of low-income people.

The National Housing Trust, founded in 1988, believes that this nation's supply of decent, safe and affordable multifamily housing is a unique national resource. This housing protects and enhances the well being and stability of the families and seniors who call it home and strengthens the communities in which they live. The National Housing Trust's mission is to preserve and improve this housing. The Trust has been responsible for the preservation of approximately 4,000 apartments over the past four years, requiring a combined financial commitment of over $100 million.

For more information, contact Jenny Busanic at the National Housing Trust, 202-333-8931