U.S. Department of Housing and Urban Development - 1930-2010

the 1930s

Amidst widespread unemployment and financial collapse resulting from the 1929 stock market crash, Congress passed the Emergency Relief and Construction Act of 1932, creating the Reconstruction Finance Corporation (RFC) and authorizing loans to private corporations providing housing for low-income families. As the Great Depression eased somewhat and the prospect of improved financial status for individual families increased, the National Housing Act of 1934 was passed to relieve unemployment and stimulate the release of private credit in the hands of banks and lending institutions for home repairs and construction. This law also created the Federal Housing Administration (FHA), the main federal agency handling mortgage insurance. The FHA's assumption of risk, through its insurance programs, made possible the amortization of mortgage loans with regular monthly payments and a secondary market for home mortgages, thus freeing up funds for home loans. In 1938, the Federal National Mortgage Association (Fannie Mae) was chartered by the FHA as a subsidiary of the RFC. These early measures stimulated housing construction, and the United States Housing Act of 1937 authorized loans to local public housing agencies for lower-rent public housing construction expenses.

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the 1940s

World War II caused a temporary moratorium on U.S. domestic housing construction, except for defense purposes. Legislation during this period, however, had a major impact on housing. The 1944 authorization of the Veterans Administration (VA) home loan program guaranteed millions of single-family and mobile home loans. The increase in housing construction following World War II, which led to the growth of suburban areas, is in part attributable to this financing program. The exodus to the suburbs led to new housing programs for declining urban areas authorized by the Housing Act of 1949. The Act authorized funds to localities to assist in slum clearance and urban redevelopment, new construction, and activities not directly related to housing construction (open space land, neighborhood facilities, and basic water and sewer facilities).

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the 1950s

The Housing Act of 1954 amended that of 1949 to provide funding, not just for new construction and demolition, but also for the rehabilitation and conservation of deteriorating areas. This began a gradual shift in emphasis from new construction to conservation, now reflected in current housing policies that encourage rehabilitation. With the 1954 amendment, the term "urban renewal" was expanded to refer to public efforts to revitalize aging and decaying inner cities and some suburban communities.

The Housing Act of 1956 added special provisions under Sections 203 and 207 and the public housing programs to give preference to the elderly, and amended the 1949 Act to authorize relocation payments to persons displaced by urban renewal. Federal involvement in housing rapidly expanded to include the financing of new construction, measures to preserve existing housing resources, and urban renewal.

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the 1960s

Executive Order 11063, Equal Opportunity in Housing, issued in 1962, represented the first major federal effort to apply civil rights to housing. Title VII of the Civil Rights Act of 1964 assured nondiscrimination in federally assisted programs. Equality in housing opportunity was legislated by Title VIII of the Civil Rights Act of 1968, the Fair Housing Act, which prohibited discrimination in the sale, rental, and financing of housing. The Housing and Urban Development Act of 1965 created HUD as a cabinet-level agency and initiated a leased housing program to make privately owned housing available to low-income families.

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the 1970s

The 1970s was a decade of housing policy enterprises meant to eliminate the hazards of lead-based paint poisoning in existing housing; protect the rights of consumers in the areas of interstate land sales and real estate settlement procedures; discourage geographical discrimination in the mortgage lending industry; provide communities with resources to address a wide range of unique development needs; and supply rental subsidies to eligible tenants residing in newly constructed, rehabilitated, and existing rental and cooperative apartment projects (Section 8 Voucher program).

In January 1973, President Nixon declared an 18-month moratorium on approvals for subsidized housing programs, including Sections 235 and 236. The moratorium also applied (as of July 1) to funding for urban renewal, Model Cities, and FHA programs. The moratorium was rescinded in the summer of 1974.

HUD's Office of Policy Development and Research (PD&R) was created in 1973 and tasked with conducting research on priority housing and community development issues. Features of PD&R's new research program included the American Housing Survey, a regularly maintained database on the characteristics of the nation's housing stock, and the Partnership for Advancing Technologies in Housing Initiatives that identified techniques for building more affordable, durable, disaster-resistant, safe, and energy-efficient housing. PD&R's vehicle for distributing relevant research and information, HUD USER, was launched in 1978 and today is a multi-media resource for housing stakeholders.

PD&R generated a wealth of housing studies during this era.

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the 1980s

The 1980s began with changes in the rules governing thrift institutions and expanding alternative mortgages. It was a time of retrenchment in HUD-funded housing construction programs. Budgetary constraints eliminated Section 8 New Construction and Substantial Rehabilitation programs, but the Section 8 Voucher Demonstration, the Housing Development Action Grant, and Rental Rehabilitation programs were implemented by the Housing and Urban-Rural Recovery Act of 1983. Other significant measures to ensure housing opportunities for all addressed the housing needs of Native Americans and Alaskan Indians and the homeless. The Low-Income Housing Tax Credits (LIHTC) program created affordable housing opportunities for low- and moderate-income families. The scope of fair housing provisions of the Civil Rights Act of 1968 was expanded, giving HUD additional enforcement responsibilities.

Significant research was produced by PD&R during this decade.

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the 1990s

Crises characterized the 1990s, much of which related to the cost of expiring Section 8 contracts and deteriorating properties. Several new programs were designed to ensure survival of affordable units and the viability of subsidized housing programs. The Low-Income Housing Preservation and Resident Homeownership Act of 1990 attempted to maintain the supply of affordable housing by offering project incentives to preserve low-income rental properties. HUD faced the high cost of renewing expiring Section 8 contracts. At the crux of the problem, the high cost of FHA-insured mortgages necessitated higher than market-rate rents, making HUD Section 8 subsidies extremely expensive. The Multifamily Assisted Housing Reform and Affordability Act of 1997 restructured these mortgages in order to maintain affordable Section 8 subsidies. HUD was also beset by budgetary pressures and streamlined itself through significant staff cuts, reorganizing operations, and program consolidation.

PD&R continued to facilitate housing research and evaluation activity that would lead to informed decisions on HUD policies, programs, and budget and legislative proposals.

PD&R-sponsored research during this decade was prolific.

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the 2000s

America's homeownership rate reached a new record-high of 69 percent in 2004. HUD worked with public agencies, private partners, nonprofit, faith-based, and community organizations to expand the availability of affordable housing, to improve structural and living conditions in HUD-insured and assisted rental housing projects, and to maintain a commitment to wider affordable rental housing opportunities. The Department led a major consumer advocacy initiative to reform outdated and needlessly complex regulatory requirements under the Real Estate Settlement Procedures Act (RESPA). Impetus was also given to sponsoring targeted programs that provided housing and other essential support to special need populations, such as the elderly, persons with disabilities, individuals with HIV/AIDS, and the homeless.

Housing prices peaked in early 2005 and began to decline in the following year. Increased foreclosure rates among U.S. homeowners led to a crisis that adversely effected home valuations and reverberated throughout the nation's mortgage markets, Wall Street hedge fund investments, and the industries of home building, real estate, retail home supply, and banking. The Housing and Economic Recovery Act of 2008 (HERA) strengthened and modernized the regulation of Fannie Mae and Freddie Mac (government-sponsored enterprises) and the Federal Home Loan Banks. It created a new program at FHA to help families save their homes from foreclosure and established the Neighborhood Stabilization Program with grants for stabilizing communities suffering from foreclosures and abandonment with the purchase and redevelopment of foreclosed and abandoned homes and residential properties.

Efforts to alleviate the stress on households and communities, caused by the foreclosure crisis and the recession, were extended in 2009 with passage of the American Recovery and Reinvestment Act, the Hearth Act, and Helping Families Save Their Homes Act.

PD&R's research program produced significant analyses on a wide range of housing issues that reflected HUD's priorities.

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the 2010s

The decade of the 2010’s in housing began with the recovery from the 2007-2008 economic crisis and mortgage market collapse. Total housing starts (single- and multifamily) remained below one million units per year, well below the pre-crisis levels of over 2 million. FHA played a greatly increased role in assisting private lenders to continue to issue mortgage financing with the share or mortgages with FHA insurance rising to over one-third of the market. While Congress debated further potential reforms for the secondary market, Fannie and Freddie remained in federal conservatorship but took on a larger role in stabilizing the market after Wall Street firms retreated from issuing mortgage securities.

At HUD, the Obama Administration placed a renewed emphasis on affordable rental housing policy, implementing the Choice Neighborhoods Initiative and the Rental Assistance Demonstration aimed at recapitalizing the existing assisted rental stock. There was a renewed emphasis on placed based and comprehensive neighborhood revitalization while increasing mobility options for lower-income families, as well as improved coordination between programs at different federal agencies with similar goals for improving neighborhoods.

HUD also joined with the Veterans Administration to announce a goal of ending homelessness among America’s veterans. Major decreases in veterans’ homelessness were achieved as new program responses received support, including the HUD-VA Supportive Housing (HUD-VASH) program and VA’s Supportive Services for Veteran Families program.

And HUD played a lead role in the federal task force and providing assistance to the northeast states to rebuild from the devastation caused by Hurricane Sandy in 2012.

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PD&R, “Report to Congress on the Root Causes of the Foreclosure Crisis,” (January 2010). http://www.huduser.gov/portal/publications/hsgfin/foreclosure_09.html

“Hurricane Sandy Rebuilding Strategy,” Hurricane Sandy Rebuilding Task Force (August 2013)

“HUD FY 2010 Budget: Road Map for Transformation” available at http://portal.hud.gov/hudportal/HUD?src=/program_offices/cfo/reports/cforept