South Iowa News

U.S. Representatives Zach Nunn (IA-03) and Wiley Nickel (NC-13) have introduced bipartisan legislation aimed at improving access to housing in rural communities. The Promote Affordable Rural Housing Act seeks to enhance the U.S. Department of Agriculture (USDA) Section 524 loan program by extending the loan term for rural housing site loans and expanding their use.

The need for affordable housing in rural areas of the United States is becoming increasingly urgent. Rep. Nunn recognizes this issue and states, "Our country is suffering from an affordable housing crisis, especially in rural areas. This is a growing challenge that must be addressed now to prevent it from getting any worse. Modernizing the USDA rural housing development loans will help incentivize new construction and bolster affordable housing options in rural Iowa."

According to data, there is a shortage of 7.3 million affordable and available rental homes for low-income renters across the country. In rural Iowa specifically, 10.6 percent of the population lives in poverty, and the average household income is more than $10,000 less than the national average. Additionally, nearly 40 percent of renters in Iowa spend almost one third of their income on housing.

The USDA Section 524 loan program currently offers loans that can be used to purchase and develop housing sites for low-income and moderate-income families. However, the program only allows for a two-year loan term at below-market rate. This limitation poses challenges for non-profits, municipalities, and tribal governments who may struggle to repay the loan within such a short timeframe.

To address these concerns, the Promote Affordable Rural Housing Act proposes extending the loan repayment window from two years to five years. This extension will provide borrowers with increased flexibility and better enable them to meet their repayment obligations. Moreover, the legislation will also allow these loans to be used for additional development projects such as surveys, architecture design, and engineering.

The bill has received significant support and was introduced in the U.S. Senate by Senators Jerry Moran (KS), Amy Klobuchar (MN), and Jeanne Shaheen (NH). It passed the Senate unanimously on January 24, 2024. This bipartisan effort highlights the recognition of the urgent need for affordable housing in rural communities across the nation.

By improving the USDA Section 524 loan program, the Promote Affordable Rural Housing Act aims to address the affordable housing crisis and create more options for low-income and moderate-income families in rural areas. The bill's passage in the Senate is a positive step forward in ensuring that individuals and families in rural communities have access to safe and affordable housing.

Source:

- Rep. Zach Nunn: "Our country is suffering from an affordable housing crisis, especially in rural areas. This is a growing challenge that must be addressed now to prevent it from getting any worse. Modernizing the USDA rural housing development loans will help incentivize new construction and bolster affordable housing options in rural Iowa."