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Horsford, HUD Sec. Fudge slam corporate investors for skyrocketing rents

By ThisIsReno

by Michael Lyle, Nevada Current

Democratic U.S. Rep. Steven Horsford wants to crack down on corporate investors that buy up already limited housing stock, which he said has driven up rents and squeezed out prospective homeowners.  

Horsford joined U.S. Housing and Urban Development Secretary Marcia Fudge on Monday to tour affordable housing complexes in Southern Nevada and speak on federal initiatives being used to combat the housing crisis.  

The congressman touted investments made possible by the American Rescue Plan Act, federal relief dollars that some states, including Nevada, have directed toward affordable housing projects.

And Horsford said some of the rising cost of housing is the result of corporate investors. “I have no problem with some level of adjustments that are reasonable and fair,” Horsford said. “I have a big problem with corporate investors that are gouging consumers and my constituents in the name of profit at a time when we are trying to recover.”

Horsford didn’t offer specifics on how to rein in investors but said he was “looking at a number of initiatives, along with the administration, to figure out what we could do to not continue to allow these corporate investors who have no stake in this community.”

“If we don’t do something about the situation we find ourselves in today with the rising costs not just of homeownership but rent, we are going to create a problem like I saw in (Los Angeles) and San Francisco.”

The Culinary Union, which in May announced a ballot initiative to cap year-to-year rent increases at 5% in North Las Vegas, has also pointed to large, out-of-state, corporations driving up housing costs.   

During the launch of its “Neighborhood Stability” initiative, the union noted that the top 10 apartment owners in Nevada own 26.4% of total available units, the largest being Westland Real Estate Group, a company based in Long Beach, California.  

Horsford, whose congressional district includes North Las Vegas, said corporate investors “don’t care about our community.”

“They’re not worried about who is going to be living in that home next to us,” he said. “They are not even really worried whether or not the unit is going to go on the (rental) market, because some of them are holding it and not making it available to renters or homeowners” in anticipation of selling the property.

Fudge’s visit comes as Nevada, along with the rest of the nation, contends with a deficit of affordable housing units. 

The National Low Income Housing Coalition said no state has an adequate supply of affordable housing for the lowest income renters. 

According to the organization, Nevada lacks more than 97,000 homes for extremely low income renters. 

The state has a deficit of 101,487 homes for people who make at or below 50% of area median income.

Additionally, rents in Southern Nevada have increased around 30% in less than two years. 

“If we don’t do something about the situation we find ourselves in today with the rising costs not just of homeownership but rent, we are going to create a problem like I saw in (Los Angeles) and San Francisco,” Fudge said. “Most of the people sleeping on our streets today are young parents with children and senior citizens. We are judged by how we treat our very young and very old.”

Horsford said the number one complaint his office receives is from people who can’t afford their rising rent.

In an interview, Fudge noted there have already been federal investments in addressing the housing crisis and helping people pay their rent. 

“They passed the American Rescue Plan, they passed the CARES Act, they passed the Covid package. Those resources are here to be used now,” she said. “Right now the American Rescue Plan is putting $350 billion to state and local governments.”

Fudge added the federal bills don’t include ongoing grants HUD administers such as community development block grants, which are federal funds that can help cities develop affordable housing or respond to homelessness.

ARPA, the relief bill signed into law by Pres. Joe Biden in March 2021, has been used by states and local governments to address the housing shortage. The bill was opposed by every congressional Republican, including U.S. Rep. Mark Amodei.

The White House, which released a housing plan in May, has urged states and tribal governments to dedicate ARPA funds to housing projects.

“To date, nearly 570 jurisdictions have committed over $11.7 billion to housing-related activities, with $3.2 billion committed to production and preservation,” according to the White House.

Nevada, which received around $6.7 billion in ARPA funding for state and local governments, is allocating $500 million for the creation and preservation of affordable housing as well as homeowner assistance and land acquisition.

The state is still reviewing applications from developers and nonprofits who could create housing projects. 

Fudge said it’s going to take some time to “build all the housing we need in this country,” but urged communities to put plans in place as quickly as possible to spend the money that is already available. 

“You have to start by making sure you’re ready when the developer is ready,” Fudge said. “So you’ve looked at your zoning, you’ve looked at how people are going to respond to what you’re building, you’ve already got the land acquired or already secured the land. Housing takes time. If you do all the preparatory work and the resources are here, you can hit the ground running.” 

Nevada Current is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Nevada Current maintains editorial independence. Contact Editor Hugh Jackson for questions: [email protected] Follow Nevada Current on Facebook and Twitter.

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