HUD/Section 8 multifamily assets
Anyone have good knowledge of Affordable housing as it relates to the ongoing situation. Logic makes me think that since the government was already subsidizing most or all of the tenants rents, these assets are the least likely to take a big hit. Looking for responses with those who have been keeping tabs on these assets. Thanks.
[{"id": "flks9lw", "text": "Just my thought, not having researched or dug too deep, but I agree on the logic. It seems section 8 properties, or those properties with more section 8 vouchers MAY stand to lose less rent since varying portions are paid by the government. \n\nHit hardest will probably be \u201cnaturally occurring\u201d affordable housing where there is no real subsidies or program in place, rather the rents are \u201caffordable\u201d due to the condition, age or location of the property. My assumption is those properties will have large percentages of residents who have already lost their jobs. \n\nFirst few days of April will be very telling.", "replies": [{"id": "fll99bn", "text": "LIHTC deals will be hit.", "replies": [{"id": "flljph3", "text": "Care to elaborate?\n\nIs this in regards to deals getting done or the bottom line of these properties?", "replies": [{"id": "flnjq3v", "text": "Credits values are changing. $1 isn\u2019t worth $0.XX anymore. Underwritings will have to adjust and blow up deals", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "flldixt", "text": "None of my 60 residents have notified me of an inability to pay.", "replies": [{"id": "flmf8p4", "text": "I feel like the average tenant in \"naturally occuring\" affordable housing is more than likely just going to let the cheque bounce.", "replies": [{"id": "flmhydw", "text": "All my residents are on some sort of government income ssi, dshs, et al. Nothing really has changed in their lives.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fllfqcd", "text": "HUD was one of - if not the - biggest lenders throughout the last downturn, and as you said, voucher tenants are subsidized by the government.  I have a client who\u2019s panicking and considering unloading his entire portfolio, save for his affordable assets because he knows his delinquency risk is more limited.", "replies": [], "depth": 1}, {"id": "flnjv7v", "text": "I think general 60% AMI affordable has extremely high risk. As in the non designated HAP/Voucher product. They\u2019re not directly Subsidized so you\u2019ll end up with a concentrated exposure to wage earners.", "replies": [], "depth": 1}]