B+A New Jersey

Continued from Page 44 lifestyle — have been attracting significant interest. New move-ins have been taking advantage of multimonth free rent/free utilities offers, while residents have been recruiting new neighbors thanks to a referral incentive program. The result: a steady flow of income- eligible candidates. The Art of LITC Financing In 2012, $7 billion in new LITCs are expected to flow into the nation's investor market. Tax reform and banking regulations, including changes in Community Reinvestment Act (CRA) require- ments, are expected to enhance equity pricing. As banks continue to dominate the marketplace, amendments to the CRA regulations will allow banks to invest in larger geographic areas, resulting in a nar- rowing of the credit-pricing gap in historically low-priced non-CRA areas. It is not unusual to see a 10 cent-per-credit differential between a high-priced CRA area and a nonCRA-qualified area. Although the tax-credit market has not been attracting new investors at the same pace as the market rate sector, current and past players are expected to continue their levels of buying activity. However, industry experts are keeping a watchful eye on insurance companies and nonCRA-obligated entities. In a sector with yields on investment at or below 6%, these investors may decide to withdraw from the LITC market, prompting additional downward pressure on pricing in 2012. If this scenario plays out, the LITC sector may stall once again, just as it did in 2008 and 2009 before the federal stimulus package aborted a virtual industry collapse. Based on the current tenor in Washington, D.C., a second stimulus is highly unlikely. Therefore, states lacking supplemental grant money to add to LITC proceeds will basically only see acquisition and rehabilitation of existing housing stock, at best. In the development community, all eyes are on Washington and pending legislation, including S.1989, a bill proposing the amendment of the IRS Code of 1986 and extension of the fixed value for the 9% tax credit. Without the fixed value, properties under development will need to scramble to be placed in service before December 2013. Projects that miss this deadline could experience significant shortfalls in their development sources to complete construction. The extension of the fixed 9% value will ensure the financial viability of these projects, many of which are slated to begin construction this spring. There is no doubt that 2012 presents its own unique set of obstacles — and guessing game — for low-income renters, as well as developers. Although demand continues to be strong for affordable rental units, supply may be considerably affected by tax policy and regulatory reforms. In this market segment, the law of supply and demand cannot function without considerable government manipulation and private-sector profits. Christiana Foglio is the founder and Chief Executive Officer of Community Investment Strategies, Inc. n 46 | Greater New Jersey Builder+Architect NEWJERSEY.BUILDERARCHITECT.COM CONGRATULATIONS! J.COSTANTIN ARCHITECTURE LLC ADVERTISERS' INDEX AdvanTech ............................................................................................27 Atlantic Builders Convention ................................................................32 Barbara Ostrom Associates ...................................................................31 Chopra Financial Consulting, LLC .........................................................38 Clem's Ornamental Iron Works, Inc. .....................................................40 Design 446 .............................................................................................6 Diane Boyer Interiors,LLC ......................................................................46 Diane Durocher Interiors .......................................................................36 Fiorenza Construction ...........................................................................37 GE ........................................................................................................34 Hardware Designs Inc. ..........................................................................29 Hill Wallack LLP .....................................................................................41 International Dimensional Stone LLC ....................................................38 J. Costantin Architecture ........................................................................8 John Martinelli Photography, Inc ...........................................................39 John Wright Designs .............................................................................45 La Jolie Maison .....................................................................................29 Liquidscapes .................................................................Inside Front Cover Mobility Elevator & Lift Co. .....................................................................5 NorthernLights ............................................................. Inside Back Cover P.C. Richard & Son ................................................................................25 Peter Salerno, Inc. .................................................................................24 Pinnacle ................................................................................................42 Polo Master Builders ...............................................................................7 Sage Design Studio...............................................................................45 Salmon Construction Service, LLC ........................................................43 Southend Building Products .................................................... Back Cover Statile & Todd .......................................................................................44 V&J Construction Co., Inc. ....................................................................37 Warshauer Electric Supply .....................................................................35 Wilbo Builders ......................................................................................33 HOUSING PERSPECTIVE

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