On today’s episode of Power House, Diego sits down with Marietta Rodriguez, President and CEO of NeighborWorks America, to talk about their mission to expand affordable housing across the nation.
NeighborWorks America is a congressionally chartered nonprofit that supports a network of community organizations that develop rental and homeownership opportunities for low-income households.
Marietta shares how the organization ranks among the top 100 homebuilders across the US, talks about the dynamics of urban vs. rural housing, and why solutions like modular construction should be popularized. She also talks about building community trust to overcome NIMBY challenges and how NeighborWorks maintains bipartisan support in a politically divided landscape.
Here’s what you’ll learn:
NeighborWorks America was created to combat urban disinvestment.
The organization supports a network of nonprofits focused on housing and community development.
They provide grants, training, and technical assistance to local organizations.
NeighborWorks is a significant player in the affordable housing market.
Community trust helps overcome NIMBY challenges in housing development.
Rural housing issues require different strategies compared to urban challenges.
Related to this episode:
NeighborWorks America
https://www.neighborworks.org/
How a housing nonprofit survives the age of DOGE | HousingWire
https://www.housingwire.com/articles/neighborworks-america-housing-nonprofit-doge-affordable-homeownership/
Marietta Rodriguez | LinkedIn
https://www.linkedin.com/in/marietta-rodriguez
Marietta Rodriguez | FDIC.gov
https://www.fdic.gov/advisory-committees/marietta-rodriguez
Enjoy the episode!
The Power House podcast brings the biggest names in housing to answer hard-hitting questions about industry trends, operational and growth strategy, and leadership. Join HousingWire president Diego Sanchez every Thursday morning for candid conversations with industry leaders to learn how they’re differentiating themselves from the competition. Hosted and produced by the HousingWire Content Studio.
NeighborWorks America is a congressionally chartered nonprofit that supports a network of community organizations that develop rental and homeownership opportunities for low-income households.
Marietta shares how the organization ranks among the top 100 homebuilders across the US, talks about the dynamics of urban vs. rural housing, and why solutions like modular construction should be popularized. She also talks about building community trust to overcome NIMBY challenges and how NeighborWorks maintains bipartisan support in a politically divided landscape.
Here’s what you’ll learn:
NeighborWorks America was created to combat urban disinvestment.
The organization supports a network of nonprofits focused on housing and community development.
They provide grants, training, and technical assistance to local organizations.
NeighborWorks is a significant player in the affordable housing market.
Community trust helps overcome NIMBY challenges in housing development.
Rural housing issues require different strategies compared to urban challenges.
Related to this episode:
NeighborWorks America
https://www.neighborworks.org/
How a housing nonprofit survives the age of DOGE | HousingWire
https://www.housingwire.com/articles/neighborworks-america-housing-nonprofit-doge-affordable-homeownership/
Marietta Rodriguez | LinkedIn
https://www.linkedin.com/in/marietta-rodriguez
Marietta Rodriguez | FDIC.gov
https://www.fdic.gov/advisory-committees/marietta-rodriguez
Enjoy the episode!
The Power House podcast brings the biggest names in housing to answer hard-hitting questions about industry trends, operational and growth strategy, and leadership. Join HousingWire president Diego Sanchez every Thursday morning for candid conversations with industry leaders to learn how they’re differentiating themselves from the competition. Hosted and produced by the HousingWire Content Studio.
Category
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NewsTranscript
00:00This episode of Powerhouse is brought to you today by Polly.
00:05We really see housing and investing in communities as a non-partisan issue.
00:10And we are able to share our story of impact with both sides of the aisle.
00:17We know that there are serious issues and we're absolutely at the ready to help tackle them together.
00:30Welcome to Powerhouse, where we interview the biggest names in housing and ask them about their strategy for growth.
00:37I'm Diego Sanchez, president of Housing Wire.
00:41And my guest today is Marietta Rodriguez, CEO of NeighborWorks America.
00:48Marietta, it's so great to have you on the show.
00:50Thank you for having me. I'm excited to be here.
00:52So for those of us in the audience that aren't familiar, what is NeighborWorks America?
01:01NeighborWorks America is a congressionally chartered public nonprofit.
01:05We were created by Congress in the 70s to help fight disinvestment in urban neighborhoods.
01:11And we do that. We've grown and evolved since then.
01:15We serve our mission in a variety of ways.
01:17We have a network of locally based nonprofits that focus on housing and community development.
01:24We have organizations in every state, including the District of Columbia and serving on the island of Puerto Rico.
01:31And we provide grants to them for those organizations to operate.
01:37We also provide lending and construction capital for them to develop.
01:42We also provide training, capacity building, and technical assistance.
01:46We're also one of the largest trainers in the community development fields.
01:50We offer our training to non-network organizations and entities.
01:54And we do that in in-person trainings, virtually.
01:58We're getting ready for a virtual training institute now in May.
02:03And then in August, we'll be in the Big Easy in New Orleans,
02:07where we'll offer over 100 courses in housing, community development, and organizational management.
02:12We're a pretty unique organization in that we have a statutory board made up of the heads of the bank-regulating agencies.
02:21And we receive or are very fortunate to receive support from Congress through a direct appropriation.
02:29And we do fundraise privately as well, but we leverage the money we get from Congress
02:35and infuse that into the network organizations that I spoke about.
02:39So the national organization is really a public-private partnership, it sounds like, in terms of how the money comes in.
02:48Are those local chapters also public-private partnerships and getting funding from the national organization,
02:56but also local companies and individuals?
02:59They are.
03:00I think that's one of the huge strengths of the network, is that we're able to bridge the gap between public-private,
03:07but not only through leveraging money, but leveraging skills and partnerships.
03:12One of the foundations for us was a model that was discovered in Pittsburgh in the 70s,
03:21where a nonprofit was formed because members of a neighborhood in Pittsburgh were frustrated.
03:29They couldn't receive bank financing to improve their homes, replace roofs or fix furnaces.
03:38And so the residents of that neighborhood brought business leaders together, mostly bankers,
03:43as well as government representatives from the local city and county.
03:49And they all sat around the kitchen table, literally, and solved their community problems together.
03:55And what emerged was a nonprofit that these banks invested in.
04:01They formed a revolving loan fund that the nonprofit managed,
04:05and that's how residents in that community began to improve their homes.
04:09That model, that public-private partnership, is the foundation of the NeighborWorks Network.
04:14Every organization, those 250 that I spoke about, have residents as well as business leaders and government leaders
04:23on the boards of directors of those nonprofits that lead the direction of what that organization does in that community.
04:32So it sounds like the organization, both the National Parent Organization and the local chapters,
04:39were really born out of community response to redlining issues.
04:45That's exactly right. You got it right.
04:47So I'm sure that mission has evolved for NeighborWorks over the past few decades since the founding.
04:58What do you view as the current organization's role in the U.S. housing market?
05:06That's a great question.
05:07I would really like to say that NeighborWorks is one of the leading voices in the affordable housing industry.
05:15And we do that through a variety of ways.
05:19First, we definitely listen to the community.
05:22What are the community needs and how can we equip and support that local organization to respond to those needs?
05:31And we have the power of this network.
05:35So chances are if a community is struggling or tackling a problem, someone else in the country has already tackled that problem.
05:43So one of the best things we do is we bring peers together to innovate and problem solve together to learn from each other.
05:54And then we can infuse resources to help that innovation grow and replicate across the country.
06:01So we do that.
06:03But we also can convene the private sector to sit alongside us and the nonprofits to hear what issues are really happening on the ground.
06:15We have that direct connect into communities and really raise those voices and those issues and problem solve together.
06:24And really rally all of the major voices in housing and community development together to attack the problem or the issue that may be facing the community.
06:37So it sounds like the national organization which you run, your clientele is sort of the local organizations and also other community organizations that you're helping with financing and training.
06:52Let's dive down into the local organization.
06:57Primarily, who do they serve?
07:00You know, they serve our organization serve primarily what would be considered that affordable market workforce housing.
07:08The network owns and manages over 210,000 units of affordable rental in their portfolios.
07:15We also have a, we're known for our homeownership work and through housing counseling, affordable mortgage lending.
07:26We have over 83 CDFIs, it's community development financial institutions in the market.
07:34The majority of the customers that our network sees are somewhere below, between 80 and in high cost markets, they can go up to 120% of area median income.
07:48But the majority of the customers that we serve are customers from diverse racial backgrounds, falling somewhere between 75 and 120 of the area median income.
08:02That customer can be someone that's looking for an affordable rental unit, could be a customer that would like to become a homeowner and is daunted by the process, could be someone who's struggling financially with their credit and debt load, and they want to come in and work with one of the housing counselors or their home purchase advisors to help them put them on the path of homeownership, help them manage their debt and their credit.
08:28It can be someone that's looking for down payment assistance or some other resources.
08:34Our organizations really serve as a resource hub in communities.
08:39For example, during the pandemic, we had some organizations working at the nexus of health and housing, but regardless, our organizations knew where resources were.
08:51So even though they're not first responders, people trust them because they've been in the community for a long time, and so they can give information and referrals out.
09:02So while the customer base of the network is in that sort of 80 to 120, organizations don't rarely turn people away, particularly if they're looking for just information or maybe they're looking to help a family member or a friend, personal referrals are huge in this market.
09:23I have to imagine that affordable housing supply is the major challenge for the folks that are served by local organizations in your network.
09:39How does the national organization and local organizations help as it relates to supply?
09:47Yeah, you talked a little bit about being really a pretty big multifamily operator at this point, but how else do you help with that supply challenge?
09:57It's a great question.
09:58Some folks don't realize, but we're a home builder.
10:01Our network organizations are developers.
10:04In fact, we recently ranked number 78 on the Builders 100 list.
10:10Oh, that's crazy.
10:11Isn't that insane?
10:12Yeah.
10:12As a collective, we're in the top 100 builders, so there are thousands of units in our network, single-family and multifamily pipelines, and so how we contribute is providing units that go online, but we know that there's more that's needed.
10:33We're not even close to meeting the demand in the United States right now, as you know, and I would say to that end, our network is sitting on a pipeline of more than probably 60,000 units, a mix of both single-family and multifamily, that are ready to go into the ground today, but for having the right kind of capital to get those construction, that development underway.
10:58Is that an area where we have a lot of mortgage lending executives in this audience, is that an area where you can partner with depository institutions and independent mortgage banks to help facilitate some of those projects?
11:18A hundred percent.
11:19A hundred percent.
11:20We, we, the network loves to partner with local lenders, not only to seek the right kind of investment, to, to mix in that investment stack, but also in finding mortgage-ready customers.
11:36And very often, our, the customers that go through the network, that are educated and prepared, are default resistant.
11:44Back in 2008, we did this study that showed that customers that went through the NeighborWorks network were twice as, those that did not go through the network were a third more likely to suffer an early delinquency in the first two years of origination.
12:06So, we know that that partnership is, is important, and we know that we can deliver default resistant buyers in addition to being a partner on the development side.
12:18Yeah, it's really interesting.
12:19I mean, reducing risk of, of a loan.
12:22I have to imagine that, that lending institutions look pretty favorably on that.
12:28You, we'd like to think so.
12:29Uh, I think, uh, every, so often we have to work at re-educating our lender partners about the value of housing counseling, uh, and our realtor partners, frankly.
12:39Oftentimes, uh, realtors and mortgage originators see a non-profit intervention as, um, as inefficient or taking time away, right?
12:51So, if you're a realtor and you're working with a customer and they need down payment assistance or maybe some credit repair, they can make a referral, but it can sometimes, they have a perception that it slows down the deal.
13:03And it doesn't have to, um, certainly if we start working with a customer early enough, it doesn't slow down the deal.
13:09But it, from a risk mitigation standpoint, a hundred percent, it makes, it makes a lot of sense, um, for borrowers to work with a local housing counselor.
13:19I, I would say not even, particularly on the prep, but even after they get into the home, you know, you know, and your listeners know, once you buy a home, that's the beginning of the story, right?
13:30You, there are demands for maybe new furniture or expenses that, expenses that that homeowner never had before.
13:38And so, having a linkage to someone local that can help you on a budget side and prepare when tax preparation time comes along.
13:48There's a lot of hand-holding and support that our organizations provide, even post-purchase.
13:53Where should folks in my audience go to maybe read some of the case studies that celebrate some of these partnerships, look at some of the stats behind reduced delinquency?
14:09Where should folks go to, to learn more?
14:11Uh, I would encourage them to check out our website, www.neighborworks.org.
14:17We have, you can look up organizations there.
14:20There's a lookup.
14:21There's also a research tab where you can look for some of these papers and case studies.
14:26Um, and, uh, you know, we have regional offices, uh, throughout the country.
14:32So, if you have a lender or an audience member that is interested in partnering in a particular part of the country, um, yeah, just reach out to us and, and we'll make that connect.
14:42We, we, uh, we want to be a partner with the private sector.
14:47Amazing.
14:49So, I imagine in your, uh, organization's day-to-day implementation of projects across the country, you are encountering NIMBY issues as it relates to building and rehabilitating homes.
15:09How do you tackle that challenge?
15:12Yeah, that's a tough one for sure.
15:14I think because our organizations are, are, have such deep roots in the community, there are known actors.
15:23People know they're not, um, they're not new to the market.
15:27They're committed to the community.
15:28So, I think that helps, right?
15:29They have some credibility and they have, um, some, uh, trust that, that they, when, when they're coming to put a development online.
15:38I think when our organizations are able, or even NeighborWorks are able to break down what affordable housing really is, at the end of the day, it's workforce housing.
15:49It's providing housing for first responders, for kindergarten teachers, for nurses and nurse techs.
15:57And so, for retail workers, our grocery store workers.
16:02So, when we start to break that down and really, um, reveal the face of who benefits from affordable housing.
16:10You need all of those people in a community for a community to be strong and to thrive.
16:16And I think that takes a little bit of the, the mystery or the, there's a lot of misinformation and a lot of, um, you know, bias against affordable housing because of what it used to be in the 70s.
16:30There's no sort of ugly buildings, no landscaping, uh, one of the hallmarks of the NeighborWorks Network, particularly on affordable rental is resident services.
16:39We provide, um, many of our organizations provide a, uh, a wraparound or comprehensive services to those communities that can include childcare and computer labs for children and activities, healthcare, healthcare services.
16:54So, it really makes them be a part and embed them in that community.
16:59And so, they're seen as a community asset as opposed to something that's bringing down home prices.
17:05And I think when we can, when we have the time and the opportunity to share that story, then, um, that NIMBYism turns into yes in my backyard because people want to have, you know, people fill those, stable people fill those roles in the community.
17:23But it, it takes some time.
17:25And I'm not saying that it, it happens automatically every single time, but it is something that our network does encounter.
17:32But I think for the most part is able to break through some of that because they are that trusted organization that has been in the community for years.
17:39So, NeighborWorks, we discussed already that NeighborWorks was launched to address redlining challenges in urban areas.
17:50However, in doing my research for this episode, it, it seems like you've really pushed as an organization into, into addressing rural housing issues.
18:02Um, could you compare and contrast some of those issues, you know, you know, that, that an urban local organization may face versus some of the issues that one of your organizations in a more rural setting would address?
18:19I, I, I really appreciate, Diego, the question about rural, because it is something we are very committed to, uh, something we think is really important in this country.
18:29And, um, you know, they face very similar problems as, or issues, challenges that urban, um, communities face.
18:40The problem is, the problem is it's scale, right?
18:42It's just a very different scale.
18:45So, uh, it makes the rural, um, affordable housing story a little bit more complicated because of the scale.
18:52So, um, you know, it can be challenging because there's lower population, which, um, means a little bit lower demand in it.
19:02And it changes the economies of scale equation for, for example, a private sector developer.
19:08Um, and the amount of subsidy perhaps that's needed for rural development is a very different equation than that for an urban one.
19:18And so oftentimes the return on investment is more difficult to pencil out because of the higher costs.
19:25And then you have, you have labor and sometimes lack of infrastructure that you take for granted in an urban setting.
19:32There may not be in, um, a more rural setting.
19:36So all of that translates into just more, um, more investment that is needed.
19:42Um, sometimes in rural neighborhoods, in rural communities, you have older housing stock that needs deeper subsidy again for renovation, um,
19:52because it's declined over the years and they've suffered from, from, um, lack of investment.
19:58And we've really seen, um, a dive in new construction in rural communities, um, recently.
20:08And, um, we're seeing declines in affordable rental units for sure in rural communities.
20:15So it's just, it's a scale issue, uh, both on, on the amount of housing, but, but also in the amount of subsidy that's needed.
20:22Um, and we're also seeing, we're hearing from our network that rural communities can have appraisal gap challenges because there may not be, you know, like properties or there aren't as many sales.
20:34So it's difficult for that sometimes to underwrite those deals for that reason as well.
20:39So it's just, it's, it's, um, you know, appraisal gaps can happen in rural and urban markets too, but it's, um, it's a little bit different in rural markets.
20:48So, um, and, and we see that the community development infrastructure in rural markets is, is sometimes lags what we see in, in more urban communities.
21:02But nevertheless, um, there are innovations happening in rural markets.
21:07We're working really closely with, uh, factory built and modular home developers that can bring, uh, really high quality homes, uh, on site.
21:18And they've really improved the quality of construction and really, um, pushed on price.
21:25Uh, I think we have to see if, if the tariff, tariff, um, uh, issue is going to impact that, but there is, there are innovations happening and, um, we're excited to see that.
21:40Yeah.
21:40I really liked the extension of that focus into rural communities because, you know, socioeconomic and affordability challenges related to housing aren't just urban issues.
21:51Um, so, uh, that, that makes a lot of sense to me.
21:54Um, all right.
21:54So last question is on the new administration in DC, uh, that new administration features pretty prominently the Department of Governmental Efficiency, um, which, uh, is looking at cuts really across, uh, government, uh, efforts.
22:15Um, do you have concerns about, uh, funding cuts in this next budget?
22:20I mean, we always have concerns about funding cuts, especially, uh, not only the funding cuts that NeighborWorks could experience, but funding cuts to programs that are really critical in, um, in communities, um, community development block grants, the home program, Section 8, um, cuts to the CDFI fund.
22:41I mean, I mean, there's a lot of programs out there that our organizations rely on, uh, to, to solve some of the challenges that communities are facing.
22:50So we always have that concern.
22:53I was very encouraged that the administration so early put out an executive order, uh, um, encouraging and wanting to solve the, uh, housing affordability crisis in this country.
23:06And we have really, uh, deep history in working with, um, the private sector and, um, administrations regardless of, um, of the politics of the administration of, of really solving and working together, linking arms and solving the issue.
23:25And we look forward to doing that, um, with this administration as well.
23:28And as a congressionally chartered organization, I imagine you are also collaborating, uh, with both sides of the aisle in Congress, um, to make sure funding priorities are, are, are heard and, and thought about.
23:45A hundred percent.
23:45I think, um, we really see housing and, and investing in communities as a non-partisan issue.
23:52And we, uh, uh, are able to share our story of impact with both sides of the aisle and, and both sides of the aisle seem, are very supportive of, of our work and, and the work going on in communities.
24:07Um, so, uh, yeah, we really, uh, we know that there are serious issues and, and we're absolutely at the ready to help, uh, tackle them together.
24:17Yeah.
24:18Addressing affordable housing is one of the few issues in this country that is like a 90% issue.
24:25Like everyone is concerned about the lack of affordable housing and would like for us as a society to be doing more things about affordable housing.
24:33Uh, so that has to be in your favor.
24:36I, I, I hope so.
24:37I hope that the wind is on our back.
24:39We have to solve this issue.
24:41Um, because unless people are, you know, we saw during the pandemic, for example,
24:47that's a great example.
24:48When people were not suitably housed, it became a life and death issue, right?
24:54Right.
24:54Um, and people were using their homes.
24:57They were working out of their homes.
24:59They were educating their children out of their homes.
25:02Um, they were accessing telehealth out of their homes.
25:05And so when someone is not suitably housed, it impacts every other element in their lives.
25:12And so it's really a foundational issue.
25:15And it requires us all to collaborate, innovate together, and invest together for solutions.
25:22Well, thank you so much for joining me today.
25:25I thought we had a really productive and interesting conversation.
25:30And I wish you success, uh, in, in the coming years.
25:34Thank you, Diego.
25:35I really appreciate Housing Wire putting a spotlight on the affordable housing issue.
25:39I know you deal with a variety of issues on your show, but I, I'm so grateful that you,
25:44uh, that you're highlighting this because it's really important.