Federal pilot would fund conversion of vacant buildings into affordable homes

What does this do?

HR 5591 establishes a five-year pilot program from 2027 to 2031 in which HUD awards competitive grants to local governments and housing authorities to convert vacant, blighted commercial properties into affordable or attainable housing. Eligible buildings include warehouses, factories, malls, strip malls, and hotels that are unsafe or legally abandoned. Grant funds may be used for acquiring properties, demolishing unsafe structures, cleaning up health hazards, and constructing or renovating homes.

Who does it affect?

Local governments and developers who partner with them are the direct applicants and recipients. Lower- and middle-income renters and buyers, as well as elderly people, people with disabilities, and veterans, are among those identified as potential residents of the resulting housing.

Why does it matter?

Communities with vacant or blighted properties could see those sites converted into housing stock priced at or below local median income levels, with most units reserved for lower-income households. The program adds funding on top of existing community allocations rather than replacing them, and priority is given to areas facing economic hardship, designated opportunity zones, and localities that have already reduced regulatory barriers to conversion.

What does it cost, and who pays?

• Grants from $1M to $10M each
• Competitive, not formula-based
• Requires HOME program funding floor

Where does it stand?