The Low-Income Housing Tax Credit program celebrates its 30th anniversary this year. CohnReznick has released a look back at the performance of LIHTC properties over the program’s lifetime, as well as recent trends for the 20,000 properties that make up the current tax credit portfolio.

The Low-Income Housing Tax Credit Program at Year 30: Recent Investment Performance (2013-2014) provides a breakdown of property investment performance by 12 regional areas, by state, and by Metropolitan Statistical Area (MSA).

The report’s findings include:

  • All basic metrics improved since 2012.
    • Physical occupancy increased from 97% (2012) to 97.5% (2014)
    • Debt coverage ratio improved from $1.30 to $1.33
    • Per unit per annum cash flow improved from $498 to $597.
  • Number of “underperforming” properties decreased.
    • 35% of properties were operating below breakeven (less than 1.00 DCR) in 2005. By 2014, that fell to 16.9%.
  • There is no meaningful difference between properties developed by for-profit developers and non-profit developers.
    • Occupancy is slightly higher in properties developed by non-profit developers.
    • Cash flow is slightly higher in properties developed by for-profit developers.
  • Average credit investor has realized 98.4% of credits promised through CY 2014.

CohnReznick will hold a webinar to discuss the report on Thursday, January 21 at 1:00pm ET.