In 2024, HUD awarded the inaugural PRO Housing competitive funds to 21 winners to advance housing opportunities in communities across 19 states and the District of Columbia. For the second round of PRO Housing grants, HUD made 18 awards across 14 states. The applicants and winners represent rural, suburban, and urban communities ranging from under 5,000 residents to millions. In the first two rounds of competition, barriers such as high cost of land, lack of available units, inadequate infrastructure, gaps in financing, restrictive zoning, risks of displacement, expiring affordability, threats from extreme weather, and an aging housing stock were commonly expressed by PRO Housing applicants. Prior PRO Housing funding enabled awardees to address those barriers through planning, infrastructure, development, and preservation actions to further local housing goals.

HUD is issuing this FY26 PRO Housing NOFO under the authority of the Consolidated Appropriations Act, 2026, which appropriated $50 million for competitive grant funding that will reward state, local, and regional jurisdictions that have made progress in improving inclusionary zoning practices, land use policies, and housing infrastructure that will increase the supply of affordable housing. Eligible applicants are State and local governments, metropolitan planning organizations (MPOs), and multijurisdictional entities.

The Appropriations Act requires HUD to award grants using the Community Development Block Grant (CDBG) statutory and regulatory framework. As with all CDBG assistance, the priority is to serve low- and moderate-income people and households. HUD will prioritize applicants that demonstrate: (1) progress and a commitment to overcoming local barriers to facilitate the increase in affordable housing production and preservation, primarily through deregulation or by enacting improved laws and regulations that preserve or produce new housing units; (2) an acute need for housing affordable to households with incomes below 100 percent of the area median income; and (3) a commitment to create new homeownership units before the expiration of the funding performance period.

In addition to thoroughly reviewing this NOFO, applicants are strongly encouraged to monitor HUD’s PRO Housing website for information about general updates, Frequently Asked Questions, and PRO Housing webinars.

HUD has six goals for this competition:

1. Decrease the cost and increase the supply of affordable housing, especially in Opportunity Zones and rural communities.
2. Remove barriers to affordable housing that results in constructing or rehabilitating more units, reducing time to produce units, and unlocking land that can be used for affordable housing units.
3. Reward jurisdictions that have enacted laws and regulations that will lead to more affordable housing production and preservation.
4. Increase opportunities for affordable homeownership by reducing administrative and structural barriers.
5. Promote promising practices dedicated to identifying and removing barriers to affordable housing production and preservation, while preventing displacement of LMI people.
6. Institutionalize state and local analysis and implement effective approaches to affordable housing production and preservation.