H.R. 8854 — Habitable Housing Conversion Pilot Program Act of 2026

This section establishes a 5-year pilot program authorizing the Secretary of Housing and Urban Development to insure up to 150,000 mortgages under section 203(k) of the National Housing Act to finance conversion of basement space in owner-occupied properties into safe, habitable rental units that meet state and local codes. The Secretary must consult with the FEMA and NOAA administrators to identify and may prioritize hazard-prone areas, issue implementing regulations, submit a report to Congress assessing the program and recommending reauthorization or termination, and may use appropriated sums as necessary.