New home under construction. (Dan Reynolds Photography/Getty Images)
WASHINGTON — Republicans, Democrats and the White House are methodically and calmly moving toward a common goal: agreement on a sweeping package of legislation that would quickly make a difference in lowering housing costs and increasing supply.
There is no question of standstill here. No partisan snipers. It’s just an under-the-radar attempt to show voters in an election year that their lawmakers recognize there’s a gigantic problem when it comes to buying homes.
For this reason the house Earlier this month, the country passed its version of housing reform with just nine votes against. The Senate committee that wrote a similar bill passed it unanimously last year.
While there are still hurdles to overcome before anything reaches President Donald Trump’s desk, what’s happening is almost a throwback to the days when getting 80% of his plan was a major victory, a political prize to tout at home as the midterm elections approached.
“There is no panacea to fix this problem,” he said Rep. Mike FloodR-Neb., Chairman of the Subcommittee on Housing and Insurance.
But he added: “I think that this bill, this legislation, contains a number of sensible housing reforms that will increase housing supply and ultimately reduce housing costs.”
Housing shortage
The House and Senate bills share a common purpose, said Emma Waters, senior policy analyst at the Bipartisan Policy Center in Washington. “Both bills are really aimed at making it easier to build more affordable homes,” she said.
Rep. Emanuel Cleaver, D-Mo., a member of the House Financial Services Committee, explained the House bill: “It ensures that every dollar we spend helps.”
A Zillow Group analysis, A real estate firm that studies housing prices and trends found last summer that about 1.4 million modern homes were added to the housing stock in 2023, but there were 1.8 million newly formed families.
As a result, the housing shortage was up to 4.7 million units. Other estimates put the number at up to 7 million.
The typical house price According to Zillow, the price was $359,078 in the United States in January, up 0.2% from a year ago. Prices depend on a variety of factors, including labor costs, material costs, interest rates, supply and demand, and more.
What the government can do
The Legislation of Congress is trying to lend a hand as much as possible to facilitate supply and stabilize prices, as best as the government can currently do.
The House and Senate bills contain several similar provisions. The Bipartisan Policy Center, a Washington-based research organization, valued the House bill Contains portions of at least 43 different House or Senate bills27 of these were supported by both parties.
Under the House plan, the federal Department of Housing and Urban Development would update the department’s construction standards for manufactured housing. The Senate bill contains similar provisions.
Rep. John Rose, R-Tenn., a member of the Housing Subcommittee, explained the problem: “Communities across the country have restricted or banned the construction of homes on durable steel frames. The result has been less construction, higher costs and fewer opportunities for working families to own their homes.”
The House bill would provide money for “model books” for such housing, which would contain pre-approved plans that could speed up the approval process.
The legislation would also “contain many provisions to make it easier for state and local governments to reduce regulatory hurdles,” Waters said.
The bills would allow money out Community Development Block Grants, that lend a hand fund neighborhood projects to better support housing production.
The Senate bill would reward CDBG recipients who increased their housing production in the previous year, independent of their other CDBG projects.
As a reward for building more housing in the previous year, these jurisdictions would receive additional CDBG funds, but restrictions remain on how these funds can be used.
However, the House bill would change the restriction so that CDBG funds could be used for housing.
Help for consumers
Housing experts believe one reason landlords are shying away is because they are reluctant to endure the government’s inspection process. The bills would streamline that process. Landlords would receive incentives to take in tenants with rental vouchers.
The HOME Investment Partnership Programwhich supports state and local efforts to provide housing for lower-income families, would also see some kind of overhaul in the bills.
For example, the House bill says environmental impact statements would no longer be required for many projects and it would be easier to withdraw funds from the HOME budget.
Consumers should also be helped: banks, usually municipal institutions that focus on local needs, will be able to invest more easily in affordable housing. The House bill would escalate the cap on public welfare investments, allowing more such investments.
Rep. French Hill, R-Ark., was enthusiastic about this regulation. “Our bill makes it easier for banks to access stable deposit funding, streamlines the review process tailored specifically to our important community banks, and helps ensure more community banks do what they do best: lend locally and support their communities,” Hill, chairman of the Financial Services Committee, said in a statement.
What lies ahead?
Banking regulations are one of the few key areas where the Senate and House of Representatives disagree. Some Democrats worry that the House bill removes too many regulatory hurdles for banks.
“We have a bipartisan bill with unanimous support in the Senate that will help build more housing and lower costs for the American people. I am pleased to see the House making progress on housing proposals,” said Sen. Elizabeth Warren, D-Mass., top Democrat on the Senate Banking Committee.
However, she said, “House Republicans should not hold housing relief hostage to advance multiple banking deregulation bills that will make our community banks more vulnerable while harming consumers, small businesses and economic growth.”
Another potential to hamper negotiations is the White House’s intention to ban institutional investors from purchasing single-family homes. There isn’t much support in Congress for this idea.
Trump last month issue an implementing regulation requesting “key agencies to issue guidance preventing relevant federal programs from approving, insuring, guaranteeing, securitizing, or facilitating the sale of single-family homes to institutional investors.”
Stay bullish
There’s still a feeling at the Capitol that Republicans and Democrats will come together on a major housing bill, especially with Congress and the White House in agreement on most key provisions and leading advocacy groups helping push the legislation forward.
The National Association of Realtors expressed enthusiasm for the House and Senate bills.
“By removing barriers at all levels of government, the legislation will make building new homes faster and more affordable,” the organization said after the House passed the housing reform bill. Brokers had similar praise for the Senate version.
The Coalition for Affordable Housing Tax Credits It also liked the House bill, with CEO Emily Cadik calling it “a set of common-sense, bipartisan housing proposals” that would escalate the supply of affordable housing.
Most in Washington who follow housing policy closely are bullish about the legislation’s prospects.
“It’s all pretty positive,” Waters said.
