Bipartisan housing bill aims to boost homeownership. Could it work?

A rare bipartisan bill, the '21st Century ROAD to Housing Act,' is set for a Senate vote, aiming to make homeownership more accessible and affordable for Americans by increasing the nation's housing supply. The legislation proposes to curb the purchasing of single-family homes by institutional investors and dismantle regulatory obstacles to construction.

If passed by the Senate, the bill will proceed to the House of Representatives for a final vote. President Trump has publicly supported the measure, urging Congress to pass what he described as "the most comprehensive and consequential housing legislation in the history of our country." He previously advocated for a ban on institutional investors buying single-family homes during his January State of the Union address.

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There's a general recognition that a big part of the reason why home sale prices and rents have gone up significantly is that we have under-built housing by millions of homes since the Great Recession.

The ROAD Act includes several provisions to expand housing availability. It aims to streamline the construction process by establishing pre-approved home designs, expediting environmental reviews, and promoting zoning reforms. Additionally, it introduces the Innovation Fund, a grant program allocating $200 million annually for five years to localities that demonstrate success in increasing housing supply. The bill also pilots a program to convert vacant commercial buildings into affordable housing and increases federal funding for factory-built homes.

Home prices in the U.S. have surged significantly, driven by a persistent imbalance between housing demand and supply. Data from the Federal Reserve Bank of St. Louis shows the median home price has risen 77% since 2011. The bill seeks to address this by capping the number of single-family homes institutional investors can purchase nationwide at 350 properties. This measure targets large investors like private equity firms and real estate investment trusts, which have been accused of acquiring vast numbers of residential properties, particularly following the 2007-08 housing crisis.

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the most comprehensive and consequential housing legislation in the history of our country.