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Senate Passes Bipartisan Housing Bill 06/23 06:05
The Senate passed a bipartisan housing bill on Monday that aims to reduce
federal regulations and expand local control, one of the most sweeping efforts
in recent decades to increase supply and bring down prices.
WASHINGTON (AP) -- The Senate passed a bipartisan housing bill on Monday
that aims to reduce federal regulations and expand local control, one of the
most sweeping efforts in recent decades to increase supply and bring down
prices.
The bill, which passed 85-5 and now heads to the House, has been the focus
of intense negotiations in recent weeks as lawmakers in both parties try to
address housing costs in an election year. The final version of the legislation
bans corporate investors from buying single-family homes but doesn't include a
Senate provision that would have required investors to sell newly constructed
homes within seven years.
The measure was the result of years of work to "lower costs, expand housing
supply, cut red tape, protect taxpayers, and help more Americans achieve the
dream of homeownership," said Senate Banking Committee Chairman Tim Scott,
R-S.C., who worked with Democrats to get the bill passed.
Massachusetts Sen. Elizabeth Warren, the top Democrat on the banking panel,
said it is the most significant housing bill to pass Congress since 1990, when
the average home in America was sold for $150,000. Now it costs more than
$500,000, she said.
The bill "acknowledges that the federal government has a role to play in
lowering housing prices," Warren told The Associated Press. "For the first time
ever, private equity will be blocked from buying up single-family homes and
trying to turn housing into one more Wall Street investment."
Senate passage of the bill shapes up as a rare bipartisan legislative
achievement when much of Republicans' agenda has stalled. The House is expected
to give final approval later this week and send the bill to President Donald
Trump, who has signaled his support.
Democratic Rep. Maxine Waters of California, who helped negotiate the
legislation, said it was a "huge step toward finally addressing the affordable
housing and homelessness crises in this country."
Housing costs are a concern for both parties
Republicans and Democrats have embraced the bill as a way to show they are
addressing the nation's affordability crisis, driven in part by rising home
prices due to a shortage of affordable housing. The U.S. housing market has
been in a slump dating back to 2022, when mortgage rates began to climb from
pandemic-era lows.
Sales of previously occupied U.S. homes have been hovering close to a
4-million annual pace going back to 2023 -- well short of the 5.2-million
annual pace that's historically been the norm. Sales slowed last year to a
30-year low and have remained sluggish so far this year, declining in January
and February versus a year earlier.
The Economic Report of the President in April found a shortage of 10 million
homes, while a report this month from the Joint Center For Housing Studies at
Harvard University found sales of existing homes were at three-decade lows and
inventories were rising due to high home buying costs. "Cost burdens for both
renters and owners continue to climb, while assistance remains profoundly
underfunded," the report said.
While the median U.S. monthly rent has been declining for nearly three
years, it was still 17.2% higher in May than it was before the pandemic,
according to data from Realtor.com.
Changes for grants, Section 8 and manufactured housing
To increase the supply of housing, the bill would streamline environmental
reviews and speed up the construction process.
It would offer funding to local governments that build more housing,
including Community Development Block Grant money to places exceeding the
median rate of homebuilding. It would also provide new dollars for communities
to turn abandoned infrastructure into housing, and offers a framework for
communities that want to reform outdated zoning regulations, which often limit
larger housing developments.
The legislation would allow banks to invest more in affordable housing and
raise limits on the number of public housing units that can receive private
financing through Section 8 funding to rehabilitate properties. And it would
remove outdated requirements and expand federal financing to make manufactured
homes more affordable.
"Manufactured housing produces some of the most cost-effective housing in
America, but access to financing has been tightly restricted," Warren said.
"This creates the opportunity for more manufactured housing and, at the same
time, creates a structure for people living in manufactured housing communities
to organize and protect their investment in their homes."
Lawmakers compromised on a disaster program
One of the sticking points between the two chambers was over a federal
disaster recovery program.
An earlier Senate bill had permanently authorized block grant recovery
funds, a change intended to ensure that funding requests aren't needed after
every disaster. House lawmakers opposed that provision because of concerns over
how the program was run, so they agreed on a three-year authorization instead.
The final bill has received widespread support in the housing community,
both from organizations representing landlords and large property owners as
well as groups that advocate for tenants and low-income renters.
"There is no magic wand that will fix this crisis overnight, and no single
piece of legislation is perfect," said David Dworkin, chief executive of the
National Housing Conference, the nation's oldest housing coalition.
"Compromise demands that. But this bill is a significant down payment on a
long-term effort to make housing more affordable for all Americans."
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