Congress Advances Landmark Bipartisan Bill To Spur Housing Development

Growing concerns about the nationwide housing shortage have led to a rare moment of bipartisanship in Congress, with the House of Representatives on Monday evening passing a wide-ranging bill to address the crisis.

The Housing for the 21st Century Act passed by a 390-9 margin Monday night. The bill includes a series of supply-focused steps, such as removing environmental reviews that delay new construction and creating national guidelines for localities to reform their zoning. 

The bill has significant overlap with the Renewing Opportunity in the American Dream to Housing Act that the Senate passed in October. The two will likely be fused in the coming weeks before a bill is sent to President Donald Trump's desk, said Owen Caine, National Apartment Association assistant vice president of federal legislative affairs.

“Both bills are a sign that Congress understands we have a supply shortage,” said Caine, whose organization has been supporting both bills for months.

Following's the House bill's passage, NAA released a joint statement along with the National Multifamily Housing Council and the Real Estate Technology and Transformation Center applauding the House for passing the bill and urging the two chambers to unite around a final housing package. 

“Today’s vote represents historic momentum in Congress for the enactment of real housing solutions – meaningful policies to deliver more supply, lower regulatory barriers to development and increase housing access,” the statement says. 

The Trump administration released a statement ahead of the vote Monday saying it is “pleased” that the bill aligns with the president's priorities but adding that it is lacking one provision: Trump's proposal to ban the purchase of single-family homes by large institutional investors. 

Caine said the ROAD to Housing bill was the most significant bipartisan housing proposal to pass out of the Senate Banking Committee in at least three decades.  

“We live in a very political time, a partisan time,” he added. “I take it as a grace of God that each chamber was able to move bipartisan housing legislation to begin with.”

The U.S. has a deficit of up to 5.5 million residential units, according to a Goldman Sachs report released in October, equivalent to almost 4% of the nation’s existing stock.

The House bill seeks to accelerate housing development by removing regulatory barriers, including federal environmental reviews for small-scale residential projects.

It also directs the Department of Housing and Urban Development to create playbooks with best practices for local officials looking to modernize zoning and preapproved design “pattern books” for developers to expedite permitting.

The bill also sets a new definition for manufactured housing. Those structures have long been required to have a steel chassis, which makes it possible to move the homes even though that rarely happens after they are installed. The bill would remove that requirement. 

The legislation creates additional support for community and rural banks so they can lend more to developers working on residential projects. That includes a Treasury Department-run mentorship program that would pair these banks with larger institutions so they can better serve customers on this front.

The 49-section Senate proposal is much broader than the 14-section House bill passed Monday. There is significant overlap, particularly around increasing supply, but Caine said the ROAD to Housing Act has more to say about financial literacy and additional language to boost the manufactured housing sector.

Developers have long bemoaned the additional costs and time that local zoning and permitting regulations have forced on new housing construction.

The Senate bill sets out to remedy this by tethering Community Development Block Grant program funding to local housing growth rates, Caine said. Localities that host more construction will get additional funding, while those that don’t meet the national average will see fewer federal dollars.

Caine would rather see the federal government reward local officials’ pro-development behavior than punish those who resist.

​​“Carrots generally work better than sticks,” he said.

The House proposal passed Monday was unusually bipartisan. It passed out of committee in December via a 50-1 vote, with Rep. Ralph Norman of South Carolina casting the lone ballot against the measure.

While Caine said acknowledgement of the housing crisis is nearly universal in Congress, it doesn’t entirely transcend partisan politics.

“I don’t think it’s that anyone disagrees with the policy aspect. … It’s more about how you thread that political needle,” he said.

The House bill’s Republican sponsor, Rep. French Hill of Arkansas, framed it in a joint The Hill op-ed with Rep. Mike Flood of Nebraska as following through on Trump’s promise to keep the U.S. from becoming “a nation of renters.” 

The representatives blamed government red tape for elevated construction costs and long project timelines, as well as a lack of construction loans from local banks.

“The result is a housing market that works against the very people it should serve,” Hill and Flood wrote.

Rep. Maxine Waters, the Democratic ranking member of the Financial Services Committee who represents parts of Los Angeles County, called out a lack of funding for affordable housing programs in her December statement supporting the bill.

“The private sector has clearly shown that they are either unwilling or unable to build the millions of affordable homes necessary to end this crisis without the federal government coming to the table with real funding,” she said before calling for additional housing legislation.

“We cannot stop here,” Walters added. “This bill is a foundation, not a finish line.”