The U.S. Department of the Treasury announced new steps Monday to address housing affordability. The plan mirrors many policies also advocated by NAR to help lower housing costs and increase housing supply.
Specifically, the provisions include a new Treasury program administered by the Committee Development Financial Institutions (CDFI) Fund that will provide an additional $100 million over the next three years to support the financing of affordable housing, an effort to provide greater interest rate predictability to state and local housing finance agencies borrowing from the Federal Financing Bank to support new housing development, and a call to action for the Federal Home Loan Banks to increase their spending on housing programs.
The plan also creates a new “How-To Guide” to support state and local governments in using recovery funds provided by Treasury to construct housing and updates the Capital Magnet Fund to provide greater flexibility to CDFIs and non-profits that finance affordable housing.
“Executive agencies have the power to act quickly to promote homeownership. We applaud the Biden Administration’s comprehensive, multi-agency response targeting solutions at every level of government. It will take an all-of-government approach to yield results in this fight,” said NAR’s Chief Advocacy Officer Shannon McGahn.
NAR also supports the Yes in My Backyard (YIMBY) Act (H.R. 3507), which would require localities receiving Community Development Block Grant (CDBG) funds to publicly report how they are removing barriers to affordable housing development. It would also encourage state and local governments to consider a variety of methods that contribute to the housing supply, like removing zoning regulations, reducing parking requirements, or decreasing regulatory barriers that prohibit development.
“Overly restrictive zoning and burdensome permitting regulations are slowing construction and preventing lower-cost housing from being built where needed. City and state regulations should encourage the construction of affordable housing by supporting zoning for multi-family structures and manufactured homes,” McGahn said.
McGahn also met with White House officials Monday to discuss housing affordability issues and share some of NAR’s original research.
“An investment in housing is an investment in the American economy,” McGahn continued. “Each home sale generates two jobs, and the real estate sector alone makes up nearly 20% of the entire economy.”
“Housing construction peaked in 2005 with over 2 million housing starts, but just four years later, it bottomed out at 550,000 starts. With a historical average of 1.5 million starts per year, we are in a deficit that will take years to correct without urgent action,” McGahn continued. “NAR’s own landmark research revealed a 5.5-million-unit shortage nationwide. And our country has the largest shortage of homes in the middle-income price range, creating what’s called the ‘missing middle.’”
NAR recently joined forces with the National League of Cities, the American Planning Association, and other housing stakeholders to produce the Housing Supply Accelerator Playbook(link is external), which incorporates REALTOR® associations’ work to expand housing supply as part of a roadmap to inspire and incentivize local housing efforts.
The National Association of Realtors® is America’s largest trade association, representing 1.5 million members involved in all aspects of the residential and commercial real estate industries. The term Realtor® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics.