Key takeaways
- The House of Representatives is debating the Housing for the 21st Century Act.
- The bipartisan bill aims to boost housing supply by streamlining permitting and regulations, modernizing federal housing programs, strengthening manufactured housing oversight and unlocking more public and private investment.
- The measure comes at a time when some municipalities see an oversupply of housing, while others don't have enough to meet the demand.
Lawmakers are pushing forward a bipartisan bill to incentivize more housing construction at a time when some municipalities see an oversupply in their communities and others don't have enough to meet demand.
The Housing for the 21st Century Act, which was slated to go to a House vote Monday night, looks to boost construction primarily by streamlining the approval process and easing pathways to funding, according to Rep. French Hill, Republican of Arkansas, and Rep. Mike Flood, Republican of Nebraska.
The bipartisan bill looks to speed up housing production through faster permitting and scaled-back regulations, increase the supply of affordable and "missing middle" properties, update the HOME Investment Partnerships Program, expand U.S. Department of Housing and Urban Development oversight of manufactured home regulation and unlock more public and private capital for housing. Rep. French Hill, Republican of Arkansas and House Financial Services Committee chairman; Rep. Maxine Waters, Democrat of California; and Rep. Mike Flood, Republican of Nebraska and the Housing and Insurance Subcommittee chair; and Rep. Emanuel Cleaver, Democrat of Missouri, introduced the legislation.
Hill and Flood met with reporters Monday morning ahead of the vote to discuss the bill.
Some communities are seeing an oversupply of homes, while others like Philadelphia and New York City, are in a housing deficit. Lawmakers want to incentivize homebuilders to build where needed. Some homebuilders — grappling with tariffs, rising construction costs and a labor shortage — are offering incentives to sell their homes as many buyers still sit on the sidelines.
The bill will help developers where needed, Hill said. Local banks will have the final say on what projects to approve, he said, and he trusts that they will approve developments only where housing is needed.
Some U.S. metropolitan areas are seeing an oversupply of housing. Many analysts consider four to six months of housing inventory a balanced market, with anything below that amount benefiting buyers and anything above benefiting sellers. If a metropolitan area has a four-month supply, that means that at the current pace of sales, it will take that long for all of those properties to sell if no new ones are added.
Several metropolitan areas in Texas and Florida have communities with seven to nearly 10 months' worth of listings.
Still, much of the country is not meeting its housing needs. According to the latest data from the National Association of Realtors, the country has only a 3.3-month supply.
Three core components of the bill
The bill would address housing barriers in three ways:
- By eliminating some approval steps and allowing builders receiving federal funding to use preapproved home designs, speeding up the permitting process.
- By updating the HOME Investment Partnerships Program and allowing HUD to establish standards for manufactured housing. The HOME changes, sponsored by Reps. Emanuel Cleaver and Flood, would roll back certain labor and materials regulations, aiming to lower costs and speed up housing construction.
- By reducing the paperwork requirements and filings for local banks investing in housing projects.
"A lot of what we do is give cities the ability to use some of these federal funds to build infrastructure," Flood said, "and to make it easier for them to pass on those savings onto the developer who passes it onto the homebuyer."