WASHINGTON- The House appeared poised Tuesday to pass Congress's most significant housing legislation in decades — an attempt by both parties to show midterm voters that they are paying attention to affordability concerns ahead of the November elections.
The legislation, which the Senate approved on Monday, aims to boost housing supply through dozens of specific provisions whose effects are expected to be seen in the coming years. In California, measures to provide federal funding for housing production in large cities could be particularly significant.
The bipartisan agreement on the legislation, after weeks of negotiation, marks a highly unusual collaboration in the divided Congress. It reflects growing public pressure on Washington to address economic problems, at a time when Americans' economic woes are deepening amid inflation, high gas prices and the continuing effects of President Trump's tariffs.
The bill aims to help housing supply by removing regulatory barriers to the construction of affordable housing units, preventing large investors from purchasing single-family homes, and incentivizing housing production in cities with federal funds, among other measures.
The package focuses on addressing housing supply constraints and making federal programs easier to use, said David González Rice, senior vice president of public policy at the National Low Income Housing Coalition. Although the legislation does not create significant new sources of funding, its bipartisan recognition of the need for housing reforms is seen as significant by its advocates.
“It's a big step in the right direction,” Gonzalez Rice said, “and there's still a lot of work to do.”
The bill passed the Senate on Monday in a vote of 85-5, with five Republicans opposed. The Trump administration has expressed support for the bill.
Addressing cost-of-living issues has become of utmost importance to lawmakers involved in midterm re-election campaigns, as Americans disapprove more and more of Trump's handling of the economy. Democrats hope to leverage affordability issues to gain control of at least one chamber of Congress, while Republicans fight to maintain their majorities.
It was politically crucial that members of both parties be able to tell voters that they had worked in good faith to address housing affordability, said David Garcia, deputy policy director at UC Berkeley's Terner Center for Housing Innovation.
“It would have been difficult to justify to voters during his campaigns that his party did not do everything it could to advance the first significant housing policy legislation in decades,” García said.
The legislation was the product of intense bipartisan negotiations led by Reps. Maxine Waters (D-Los Angeles) and French Hill (R-Ark.), as well as Sens. Elizabeth Warren (D-Mass.) and Tim Scott (RS.C.), after months of bipartisan bickering over how to address housing.
Waters, who said the difficult conversations were no small feat, called the collaboration “the beginning of a renewed effort to address our housing affordability crisis.”
House Majority Leader Steve Scalise (R-La.) promised Friday that the bill would “make its way to President Trump’s desk.”
Trump, who has largely dismissed the issue of affordability, calling it “a false word” last week, had expressed support for real estate reforms.
In a March policy statement, the administration indicated it “strongly supports” passage of the bill, saying it represented “significant advancements in federal housing policy.” Trump also signed an executive order suggesting that regulatory barriers to home construction be removed, a concept reflected in the bill.
The nationwide affordability crisis has been driven for years by rising costs, a shortage of affordable housing, higher mortgage rates and other factors. Recent increases in construction costs and labor shortages have exacerbated the problem, according to the National Association. of home builders.
The number of new housing starts in May fell more than 15%, according to a report last week from the U.S. Census Bureau and the Department of Housing and Urban Development.
California has increased housing supply in recent years, but housing shortages remain significant and prices high. The state has one of the highest rates of households spending disproportionate amounts of their income on housing, according to the Public Policy Institute of California.
The push in Washington to respond to those pressures, which came as a surprise to advocates, can be seen as a reflection of current public sentiment, González Rice said.
“This speaks to a broader public understanding that housing is a political issue, that the government can do something about it, and the expectation that the government will do something about it,” he said. “It's clear that elected officials are listening to their constituents.”
The bill includes nearly 50 provisions, including prohibiting investors from purchasing single-family homes, intended to help increase the supply of housing for individual buyers. It also seeks to help cities convert abandoned buildings into new housing and help homeowners and landlords make home repairs.
Two measures are expected to be particularly significant for cities like Los Angeles and San Francisco, Garcia said: One ties some federal funds under the Community Development Block Grant program to housing production to encourage cities with low housing supply and high costs to build more housing. The other allows block grant money to be used to build affordable housing, opening up a new source of revenue for cities.
California's big cities could be driven to increase housing production in the coming years, Garcia said, and could also benefit from the ability to direct block grant funds to housing.
“Construction costs are so high,” he said, “that any new financing could be critical.”
Among other measures that could have quick results are a plan to preserve a rental assistance program for nearly 400,000 rural homeowners and a measure to streamline the rental process for families that use vouchers, González Rice said.
The bill also exempts certain projects from a set of environmental regulations, a step intended to speed up the review and construction process. And it seeks to make it easier to build manufactured homes by eliminating the requirement that they be built on a chassis, which the Senate committee estimated would reduce the cost of each new unit by up to $10,000.
