Housing supply

Biden administration unveils five-year plan to close housing supply gap

The plan focuses on the federally funded construction of hundreds of thousands of affordable units, the easing of restrictive zoning and the introduction of new federal funding options.

The Biden administration on Monday announced a five-year plan to ease housing costs for American families by increasing the country’s supply of affordable housing.

The plan focuses primarily on the federally funded construction of hundreds of thousands of quality affordable units over the next three years, the easing of restrictive zoning and the introduction of new federal funding options for the construction of dwellings, with the aim of reducing the estimated supply of Moody’s Analytics. gap of 1.5 million homes.

“When aligned with other policies aimed at reducing housing costs and ensuring affordability, such as rental assistance and down payment assistance, closing the gap will result in more affordable rents and more accessible ownership for Americans in all communities,” the White House said in a statement. “This is the most comprehensive whole-of-government effort in history to close the housing supply gap.”

Among the effort’s key action points for the next three years are incentives for municipalities that adopt inclusive zoning and land use policies through higher scores in federal grant programs, a plan collaboration with the private sector to improve supply chain bottlenecks, an initiative to expand and improve the types of federal funding available for development, and develop new methods of financing to build housing where gaps exist – whether through newly fabricated dwellings or accessory dwelling units and smaller 2-4 unit buildings.

In the immediate term, the administration plans to use transportation funding from the bipartisan infrastructure program to encourage state and local governments to increase their housing supply, integrate more housing funding into departmental plans Federal Department of Transportation and adding land use to economic development in the United States. The administration’s investment priorities.

“The Plan’s policies to stimulate supply are an important part of bringing home ownership within reach of Americans who today cannot find affordable housing because there are too few homes to sell in their communities,” the White House said.

Previous attempts by the administration to ease the housing crisis failed with the Build Back Better reconciliation package, which passed the House of Representatives. The Senate has yet to agree on a version of the package. Segments of the Biden administration’s plan are rollovers of plans included in the reconciliation package, including the plan to encourage secondary suites and the grant program for localities that adopt housing-friendly zoning.

The plan released Tuesday combines initiatives that will require congressional approval, such as tax credits for home rehabilitation, with actions that can be implemented immediately, such as using Department of Transportation funds.

The Biden administration has identified restrictive zoning as one of the main obstacles to increasing the country’s housing supply, along with a lack of attractive low-cost financing for new construction or the rehabilitation of existing units. .

“One of the most significant issues limiting housing supply and production is the lack of available and affordable land, which is largely driven by state and local laws and regulations regarding zoning and land use. soils that limit housing density,” the White House statement said.

The plan involves creating attractive financing options for less traditional housing construction instead of just large multi-family construction, including for secondary suites, construction and rehabilitation of single-family homes and small multi-family properties.

Proponents of building more housing said the plan is in line with what they have advocated for years.

“We commend the White House for joining the fight to put the issue of housing affordability at the forefront of the national economic agenda after the NAHB urged the administration to act on this vital national concern at the past few months,” the National Association of Home said. Builders President Jerry Konter said in a statement. “The plan contains many positive elements that would help address a host of affordability issues and improve financing options, and recognizes long-term headwinds, such as supply chain bottlenecks and chronic labor shortages in construction, repeatedly identified by NAHB members as holding back housing production.

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