The Senate on Monday passed a bipartisan measure aimed at lowering housing costs by streamlining construction and permitting, ending months of fraught negotiations on a priority for both parties ahead of November’s midterm elections.
The 21st Century Road to Housing Act would limit investors’ ability to buy homes, waive some federal permitting rules in a bid to ease new construction, and authorize pilot programs to facilitate grants for home improvements and planning affordable housing. It passed the Senate overwhelmingly, with a vote of 85-5, and now heads to the House of Representatives.
The legislation comes as Democrats and Republicans prepare for November’s midterm elections, in which concerns about affordability are expected to loom large in the minds of the voters who will decide control of Congress for the final two years of Donald Trump’s term.
A shortfall in construction of new homes is seen as a key driver of housing costs, which have crept higher in recent years. Last year, House and Senate lawmakers began working on legislation that could draw the bipartisan support needed to pass, but wound up producing competing bills, creating an unusual standoff between the chambers.
First of all, “crept higher?” Maybe somewhere, but locally, “surged” is more accurate.
That’s a mere quibble; the larger issue is the reality of what passed. Notwithstanding that this is election posturing that won’t actually affect prices before the election (and, of course, Trump’s threat that he won’t sign anything before the Orwellian “Save America Act” is on his desk), the bar is set absurdly high:
The version the Senate approved on Monday combines aspects of both chambers’ bills, and includes language banning investors from buying single family homes if they already own 350 or more properties …
Individual investors not distorting the market have nowhere near 350 properties in their portfolios. I wouldn’t know where to look for reliable figures in terms of average holdings, but 5-10 seems a far more reasonable cap that would actually cause structural pricing changes.
Left unsaid is whether institutions will be required to disgorge 351-plus (highly unlikely) and the timeline thereof. In short, this locks in the status quo and only quells further distortions.
Looks good on the campaign trail (“Look, I voted for something that looks like a fix if you squint!”), but does nothing about the ongoing issue that got us into this mess.
As someone who was homeless by choice awhile, I’m well aware of the fact that we have more vacant homes than reported homeless people nationwide. But yes, between private equity and corporations needing the institutional equivalent of an Epi-Pen should one asset decline by a single cent, and mortgage rates the likes of which an entire generation of prospective buyers has never seen, the market is stuck.
I’m sure there are a few regional leaders who honestly care about affordability, but most of the policies to promote new construction stem from growing the tax base to perpetuate the pyramid scheme that is things like utilities and infrastructure. It’s like luring manufacturing “to create great jobs!” – except without any tax breaks. Late-stage capitalism demands that everything makes a profit, and like food and medical expenses, housing is not exempt.
Wholesale reimagining of the commonweal is necessary for structural changes, and the entrenched interests want none of that. Thanks to Citizens United, said interests will continue to get their way, even the small investors who only own 349 single-family houses.