(NewsInsights.org) – Inflation over the past year has affected many aspects of life, but a recent study indicates that it has most significantly influenced Americans’ ability to afford housing year-on-year. To address the growing affordable housing crisis, President Joe Biden is proposing measures to help more Americans reach the dream of home ownership.
In early December, Lael Brainard, Biden’s head of the National Economic Council since February, addressed the National Housing Conference to discuss the challenges many Americans face each month due to rising rents and mortgages. She told conference members the administration hoped to work with state, local, and industry partners to effect changes.
Brainard told conferees that one of the first high-priority administration goals included increasing the supply of affordable housing. Some industry experts claim new housing starts have continued shrinking since the 2007 mortgage banking crisis, causing an overall shortfall in supply and increased prices. Inflation exacerbated the problem by increasing the costs of new mortgages and discouraging existing homeowners who purchased at lower interest rates from selling and moving.
In coordination with Democratic lawmakers, the administration proposed two measures. First, they introduced The Affordable Housing Credit Improvement Act, setting rents at less than 24% of an area’s median monthly income. The effect would increase affordable housing to as many as 1.2 million families over the next decade. Second, they introduced The Neighborhood Homes Investment Act, which would revitalize neighborhoods while promoting home ownership to up to 500,000 new households. Lawmakers introduced the bills in the Senate earlier this year, but the measures haven’t received any attention since their introductions.
Yet, Biden launched his Housing Supply Action Plan in July. The program provides grant incentives to state and local partners to assist in rezoning to allow builders to repurpose existing buildings, like offices, as homes, provides new mechanisms for homeowner financing, expands existing forms of federal funding, prioritizes the construction of new homes, and ensures that the government will sell more government-owned homes to owners who will live in them.
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