A coalition of trade organizations representing housing providers, lenders and residents sent a letter to the Biden administration and members of Congress detailing bipartisan policies that can cost-effectively expand housing supply while improving housing equity and opportunity.
“It is critical that we start now to enact policies that will incentivize new housing production and preservation,” said the letter. “We, therefore, recommend that policymakers immediately move forward on the following measures that would go a long way to increasing the nation’s housing supply and, therefore, have a positive impact on the housing affordability crisis.”
The trade groups called for the passage of multiple bills proposed by members of Congress, including The Yes In My Back Yard (YIMBY) Act and the Housing Supply and Affordability Act, and called for new efforts to address “exclusionary zoning and harmful land use policies” while revitalizing and enhancing Opportunity Zones.
The trade groups repeatedly praised the Biden administration in the letter, praising its Housing Supply Action Plan as a “thoughtful proposal that rightly acknowledges that there is no single solution to our housing shortage.” Still, the letter warned that “certain revenue-raising proposals included in the FY25 Budget that would negatively impact the housing industry and ultimately could limit the supply of housing.”
“There are various estimates regarding the extent of the housing shortage, but all agree that housing construction has not kept pace with demand for quite some time,” the letter stated. “This shortage remains despite extremely high levels of housing construction during the past few years. However, we are seeing significant pullbacks in construction of new communities in recent months, which is a result of the combined effects of economic uncertainty and elevated labor, insurance, material and financing costs. We simply do not have enough homes to meet this long-term demand—this housing shortage is immense, widespread, and enduring.”
Among the organizations signing the letter were the National Association of Realtors, the Mortgage Bankers Association, the National Association of Home Builders, the American Seniors Housing Association and the Manufactured Housing Institute.
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Considering the government caused, or at least allowed, the crash of 2008 to happen, this is very disturbing. More government meddling is not the answer. Getting back to the economy we had before covid should be the goal. Remember also that the government took over the student loan program and within a decade there was a “student loan crisis.”
One action that could be taken would be to pass the bi-partisan, Panetta-Kelly bill that would double the sum that homeowners could exclude from their taxes when they sell. Current levels are $250,000 (single) and $500,000 (married). In reality, I would prefer that they amend the bill so that any amount over these limits would also remain tax free provided all the funds were rolled into the purchase of another property. This is how it was before the current tax law was passed in 1996. The ability to keep some equity tax free helps millions of people wherever they live.
This seems like a no-brainer to me, except I would put a deadline on the amount of time homeowners have to take advantage of it. That would have an impact on the housing shortage immediately.