The Biden administration is announcing an action plan Monday aimed at boosting the supply of affordable housing amid high inflation.
Taken together, administration officials said, the actions announced will help close the affordable housing gap and “ease the burden of housing costs,” noting that housing prices are a key driver of inflation.
The move is the latest step by the administration to show it is working to get a handle on high prices nationwide. US home prices continued to surge higher in February, according to the most recent data from the S&P CoreLogic Case-Shiller US National Home Price Index. Prices rose 19.8% year-over-year in February, an even higher rate than the 19.2% growth seen in January.
President Joe Biden said last week tackling inflation is a top domestic priority for his administration. He attacked Republicans for a plan put out by the head of the Senate GOP’s campaign arm rather than laying out any new proposals to combat the worst inflation the country has seen in 40 years.
Among the new policies announced Monday are steps to leverage existing federal funding to encourage state and local reform to zoning and land use policies, a senior administration official told reporters, via funding from the bipartisan infrastructure law and the Department of Transportation. A second official noted that the administration will take steps to improve federal financing mechanisms for manufactured housing, multifamily housing, and the construction and rehabilitation of single-family homes.
There are also steps to finance or produce more manufactured housing, accessory dwelling units, also known as garage apartments, basement apartments or backyard homes -2-4 unit properties and smaller multifamily buildings, according to a White House fact sheet.
The administration will also direct supply of affordable housing for owner-occupants, which the second administration official said is aimed at addressing “the growing trend of large institutional investor purchases of single family homes.”
And the administration will “work with the private sector to address supply chain challenges and improve building techniques to finish construction in 2022 on the most new homes in any year since 2006,” the fact sheet said.Housing and Urban Development Secretary Marcia Fudge will join Commerce Secretary Gina Raimondo and other Biden officials to address supply chain disruptions for building materials with industry leaders, the fact sheet said.
The actions will “help close the housing supply shortage in five years,” the first senior official said, and will be paired with a series of proposed legislative measures to help ease costs. The legislative moves, which will require congressional approval, include tax credits for low- and middle-income home buyers and a proposed $25 billion for grants for affordable housing production.
Fudge will join Sen. Sherrod Brown and Rep. Joyce Beatty, both Ohio Democrats, for an event in Columbus, highlighting the new plan on Monday.
“The Plan’s policies to boost supply are an important element of bringing homeownership within reach for Americans who, today, cannot find an affordable home because there are too few homes for sale in their communities. And it will help reduce price pressures in the economy, as housing costs make up about one-third of the market basket for inflation, as measured by the Consumer Price Index,” the White House said in a fact sheet.