By Nathalie Voit
The Biden-Harris administration is introducing new measures to ease the U.S. housing supply crisis, according to remarks from the White House issued on May 16.
“This is the most comprehensive of all government efforts” to close the U.S. housing supply shortfall, the administration said on Monday. The impacts are particularly harsh on low- and moderate-income households and “people and communities of color,” the White House said.
According to data from Moody’s Analytics, the country is short of more than 1.5 million homes. The Housing Supply Action Plan aims to close this gap in five years.
The administration plans to bolster the supply of available quality homes by supporting federally-financed affordable housing projects and policies to reduce the cost of homeownership, such as rental assistance and down payment aid. The measures are meant to bring homeownership within reach for every American who cannot find an affordable home for sale in today’s dire macroeconomic environment.
Rewarding jurisdictions that have reformed zoning and land-use policies, deploying new financing options for affordable units, and expanding and improving existing forms of federal financing are among the actions the administration plans to undertake. The plan will also ensure government-owned housing goes to tenants who will live in them or non-profits who will rehabilitate the buildings, rather than large institutional investors.
President Joe Biden also plans to work with the private sector to accelerate the construction of new housing units to build the most new homes since 2006.
The measures are part of a broader effort to tackle economic-wide inflation. According to the April Consumer Price Index, the index for shelter rose 0.5% last month as rising rent payments coupled with falling supply converged to increase the cost of housing further.
Shelter costs account for about one-third of the CPI weighting, making rent prices a useful proxy for overall inflation.
