On Aug. 13, the Biden administration announced a series of measures aimed at reducing housing costs by streamlining federal regulations and accelerating the construction of affordable homes. The new actions are part of President Joe Biden’s broader strategy to address the nationwide housing shortage and ease the financial burden on American families.
The administration’s Housing Supply Action Plan, launched last year, has led to more homes under construction than ever in the past five decades. The administration said it aims to build over two million new homes to alleviate pressure on the housing market, which has seen soaring prices and rents due to a lack of supply.
As part of the new measures, the Department of Housing and Urban Development (HUD) announced that it’s making $100 million available through its Pathways to Removing Obstacles to Housing (PRO Housing) program. The grants will help communities identify and eliminate barriers to affordable housing development, such as restrictive zoning laws and lengthy permitting processes.
The Treasury Department and HUD have also introduced changes to the Federal Financing Bank’s Multifamily Risk Sharing Program to provide more significant interest rate predictability for state and local housing finance agencies. Administration officials said the improvement should lower the cost of financing new housing developments and make more projects financially viable.
The Department of Transportation (DOT) has also issued new guidance to simplify the loan process for residential projects near transit hubs. This includes allowing certain projects to bypass detailed environmental reviews, potentially reducing approval times by several months. Meanwhile, the Advisory Council on Historic Preservation (ACHP) has proposed tools to expedite historic preservation reviews for federally funded housing projects, which could lower costs and speed up the delivery of affordable housing, especially in historically significant areas.
In another move, HUD is launching a Legacy Challenge to encourage communities to use up to $250 million in low-cost loans through the Section 108 Loan Guarantee Program for housing investments, including converting commercial buildings into residential units. In a fact sheet, the White House said the program offers flexible terms to attract more participants.
Finally, HUD is advancing updates to its Manufactured Home Construction and Safety Standards, allowing for the first time the construction of duplexes, triplexes, and fourplexes under the HUD Code. The change is intended to lower costs and increase housing density in urban areas.
According to the fact sheet, the administration has already facilitated nearly $20 billion in housing investments through the American Rescue Plan and other federal programs. It pushes state and local governments to follow suit by repurposing land and easing regulatory constraints.
