Congress Passed the Broadest Housing Bill in Three Decades

It moves in the right direction. Trump's own tariffs and immigration policy are moving the other way.

To many people’s surprise, Republicans and Democrats in both the House and the Senate agreed earlier this month on a meaningful piece of legislation addressing a problem many Americans feel directly: the cost of housing. Ninety-two percent of members who voted supported the broadest federal housing package in three decades, a signal that both parties in Congress see affordability as a problem voters will judge them on in November. President Trump neither signed the bill nor vetoed it, apparently still angry that Congress had not first passed his voter identification bill, so it became law without him.

Owning a home has long been a central marker of the American Dream, proof that hard work adds up to something stable. That marker is slipping out of reach for a generation. Younger Americans, watching home prices outpace their wages for years running, are increasingly skeptical they will ever own one at all.

There is broad agreement about the underlying problem: the country has not built enough housing, and that shortage has pushed prices up. Two barriers explain why. The first is approvals: developers can spend years navigating environmental review, zoning rules, and permitting before construction even starts. The second is financing: even an approved project still has to make financial sense, and if the costs are too high or the money too hard to secure, it does not get built.

Rather than pass a handful of narrow fixes that would each do little on their own, this bill goes after the system that produces both barriers.

Cutting the Red Tape

Approvals are often the first place a project stalls. The new law waives federal environmental review for infill development, building on vacant or underused lots within existing neighborhoods rather than open land at a city’s edge, and for adaptive reuse, converting existing buildings like offices into housing. It also requires every community that receives federal housing money to publish a public list of vacant land the local government itself owns that could be developed.

Local governments retain authority over zoning, the rules that determine what can be built where and how dense it can be, and the ability to weigh that authority against environmental review, resident input, and health and safety. The new law tries to make it worthwhile for a community to reconsider those rules, whether that means allowing more units per lot, streamlining permitting, or approving projects faster. It does this two ways: a new competitive grant program, which still needs Congress to appropriate money before it exists in practice, and small increases or decreases in Community Development Block Grant funding, an existing program that already receives annual funding, tied to how quickly a community permits new housing.

Making the Math Work

The second barrier is financing. The Federal Housing Administration insures apartment loans so private lenders can offer better terms than they otherwise would. Its per-unit insurance cap had been stuck at levels set decades ago, in some cases as low as $70,200, while construction costs kept climbing. The new law raises that cap to $308,880 and ties future increases to actual building costs. It also lets local governments spend existing federal block grant money on building new affordable housing, not just repairing what already exists, and loosens eligibility in a separate program that helps finance affordable rentals. These are changes to programs that are already funded and already moving money.

What Got Traded Away

The Senate and the House had very different ideas about the role of corporate-owned housing. The Senate, shaped in large part by Senator Elizabeth Warren, wanted to limit corporations’ ability to hold onto the homes they built by requiring them to sell to individual families, with renters getting first chance to buy. The House wanted corporations to have a bigger role in the housing market. What survived is a ban on large investors buying existing homes on the open market, but nothing stops them from building and holding new ones indefinitely. Because only the largest firms can afford to hold thousands of homes as long-term rentals, the practical effect favors companies like Blackstone and Invitation Homes over smaller investors trying to grow into the market.

Still Not Enough

While this legislation moves in the right direction, additional efforts are needed to fix the housing sector. In fact, two federal policies are making it more difficult to build new affordable housing: immigration and tariffs. Immigration enforcement has pulled construction workers off job sites across the country this year, shrinking the workforce this law needs to succeed. Tariffs on steel, lumber, and other building materials have added thousands of dollars to the cost of a single home, working against the same affordability this bill was written to improve. Affordability is what Americans said they wanted. A bill that moves in the right direction is not the same as delivering it.

Sources

1. Congress.gov, 21st Century ROAD to Housing Act (H.R. 6644), bill text and vote record

2. NPR, “Housing Affordability Bill Becomes Law Without Trump’s Signature,” July 2026

3. Bipartisan Policy Center, “Inside the Deal: What’s in the Final 21st Century ROAD to Housing Act”

4. NOTUS, “Elizabeth Warren Led a Key Housing Bill. She Might Lead to Its Downfall.,” March 2026

5. Bloomberg, “Corporate Landlords Targeted by Trump Now Poised for Growth,” July 2026

6. Fortune, “Trump’s Immigration Crackdown Is Worsening the Construction Labor Shortage Threatening Build Costs,” May 2026

7. Center for American Progress, “Trump Administration Tariffs Could Result in 450,000 Fewer New Homes Through 2030”

8. National Association of Home Builders, “How Tariffs Impact the Home Building Industry”