Housing finally becomes a focus in a presidential campaign

Democratic presidential candidate, U.S. Vice President Kamala Harris speaks to reporters outside of Primanati Bros. Restaurant on August 18, 2024 in Moon Township, Pa.

Democratic presidential candidate, U.S. Vice President Kamala Harris speaks to reporters outside of Primanati Bros. Restaurant on August 18, 2024 in Moon Township, Pa. Anna Moneymaker via Getty Images

 

Connecting state and local government leaders

With home prices at record highs, the Harris-Walz campaign has outlined a policy agenda that it says will spur construction of 3 million new units in four years.

From President Joe Biden’s last-minute decision to drop out of the election to former President Donald Trump’s legal troubles, many aspects of the current election cycle are unprecedented. But for Jim Tobin, president and CEO of the National Association of Home Builders, this year is notable for another reason.

“For the first time in my career, housing and housing supply is front and center in a presidential campaign,” said Jim Tobin, president and CEO of the National Association of Home Builders. ”That's really important because housing has become so far out of reach for so many Americans [and] we've got to solve that problem.”

Home prices hit record highs this year and more Americans are dedicating large shares of their incomes to housing costs. The country is facing a shortage of between 4 million and 7 million units, causing rent and home prices to skyrocket. 

The Harris-Walz campaign recently outlined a slew of proposals it hopes will spur construction of 3 million new units in four years. As part of the campaign’s broader economic agenda, the housing plans include efforts to bolster the housing supply, such as strengthening the Low-Income Housing Tax Credit and creating a new tax incentive for developers that build starter homes. A proposed $40 billion innovation fund — a sum that doubles a similar initiative under the Biden administration — would similarly “empower developers and homebuilders to design and build rental and housing solutions that are affordable,” according to a campaign press release. 

These policies are notable in that they specifically create affordable housing, said Janneke Ratcliffe, vice president of the Housing Finance Policy Center at the Urban Institute. There’s an overall shortage of units across the country, and the units that are being built are typically too expensive for the average household. Given everything that goes into development — land prices, regulatory burdens, materials and labor costs — it’s more economical for builders to develop high-end units rather than homes affordable to lower- and middle-income households, she said.

Harris is also looking to streamline permitting processes at the state and local level. Research shows that easing regulations around development — such as reducing parking minimums and single-family zoning — is a powerful tool in spurring development. 

The most important role the federal government can play in this effort is to provide funding to update regulations, Ratcliffe said, and leave reforms up to state and local governments. Flexible funding through initiatives like the Pathways to Removing Obstacles Housing Program, or PRO Housing, which grants funding to communities that are actively working to expand and preserve housing.  

“There's a lot of things that the local governments can do that address the specific needs and situations of their market,” she said. “The federal funding helps motivate, helps make it possible, but it leaves a lot of the decision making to the locals.”

Regulatory burdens across all levels of government increase development costs by about 24% for a single-family unit and 41% for multifamily, Tobin said. Most of that comes from local requirements, but not all of it. The National Association of Home Builders would like to see Harris go further and address the federal regulations that slow down development, Tobin said. A new regulation from the Biden administration, for example, requires that new homes sold to Federal Housing Administration borrowers must meet 2021 energy codes, a stipulation that reduces homeowner energy bills but adds tens of thousands of dollars to development costs. 

“On day one for either administration, that's our number one ask: roll back that regulation,” he said.

So far in this campaign, Donald Trump has said little about his plans to tackle the housing crisis. He has suggested the president should play a role in setting interest rates, a move that could impact mortgages. The 2024 Republican Party Platform also proposes cutting interest rates, offering tax incentives and support for first-time homebuyers, and reducing regulations, but offers few details. Both campaigns have also suggested opening up some federal lands for housing development. 

Trump’s advantage is he has a track record he can point to, including reforming federal regulations to streamline development and establishing the White House Council on Eliminating Regulatory Barriers to Affordable Housing.

Even if new policies spur development, it will be years before many of those units come online. In the meantime, the competition to buy homes is stiff, Ratcliffe said, and it’s difficult for first-time buyers who rely on financing to compete against cash buyers or real estate investors. That’s where Harris’ plan for a downpayment assistance program — which would give some first-time buyers up to $25,000 with additional support for first-generation buyers — could be a game changer for some households. Harris’ plans to crack down on corporate landlords could also remove formidable competitors from the market and build on efforts already moving through Congress

Still, a lot of what happens over the next few years will play out in neighborhoods and city halls, Ratcliffe said.

“The federal government can lead the way, but a lot of the solutions rely upon what happens at the local level,” she said. “Real estate is fundamentally a local situation.”

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.