(WASHINGTON) — President Joe Biden’s administration this week took necessary — if incremental — steps to address the lack of affordable housing across the country, advocates and experts say.
The White House on Monday introduced the “Housing Supply Action Plan,” which aims through a combination of incentives, reforms, financial mechanisms and legislative lobbying to expand housing access for owners and renters amid still-soaring inflation. The administration staked a timeline on its work, saying that the plan would “help close America’s housing supply shortfall in 5 years, starting with the creation and preservation of hundreds of thousands of affordable housing units in the next three years.”
Housing and rental prices have continued to rise at the same time that the market, in many places in the U.S., has been challenged by a years-long lack of sufficient construction and inventory.
Against that backdrop, the White House’s new plan was met with praise by experts even as some of them stressed that progress would be slower than the administration had vowed.
“Our country’s facing a historic low supply of entry-level homes for sale,” said Chris Vincent, vice president of government relations and advocacy for Habitat for Humanity International. “And federal investments and administrative actions are really necessary to move this along. So we think it’s great and will have a big impact on urban, suburban and rural communities alike.”
Jeffrey Zabel, a professor of economics at Tufts University, said while the White House’s plan was a great first step, “It’s going to take a long time for any of this to have a real impact on the supply of housing.” Zabel predicted it will take at least a decade to achieve.
Prices — spurred in part by inflation — are a major pain point and are inextricably connected to issues with inventory. In April, housing costs rose 0.5%, the same as the month before, according to the Consumer Price Index (CPI). Over the last year, per the CPI, housing costs increased 5.1%.
Jerry Howard, CEO of the National Association of Home Builders, said for “potential first-time homebuyers who are the linchpin of … the housing markets, they are priced out of the market.”
It’s even more challenging for people with low incomes and for communities of color to afford housing, advocates said, highlighting the influence of historic discrimination.
“I think the [COVID-19] pandemic really unveiled the housing crisis that many Black, brown and immigrant communities have faced for a long time,” said Katie Goldstein, the director of housing campaigns for the Center for Popular Democracy. “I mean, really, we’re talking about a housing crisis where there’s been decades of racial discrimination and disinvestment by federal, state and private actors.”
A 2020 report from the National Low Income Housing Coalition found that “Black households account for 12% of all households in the United States and 19% of all renters, but they account for 26% of all renter households with extremely low incomes.” Hispanics likewise make up 12% of all households and 19% of all renter households, the report said, but are 21% of renter households with extremely low incomes.
The Biden administration aims with its new plan to help lower costs over time by increasing the amount of quality housing, the White House said in a statement on Monday: “This means building more new homes and preserving existing federally-supported and market-rate affordable housing, ensuring that total new units do not merely replace converted or dilapidated units that get demolished.”
The White House said it will incentivize states and localities to change their zoning and land-use regulations, launch new low-cost financing for new housing and preservation, improve and build upon the existing federal financing, secure the accessibility of affordable single-family houses for owner-occupants and work to fix housing materials and labor shortages.
A senior administration official told ABC News in an email that the new actions do not require additional funding. The administrative actions, the official said, include programmatic changes to programs already in place.
Minnesota Rep. Ilhan Omar, who separately reintroduced a bill that would help create millions of new housing units, was among the Democrats who applauded the Biden administration for its plan.
“Housing affordability is one of the biggest crises facing working families and a key driver of inflation,” Omar wrote in an email to ABC News. “I am thrilled the Biden Administration is taking steps to tackle the housing crisis, including to encourage better zoning laws, funding for manufactured housing, multifamily housing, and the construction of new single-family homes. … Housing is a human right. It’s time to treat it like one.”
Last year, Rep. Don Beyer, D-Va., cosponsored legislation to reform low-income housing credit. He also praised the new housing initiative for how it would “improve and expand financing options that will support affordable housing construction, while embracing a mixed-use strategy, and providing government-owned housing to owners who will live in them,” he said in an email to ABC News.
Beyond its administrative powers, the White House called upon Congress to enact legislative solutions, largely by approving President Biden’s trillion-dollar social spending and climate package, known as the Build Back Better bill, which passed the House but was rebuffed by Republicans and moderate Democrats in the Senate.
The White House says that spending package would also make crucial investments in public housing and create more construction jobs. The administration singled out the Unlocking Possibilities program, which was included in that bill and would create a Housing and Urban Development Department competitive grant program of $1.75 billion “to help states and localities eliminate needless barriers to affordable housing production.”
Experts say a comprehensive solution will ultimately require some kind of federal legislation.
“Only through a combination of administrative and Congressional action can the country truly resolve its affordable housing crisis,” Diane Yentel, the president and CEO of the National Low Income Housing Coalition, said in an email.
Noëlle Porter, the National Housing Law Project’s director of government affairs, also urged congressional action and highlighted the need for tenant protections.
“It’s a collective effort to get something like this to really work,” she said. “As advocates we will do every piece, every part in our power to braid funding sources together … but we need a significant investment in public housing and in tenant-based rental assistance.”
In proposals to expand housing access and affordability, a focus on tenants is essential in ensuring their rights and protections, Porter said.
She emphasized the need for action which guarantees that tenants who move back onto property that was once public but was privatized have the same affordability restrictions that the public property had.
Housing is a significant portion of what people spend their income on, Porter said. “As that cost expands, it cuts out, it pinches out, everything else we need to be able to buy.”
ABC News’ Conor Finnegan contributed to this report.
Copyright © 2022, ABC Audio. All rights reserved.
