New Housing Act Aims to Boost Supply, Cut Red Tape

The 21st Century ROAD to Housing Act, which became effective on July 11, introduces a comprehensive set of provisions designed to facilitate housing construction and reduce regulatory burdens. This nearly 400-page legislation aims to streamline federal reviews, bolster support for factory-built housing, expand overall housing supply, and encourage local governments to simplify housing development processes. The act also includes a prohibition on institutional investors purchasing additional homes, though it provides essential exemptions for build-to-rent (BTR) projects. It recognizes all housing types as integral to the solution, encompassing for-sale and rental properties, market-rate and below-market-rate units, and multifamily structures. This inclusive approach extends to traditional site-built homes as well as off-site construction methods like manufactured homes, modular housing, and accessory dwelling units (ADUs).

While acknowledged as a significant initial step toward driving change, many leaders in the homebuilding industry believe further action is necessary, particularly at the local level where the majority of regulatory obstacles to new housing emerge. Ed Brady, president and CEO of the Home Builders Institute, expressed enthusiasm for the bill, stating, "Housing has become top of mind for many legislators, but just as importantly, for many states and many local governments. This bill addresses a lot of that. Overall, I think we’re thrilled." He emphasized that this legislation represents the first phase of a longer-term process and expressed hope for continued dialogue regarding its implementation and identification of further needs.

The bill's provisions specifically target supply-side enhancements. The 21st Century ROAD to Housing Act incorporates multiple measures intended to simplify the construction of diverse housing types. Collectively, these initiatives address regulatory impediments across federal, state, and local government levels, with the objective of making home construction more efficient, rapid, and cost-effective. Several sections within the housing bill are dedicated to streamlining the review processes for federally funded residential projects, aiming to accelerate development timelines and reduce associated costs.