The 21st Century ROAD to Housing Act, hailed as the most significant housing legislation in decades, primarily seeks to increase housing supply by streamlining processes and promoting alternative housing solutions. The law became effective at midnight on Friday, July 11, without President Trump's signature, as he withheld approval due to an unrelated voting bill dispute. Despite its bipartisan support, with votes of 358-32 in the House and 85-5 in the Senate, its immediate effectiveness in lowering housing costs is doubted by many experts, largely due to its limited financial provisions for such a widespread problem.
The legislation encompasses 47 proposals, aiming to increase housing supply, reduce costs, and expand access to affordable homes. Key provisions include promoting manufactured housing, facilitating office-to-apartment conversions, and authorizing a pilot program for grants and forgivable loans to repair older homes. It also introduces an unprecedented restriction, prohibiting investors owning over 350 single-family homes from making new purchases, though it does not mandate the sale of existing properties.
Additional components of the act involve overhauling several federal housing programs, streamlining environmental reviews, and raising FHA multifamily loan limits for the first time in over 20 years. It also authorizes a three-year Community Development Block Grant-Disaster Recovery Program and includes an FHA small-dollar mortgage pilot below $100,000. The Consumer Financial Protection Bureau is tasked with studying how loan originator compensation rules affect the availability of these small-dollar mortgages.
While supporters, including White House press secretary Karoline Leavitt, laud the law as comprehensive reform, critics argue that the federal government's limited control over local zoning and building regulations, coupled with the legislation's modest financial allocations, will hinder its ability to significantly impact the estimated one million to six million unit housing shortage. The bill is viewed as a hodgepodge of measures designed to incrementally speed up building rather than a transformative solution akin to the 1965 act that created HUD.
