Treasury Secretary Janet Yellen recently announced a significant plan to allocate $100 million over the next three years to support the construction of thousands of affordable housing units. Speaking at an event in Minneapolis, Yellen emphasized that housing is at the core of the American dream, but the current high housing costs have severely impacted the quality of life for many middle-class families.
According to the latest Case-Shiller Home Price Index data, U.S. home prices reached another historic high in April this year. Meanwhile, mortgage rates are nearing their peak levels of the past two decades, leading many prospective homebuyers to remain on the sidelines rather than enter the market.
Shortage of housing supply is one of the primary factors driving up housing prices. According to estimates by Freddie Mac, the U.S. currently needs at least 1.5 million additional housing units to meet market demand.
Yellen emphasized that the Biden administration has been committed to reducing housing costs by increasing the number of housing constructions.
The Treasury Department's new measures also include strengthening guidance on how states and localities can effectively use COVID-19 recovery funds to increase housing supply, and simplifying existing affordable housing investment programs.
Carl Harris, Chairman of the National Association of Home Builders (NAHB), expressed support for the government's efforts to increase housing supply, but he also emphasized the need to further reduce current excessive regulations hindering new housing projects.
realtor.com
Harris stated, 'We appreciate the Biden administration's focus on increasing housing supply to reduce housing costs. NAHB believes that increasing housing production is the best way to address the national housing affordability crisis.'
He referred to a recent NAHB ten-point plan that proposes measures to be implemented at local, state, and federal levels to remove barriers hindering new housing and apartment projects, thereby alleviating the housing affordability crisis.
Harris further noted, 'Implementing these viable solutions, including reducing regulations, simplifying local zoning requirements, and adopting cost-effective and reasonable building standards, will help builders increase housing supply nationwide and reverse the trend of rising housing costs.' He has repeatedly called for reducing regulatory restrictions to stimulate the housing market.
Earlier this year, Harris expressed concerns about some of the Biden administration's policies, particularly energy efficiency requirements imposed on new housing, suggesting that these requirements could increase construction costs with minimal impact on overall energy use control.
The Biden administration, however, emphasizes that new energy efficiency requirements will help residents save on utility expenses, reduce energy consumption and pollution, enhance housing resilience in extreme weather events, thereby improving living comfort and health.
Yellen called on Congress during her Minneapolis speech to support Biden's various housing policy proposals, including tax exemptions for first-time homebuyers and support for affordable housing development.
Currently, the Biden administration is actively seeking to address the national housing affordability issue through multiple measures. Meanwhile, Republican Donald Trump opposes easing single-family zoning restrictions, advocating for the construction of new cities on federal land to address the increasing housing demand issues."
