Congressional negotiators have reached a bipartisan agreement on a major housing package that aims to expand supply and address affordability concerns while easing some of the industry's biggest objections to restrictions on institutional investors.
The compromise version of the 21st Century ROAD to Housing Act removes a provision that would have required certain build-to-rent investors to sell properties after seven years, a measure that builders and developers argued could discourage new housing construction. The package still includes restrictions targeting large institutional investors' purchases of existing single-family homes.
The bill is now positioned for final congressional action after months of debate over how to balance affordability concerns with the role of private capital in expanding housing supply.
The bill combines several housing proposals aimed at reducing barriers to construction, including changes related to manufactured housing, federal reviews and incentives for communities to increase housing production.
The debate around institutional ownership became one of the most closely watched elements of the legislation. Supporters of investor restrictions argued that large corporate buyers have contributed to affordability challenges by competing with individual homebuyers.
Sen. Elizabeth Warren, D-Mass., who helped develop the legislation with Sen. Tim Scott, R-S.C., previously argued that large investors should not be allowed to accumulate single-family homes at the expense of families seeking homeownership.
Industry groups, however, raised concerns that the original Senate language could have unintended consequences for housing supply, particularly in the growing build-to-rent sector.
The National Association of Home Builders (NAHB) opposed the earlier forced-sale provision, arguing that requiring investors to sell newly built rental homes could reduce production. The group said the provision could have cut single-family rental construction by tens of thousands of homes annually.
After lawmakers removed the forced-sale language, NAHB praised the revised package.
"NAHB congratulates congressional leaders for reaching a bicameral and bipartisan agreement to move forward a final version of the 21st Century Road to Housing Act," NAHB Chairman Bill Owens said.
"This landmark legislation would expand housing opportunities for buyers and renters, strengthen homeownership, and help tackle the affordability challenges facing communities nationwide."
The group had previously supported many elements of the bill, including provisions intended to streamline development and remove regulatory barriers, while pushing lawmakers to reconsider policies it viewed as potentially limiting new housing production.
The compromise also received support from housing finance and development groups that have pushed for measures to increase supply.
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