After months of debate — it looks like Congress has finally struck a deal to pass a monumental housing bill that addresses the national affordability challenges and improves supply. It also appears to be welcome news for the commercial real estate industry, as the previous restrictive measures on build-to-rent properties have been eased.
The 21st Century ROAD to Housing Act passed the Senate unanimously on Monday, with key provisions including streamlining federal and local housing processes, allowing builders to get permits faster, boosting production in urban and rural areas and modernizing HUD programs, according to a one-page report from the United States House Committee on Financial Services.
But the biggest fear was over the original language adopted by the Senate, which barred entities that control 350 or more single-family rentals from acquiring additional units and forced divestiture after seven years if that amount was exceeded. This provision has received pushback from BTR and SFR developers, with a ResiClub survey revealing that the fears were leading to the stalling of thousands of projects and how the bill would impact long-term investment.
Those fears appear to be quelled at least for now, even though the 350-unit limit remains. That's because the seven-year sale requirement has been eliminated from the passed Senate version, according to a report from CNBC.
The Senate approval has the blessing of Kevin Brown, president of the residential and CRE nonprofit National Association of REALTORS, as highlighted in a testimony to Congress today. While noting that the ROAD to Housing Act is slated to become one of the most impactful housing measures implemented nationally in decades — he added that more can be done to address the affordability crisis. This includes expanding financing options for homes, improving down payment assistance and providing a boost to the capital gains exemption on primary residence sales.
"REALTORS® [members of NAR] look forward to working with Congress on additional reforms and policies, such as the More Homes on the Market Act, a bipartisan bill that would double the capital gains exclusion thresholds on a primary residence for the first time in nearly 30 years while adjusting the caps to reflect future inflation," Brown said.
While the House has yet to vote on the amended version of the legislation, it is expected to do so for final passage by the end of the week, which would send it to President Trump's desk for signing, according to CNBC.
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