ALTA Statement on Biden Administration Housing Supply Action Plan

May 17, 2022

The Biden administration on May 16 announced legislative and administrative actions to address the U.S. housing supply shortage. This plan includes reforming zoning and land-use policies, as well as expanding federally backed financing for affordable housing and directing grants to localities that encourage construction.

ALTA commended the administration’s efforts to ease the burden of housing costs for more Americans.

“As the president’s Housing Supply Action Plan notes, the most important action that can be taken to reduce costs and improve affordability is to boost the supply of quality housing in communities nationwide,” said Diane Tomb, ALTA’s chief executive officer. “ALTA looks forward to working closely with the Administration as various initiatives within the plan develop. We are committed to assisting American families achieve and protect the dream of homeownership across the United States.”

The action plan notes that today’s rising housing costs are years in the making. Fewer new homes were built in the decade following the Great Recession than in any decade since the 1960s. In addition, the constrained housing supply has failed to keep pace with demand and household formation. This mismatch between housing supply and housing demand grew during the pandemic. While estimates vary, Moody’s Analytics estimates that the shortfall in the housing supply is more than 1.5 million homes nationwide.

“This shortfall burdens family budgets, drives up inflation, limits economic growth, maintains residential segregation, and exacerbates climate change,” the Biden administration said in its plan. “Rising housing costs have burdened families of all incomes, with a particular impact on low- and moderate-income families, and people and communities of color.”

Under the plan, the Biden administration announced it will:

  • Reward jurisdictions that have reformed zoning and land-use policies
    • Commentary from the plan: One of the most significant issues constraining housing supply and production is the lack of available and affordable land, which is in large part driven by state and local zoning and land use laws and regulations that limit housing density. Exclusionary land use and zoning policies constrain land use, artificially inflate prices, perpetuate historical patterns of segregation, keep workers in lower productivity regions, and limit economic growth. Reducing regulatory barriers to housing production has been a bipartisan cause in a number of states throughout the country. It’s time for the same to be true in Congress, as well as in more states and local jurisdictions throughout the country.
  • Deploy new financing mechanisms to build and preserve more housing where financing gaps currently exist
    • Commentary from the plan: A second, significant barrier to increasing housing supply is a lack of attractive and low-cost financing for new construction and rehabilitation – particularly for units that are affordable. While the federal government currently offers a range of financing options for large multifamily development, market gaps exist for the construction and rehabilitation of single-family homes, 2-4-unit properties, ADU construction, manufactured and modular housing delivery, and smaller multifamily properties. Financing for these housing types has the potential to boost supply in constrained markets, and create location-efficient, modest density that can improve labor market outcomes and reduce greenhouse gas emissions--particularly when paired with state and local policies that remove barriers to where these kinds of housing can be located.
  • Expand and improve existing forms of federal financing
    • Commentary from the plan: Multiple forms of federal financing have played a critical role over the years in boosting affordable housing supply. But more production is needed to make up for more than a decade of underbuilding before the pandemic, and existing programs need to work more effectively and efficiently in order to boost housing production at a pace that will close the housing shortfall in five years.
  • Ensure that more government-owned supply of homes and other housing goes toward owners who will live in them
    • Commentary from the plan: Beyond financing challenges, in recent years, the share of single family home purchases by investors has grown-–comprising more than 25% of all purchases nationally in some months of 2021, with an even higher share in certain markets, like Atlanta, San Jose and Phoenix. Well over half of these purchases were made by investors with more than ten properties, and almost a quarter of these purchases were made by investors with over 100 properties. Large investor purchases of single-family homes drive up home prices for lower-cost starter homes, making it harder for aspiring first-time and first-generation home buyers, among others, to access wealth-building opportunities from homeownership.

The Biden administration aims to close the shortage of available homes in five years. Additionally, the administration said it plans to “work with the private sector” to ensure construction is completed this year on the highest number of new homes since 2006. 


Contact ALTA at 202-296-3671 or [email protected].