Senators Reintroduce American Housing and Economic Mobility Act
Senator Elizabeth Warren (D-MA) and colleagues recently reintroduced the American Housing and Economic Mobility Act to confront the affordable housing shortage. According to an independent analysis of the legislation from Mark Zandi, Chief Economist of non-partisan Moody's Analytics, the bill would build or rehabilitate more about 3 million units over the next decade and fully close the current gap between affordable housing demand and supply; create 1.5 million new jobs at its peak impact; bring down rents for lower-income and middle-class families by 10 percent -- saving families an average of $100 per month -- and produce no long-term deficit impact.
Cosponsors of the bill include Senators Kirsten Gillibrand (D-NY) and Ed Markey (D-MA). The bill has a House companion bill co-sponsored Democratic Representatives Cedric Richmond (LA), Elijah Cummings (MD), Gwen Moore (WI), Barbara Lee (CA), Ayanna Pressley (MA), Susan Wild (PA), Mark Pocan (WI), Eleanor Holmes Norton (DC), Steve Cohen (TN), Rashida Tlaib (MI), Jamie Raskin (MD), Ro Khanna (CA), Joseph Kennedy (D-MA), and Suzanne Bonamici (OR).
The bill would help address the shortage of millions of affordable homes nationwide by investing $445 billion over 10 years in the Housing Trust Fund to provide up to 2.1 million homes for low-income families. It invests an additional $25 billion over 10 years in the Capital Magnet Fund — leveraged 10:1 with private capital — to build up to 835,000 new homes. The bill would put $4 billion in a new Middle-Class Housing Emergency Fund to build homes for middle-class buyers and renters where there is a supply shortage and housing costs are rising significantly faster than incomes. It would invest $523 million in rural housing programs, doubling the number of home loans available through the programs and preserving 450,000 affordable rural rental units, and invest more than $2.5 billion to build or rehabilitate 200,000 homes for Native Americans and Native Hawaiians.
Building on the legislation introduced in the 115th Congress, this bill would invest more than $3.5 billion in the Public Housing Capital Fund to help maintain critical affordable units and change the rules to stem the pipeline of distressed FHA, Fannie May, and Freddie Mac mortgages or government-owned homes to private equity firms. The current legislation also would extend the down payment assistance program to former residents of officially segregated communities who were displaced from their neighborhood by foreclosure on an abusive loan during the subprime crisis or by a natural disaster.
To fully offset the cost of this historic effort, the bill would return the estate tax thresholds to their levels at the end of the George W. Bush administration and institute more progressive rates above those thresholds. These changes would affect only about 14,000 of the wealthiest families in the country.
Senator Warren first introduced the American Housing and Economic Mobility Act in September 2018.