The 21st Century ROAD to Housing Act cleared the House in a sweeping 396-13 vote, advancing what could become the biggest housing legislation in more than 30 years.
The bill passed with strong bipartisan support after clearing the Senate in March, and the Senate is expected to hold a final passage vote before the House follows suit later in the week.
Trump had urged lawmakers to pass the Senate version of the bill, which includes language codifying his executive order restricting large Wall Street investment firms from purchasing single-family homes.
The legislation tackles the housing crisis from multiple angles, including expanding construction loans, loosening local permitting rules, expanding manufactured housing options, and curbing institutional ownership of single-family homes.
The Senate version includes a restriction on large institutional investors, defined as those owning 350 or more single-family homes, from purchasing additional single-family properties.
However, some economists argue that banning large investors may do little to lower home prices, and could actually reduce rental supply in neighborhoods where many residents cannot afford to buy.
Large institutional investors own just 0.7% of America’s 92 million single-family homes, according to John Burns Research and Consulting, making their overall market impact relatively limited.
Many homes that large investors divest would likely be purchased by smaller landlords rather than first-time buyers, said Daryl Fairweather, Redfin’s chief economist, limiting the practical benefit for aspiring homeowners.
The House version kept the Senate’s broader limits on institutional investors but eliminated the requirement that build-to-rent and renovate-to-rent developers sell those properties within seven years.
That Senate provision had drawn fierce opposition from the National Association of Home Builders and other industry groups, who argued it would devastate the build-to-rent market and reduce housing supply.
House negotiators replaced the forced-sale requirement with a lighter measure, creating a hotline for tenants living in properties owned by large institutional investors.
The bill also relaxes regulations on manufactured homes, allowing them to be assembled without a permanent chassis and loosening zoning restrictions on where they can be sited.
Those changes are designed to remove the stigma historically associated with low-priced mobile homes and expand affordable options for buyers on tight budgets.
The legislation also incentivizes lenders to offer small-dollar mortgages under $100,000, a segment of the market that has long been underserved by traditional financial institutions.
Civil penalties collected from institutional landlords under the new rules are earmarked to fund HUD assistance grants for first-time homebuyers, though the total revenue from those penalties remains unclear.
“This bill, combining House and Senate priorities, would represent the biggest housing bill in more than 30 years,” said Sen. Elizabeth Warren, the top Democrat on the Senate Banking, Housing, and Urban Affairs Committee.
Despite its scope, analysts cautioned that the measure “will take time to meaningfully affect housing affordability and will not resolve voter frustration in that area.”
