Republican bill could help ease US housing shortage, JEC analysis finds
EXCLUSIVE: A proposal by Republican Sen. Mike Lee that aims to ease the nation’s deepening housing crisis by putting unused federal land in local hands could make major inroads into building more affordable homes, according to a new analysis released. Thursday by the Republicans of the Joint Economic Committee.
The results, first shared with FOX Business, show the Utah Republican’s proposal would lead to the construction of 2.7 million new homes in the United States, reducing the housing shortage in the United States by about 14%. country.
Lee’s proposal would be particularly effective in the West, where the federal government owns about half of the land: it would fill all – or almost all – of the housing shortage in Arizona (100%), Nevada (100 %), in Wyoming (100%), Idaho (95%), Alaska (85%) and New Mexico (85%) and would make a substantial dent in places like Montana (73%), Oregon (69%), Utah (35%) and California (27%).
“The key issue here is that there is a major housing affordability problem in the United States today, and it has only gotten worse since the start of the COVID-19 pandemic,” Kevin said. Corinth, staff director of the Joint Economic Committee, to FOX Business. “Home prices are up 30% year over year. As a result, housing is more out of reach than ever for Americans, and we need solutions to address it.”
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The Helping to Open Underutilized Spaces for Shelter Act — or HOUSES — allows state or local governments to purchase parcels of federal land at a discount to increase supply housing in their regions. The measure would require any jurisdiction that purchased land to use it for housing, subject to a density requirement, and protect against the development of expensive second homes on purchased plots, according to a press release from Lee’s office. .
In order to build 2.7 million new homes, the federal government would have to transfer about 0.1% of the land, or about 681,000 acres, to local governments. Revenues generated from the sales would be funneled back into various types of land management projects, including forest fire prevention activities, habitat conservation activities and water infrastructure, in the condition they were sold.
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“This policy could make substantial progress in increasing housing supply and thus make housing more affordable in Western states – with no federal spending, no interference in local decision-making, and very little loss. in federal land holdings,” the analysis reads.
Mortgage giant Freddie Mac has estimated that there is a shortfall of around 3.8 million housing units in the country, while the Joint Economic Committee has forecast that it is actually as high as 20 million homes.
The housing market boomed at the onset of the COVID-19 pandemic, buoyed by historically low interest rates at the same time that American buyers – full of cash and hungry for more space – began to flock to the suburbs. Home prices rose 19.7% in May from a year ago, according to the most recent data from the S&P CoreLogic Case-Shiller National Home Price Index. By comparison, pre-pandemic levels hovered around 4%.
High house prices are mainly due to “restrictive land use regulations that prevent workers from moving to more productive labor markets, restrict economic growth, slow family formation and increase insecurity. housing,” the JEC said.
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However, Lee’s bill could help make housing more affordable by expanding supply: the report estimates that an additional 4.7 million Americans could afford to buy the average home in their state if the HOUSES Act Act became law.
“Restrictions on housing supply are negatively impacting the economy and the well-being of American families by driving up US home prices,” the report said. “Rising house prices are imposing obstacles to family formation, excluding workers from the labor market, stunting economic growth and exacerbating problems related to housing insecurity.”