President Donald Trump has signed an executive order to ease or, in some cases, eliminate rules that have been blamed for blocking greater construction of affordable housing. Homebuilding is near its lowest level in 60 years, contributing to a nationwide housing shortage that has pushed home prices up and battered affordability.
Trump announced that a newly created initiative called the White House Council on Eliminating Barriers to Affordable Housing Development will use federal programs to find ways to encourage local governments to allow for more building. The council, which will be chaired by Department of Housing and Urban Development Secretary Ben Carson, will also conduct a study to quantify the effect of regulations on the housing market and economy.
The White House’s move was largely welcomed by the real estate industry, which has long called for more access to affordable housing. For nearly four decades, household incomes have increased at a slower rate than home prices—a problem that was only made worse by the Great Recession, says National Association of REALTORS® President John Smaby. “Today, despite historic economic growth and recovery, misguided regulations and gaps in new-home construction have stopped far too many Americans from purchasing a home,” Smaby says. “We look forward to continuing to work closely with the White House to ensure the American dream remains attainable for all those who seek to become homeowners.”
That sentiment was echoed by the National Association of Home Builders, which has long blamed zoning restrictions on curtailing a full recovery in home construction since the recession. The NAHB called the need to tackle housing affordability “urgent” and applauded the formation of a new council that would “seek to reduce regulatory barriers that are making housing more costly.” NAHB studies have found that regulations account for nearly 25% of the price of building a single-family home and more than 30% of the cost of typical multifamily development.
Source: “Trump Administration to Take on Local Housing Barriers,” The Wall Street Journal (June 25, 2019) [Log-in required.]
