Government LendingHousing Market

Biden outlines housing proposals during State of the Union

Include a housing tax credit and a federal boost for building affordable homes

President Joe Biden entered the chamber of the U.S. House of Representatives on Thursday night, filing past a narrowly divided Congress during an election year and preparing to give a State of the Union address that would feature a relatively substantive focus on housing.

“If I were smart, I’d go home now,” he started.

After focusing on some of the more hot-button political topics of the day, Biden moved into more typical points for a national political speech: the economy, pharmaceutical prices and health care availability. From there, he switched topics.

“I know the cost of housing is so important to you,” he began. “As inflation keeps coming down, mortgage rates will keep coming down as well. But I’m not waiting.”

Then, as telegraphed earlier in the day, Biden turned his attention to new proposals on housing and mortgages.

“I want to provide an annual tax credit that will give Americans $400 a month for the next two years as mortgage rates come down, to put toward their mortgages when they buy their first home, or trade up for a little more space.”

As applause broke out on one side of the aisle, he reiterated: “Just for two years.”

Then he spoke about a more controversial element to the housing plan announced earlier on Thursday: cutting the requirement for title insurance on some loans.

“And my administration is also eliminating title insurance on federally-backed mortgages,” he said. “When you refinance your home, you can save $1,000 more as a consequence.”

Amid the noisy reaction from the audience, it was easy to miss the important caveat in that proposal — it only applies to refinances.

He also addressed pain points for renters.

“For millions of renters, we’re cracking down on big landlords […] who break antitrust laws by price fixing and driving up rents. We’ve cut red tape so builders can get federal financing, which is already helping build a record 1.7 million new housing units nationwide.”

As the vice president applauded heartily, the first indication of a reaction came from Republican Speaker of the House Mike Johnson: a slight nod.

“Now pass and build and renovate 2 million affordable homes, and bring those rents down.”

And with that, after brief applause, the president moved onto the topic of education.

Democrats stood and applauded in response to each housing initiative the president offered, while the Speaker of the House and most Republicans in the chamber generally remained seated and silent. This isn’t likely to mean anything beyond lawmakers simply falling in line with their political priorities, nor does it necessarily indicate which lawmakers could end up supporting or opposing any resulting legislation.

Time will tell how everything unfolds, but it appears that anecdotes shared by other lawmakers have some truth to them: housing is an issue that resonates with the electorate, lawmakers are taking notice, and the election itself is less than eight months away.

It’ll be here before we know it.

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