Days after passing the massive $1 trillion infrastructure bill, the Senate has turned its sights to a $3.5 trillion measure that focuses extensively on housing and zoning policy investments. If you’re considering selling your home, these two bills could impact the market, your property, and your profit potential.
Understanding the Infrastructure Bill
The infrastructure bill assigns some $550 billion to bridges, roads, high-speed internet, and other improvement projects across the country. Many more billions are going toward public transit, but that’s not the biggest concern to today’s homeowners and sellers.
Preserving and Expanding Affordable Housing
If you’re considering selling your home in the next year or two, the $3.5 trillion plan will impact you. Approval of the plan will allow up to $332 billion for investments in housing and related projects.
This plan could fund the $213 billion plan to build and preserve more than two million affordable housing units nationally.
Incentivizing Cities and States
The infrastructure plan proposes an expansion of Section 8 vouchers and incentives to cities and states to eliminate “exclusionary” zoning. These are part of the effort to aid the housing crisis, but neither are part of the infrastructure bill—yet.
The Associated General Contractors of America is one of many organizations urging the house to pass these resolutions. They’re also one of many that will benefit from the approval.
Changing Policies and Opening Doors
The New York Housing Conference also spoke on the matter and advocate a change to the “50% test”. This test requires a development to receive at least half of its funds from private activity bonds in order to receive Low Income Housing Tax Credits.
The federal government “gaps” those private activity bonds by covering the amount between the construction costs and the funding available. While that sounds great, New York does not have unlimited funding to issue so many bonds, limiting affordable housing construction. The New York Housing Conference estimates that a reduction to a “25% test” would allow up to 10,000 more affordable housing units to be constructed each year throughout the state.
The Impact To Homeowners
This massive infrastructure bill impacts homeowners across American in dozens of ways, both directly and indirectly.
The Impact Won’t Be Instant
Home sellers with their property already on the market shouldn’t expect to see a change in the short term. Homeowners planning to sell in the next three years will feel the impact as the surrounding community expands and improves.
Without a doubt, most communities will see an increase in affordable housing units over the next few years. This will include apartment complexes and small developments. The increase in supply will impact housing values.
Without a crystal ball, any expert would be hard-pressed to pull a number out of their hat. Overall demand will be impacted by supply, interest rates, the national economy, and local job availability.
Focus on Community Outlook
If you’re a homeowner a buyer wondering how this bill could affect the housing market, don’t sweat it. In truth, the infrastructure bill is unlikely to have a direct nor immediate impact on any single homeowner.
This package targets developers, investors, and municipalities. Homeowners won’t see impacts until these parties go through the process of advocating for policy changes, enacting new zoning laws, and receiving funds.
You can get ahead of the curve by considering the overall community outlook. Stay abreast of the projects your city, county, and state are pursuing.