What is Congress doing about the Shortage of Housing?
March 11, 2026
Author: Roger Ashworth, Head of Research and Data
Congress has started moving a meaningful housing bill. The House has already passed H.R.6644, and the Senate is now considering a broader package called the 21st Century ROAD to Housing Act, released by Senate Banking Committee Chairman Tim Scott and Ranking Member Elizabeth Warren. The Senate package combines most of the earlier Scott-Warren ROAD to Housing Act, most of the House’s housing provisions, and a separate title aimed at limiting future purchases of single-family homes by very large institutional investors. As of March 8, 2026, the legislation has cleared meaningful procedural hurdles in the Senate, but it is not yet law.
The Bill is Mostly about Supply
At a high level, this is primarily a housing-supply, preservation, and housing-finance bill. The package would expand the use of Community Development Block Grant funding for housing, streamline federal environmental review for smaller and infill projects, raise the bank public-welfare investment cap from 15% to 20%, support manufactured and modular housing, revisit small-dollar mortgage rules, raise Federal Housing Administration multifamily loan limits, expand Rental Assistance Demonstration, and authorize Preservation and Reinvestment Initiative for Community Enhancement grants for manufactured housing communities. In practical terms, Congress is trying to make it easier to build, finance, rehabilitate, and preserve housing rather than relying on a single affordability fix.
That matters because the housing problem is not just about headline home prices. It is also about monthly payment burden and the availability of usable housing stock. John Burns Research & Consulting’s (“JBREC”) affordability analysis(1) found that, as of late 2024, buying a starter home still costs materially more per month than renting a similar home. That helps explain why even a meaningful federal housing package is unlikely to produce an immediate improvement in affordability, home prices, rents, or origination volumes. Many of the provisions work through pilots, authorizations, regulatory changes, or program reforms, which means the economic effects would likely build gradually. For markets, the key point is that the bill targets structural frictions in housing supply and financing rather than delivering a rapid demand impulse.
Title IX is Narrow in Scope but Relevant for Market Structure
The most visible provision for real estate investors is Title IX, “Homes Are for People, Not Corporations.” This section would apply to for-profit entities that directly or indirectly control at least 350 single-family homes. For the purpose of Title IX, a “single-family home” means a structure with one or two dwelling units, and manufactured homes are excluded. If enacted, the restriction would take effect 180 days after enactment and sunset 15 years after that effective date. The bill would apply to future purchases only and would not require large investors to sell homes they already owned before enactment.
That investor section is narrower than some headlines imply, but it is not insignificant. The draft includes exceptions for some build-to-rent projects, substantial rehabs, certain homeownership-pathway structures, some lender and servicer acquisitions after default, investor-to-investor transfers, and some age-restricted communities. The main economic pressure point is that several of those exceptions still carry a seven-year resale requirement, meaning the property ultimately must be sold to an individual homebuyer. The bill also includes renter protections such as renewal rights for up to an aggregate 36 months, a right of first refusal, and a 30-day first-look period.
Market Implications for Residential Credit
For home equity loans and home improvement loans, the read-through looks mostly indirect. The bill does not create a new federal channel for private second-lien lending, and it does not create a direct new federal channel for private home equity lending. But the Whole-Home Repairs Act, manufactured-housing preservation provisions, and policies designed to support smaller-balance mortgage access and household savings all point in the same direction: policymakers are trying to preserve existing housing stock and reduce friction for households that are close to homeownership or home-repair decisions. That is directionally supportive for repair-oriented credit, even if the near-term effect is likely limited.
Residential transition loans look more exposed. Where a project’s exit depends on a sale toa large single-family rental platform or a scaled build-to-rent buyer, Title IX could reduce exit liquidity or require more conservative underwriting assumptions. Traditional fix-and-flip strategies that exit to owner-occupants are less directly affected. By contrast, rental-oriented bridge strategies, builder takeout structures, and platform aggregation models appear more exposed at the margin if the final bill retains the current approach to institutional purchases and resale requirements. That conclusion is an inference from the draft text, not an explicit statement of legislative intent, but it is the clearest transmission channel into residential transition credit.
For non-QM debt-service coverage ratio mortgages on rental properties, the direct effect appears more limited. The bill does not target apartment properties, does not apply below the 350-home threshold, and does not force liquidation of existing portfolios. Most small and mid-sized rental investors are therefore outside the direct scope of the proposal. At the margin, that could modestly improve the competitive position of smaller buyers in selected local markets if very large acquirers become less active. Any benefit, however, would likely be geographically concentrated rather than national in scale.
The National Footprint looks Limitied, but the Local Effects may not be
JBREC’s sizing is useful here. Its analysis(1) suggests that investors at the bill’s 350-home threshold represent about 0.7%of the nation’s 92 million single-family homes, about 5% of roughly 14 million rental homes, and about 1% of the 4.7 million homes purchased in 2025. That implies the national footprint of the targeted buyer group is still relatively small. The bigger market question is not whether Congress has found a complete affordability solution through Title IX, but whether the bill’s treatment of build-to-rent and other rental strategies changes capital formation in meaningful ways in specific local markets.
Bottom Line
Congress appears to be pursuing a two-track response to the housing shortage: (1) make it easier to build, preserve, and finance housing, and (2) place limits on one specific slice of institutional demand in single-family homes. For investors in alternative residential credit, the broader supply and preservation sections are likely more important for long-run origination volumes and market functioning. Final impact will depend not just on whether the bill passes, but on what survives into final text and how Treasury, HUD, and other agencies implement the law in rulemaking.
Footnotes:
(1) John Burns Research & Consulting, “The housing bill that will make affordability worse, not better.” Published March 6, 2026.
(2) United States Senate Committee on Banking, Housing,& Urban Affairs, "The 21st Century Road to Housing Act.”
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