At midnight on July 11, the most significant housing legislation since 1990 took effect without the president’s signature. He called the “21st Century ROAD to Housing Act” “a big yawn,” and canceled the signing ceremony. At a time when Americans are deeply worried about the cost of housing and homeownership is slipping beyond the reach of many families, Trump let the biggest bipartisan housing achievement in a generation become law unsigned on his desk.
The bill was a remarkable and rare example of bipartisan legislating, passing both chambers of Congress by enormous margins. It’s a triumph for the build-more “abundance” movement, placing a federal-sized bet that deregulation will remove enough friction in the system to unlock the massive supply needed to address our affordable housing crisis. The bill’s central idea is that the best thing the federal government can do is get out of its own way—an understandable premise, given how distant Washington is from any actual construction site. And the bill really did enact meaningful reforms by streamlining environmental review, funding preapproved housing blueprints, finally removing the requirement that manufactured houses have to sit on a permanent chassis, and putting in place a first-of-its-kind limitation on how institutional investors can participate in the housing market.
But I question the central premise that the best the federal government can do is merely get out of the way. Conventional wisdom is that all housing policy is local, and that the federal government’s role in housing is minimal. But that calculation is wrong: the president holds the keys to dramatically accelerating and scaling up housing; that’s because, while land-use decisions are local, housing finance is national.
For example, the next round of federal action could draw from an approach that is already working across the country: build affordable housing for the long term through community-owned housing. The model is simple. You own your home and get a conventional mortgage from a regular lender. A nonprofit community land trust owns the land underneath it. Taking the land out of the deal lowers your price; in return, you agree to cap your equity gains, keeping the home affordable for the next family.
This isn’t for everyone. It’s for families in high-cost markets getting crushed by rent but locked out of ownership by sky-high down payments—people whose real choice isn’t between capped equity and full equity, but between capped equity and renting forever. For them, a stable and affordable payment and equity that grows with every mortgage payment provide a way to get off the renter ride.
And it works. In Denver, the Urban Land Conservancy uses a revolving capital fund to compete with investors and build permanently affordable housing at market speed. At Vermont’s Champlain Housing Trust, the nation’s largest community land trust, homeowners were dramatically less likely to fall behind or face foreclosure through the worst of the 2008 crisis than conventional borrowers—despite earning less. Resident-owned communities in Montana and New Hampshire are helping neighbors buy the land under their manufactured homes. This is not a fringe coastal experiment. It is communities banding together to thrive—but it has one problem: scale. America’s mortgage machine treats every community ownership loan as an exception, manually reviewed and slow to close, while conventional loans glide through automated systems into the world’s deepest capital markets.
A president—this one or the next—can solve that problem without waiting for Congress. The Federal government can tell Fannie Mae and Freddie Mac to standardize underwriting for community ownership loans, as they did for conventional mortgages. Their regulator can exempt permanently affordable housing from administrative limits on multifamily lending. The Federal Home Loan Banks can prioritize lasting affordability in existing programs. Federal credit enhancement can make deals that couldn’t pencil out yesterday, pencil out today. Where Congress has just streamlined the permits, the president can streamline the money. The new law tells us who shouldn’t own America’s homes: private equity. Community ownership answers who should: the people who live in them, or those who still dream that they could.
The ladder from renting to homeownership was built by policy. Congress just proved that housing policy can still be done. Now someone has to finish the job—not just for the families struggling today, but for every family that follows.
