Democratic nominee Kamala Harris, in her presidential bid, is promising to build more housing in America. This comes at a time when rising costs of households have stressed Americans and home ownership is beyond reach.
Harris has laid out detailed plans to spur new construction and reduce costs for renters and homebuyers, largely through tax incentives.
“We will end America’s housing shortage,” she said as she accepted the Democratic presidential nomination last week.
Donald Trump, the Republican presidential candidate, has also promised to reduce costs through tax breaks and reduced regulations. However, he has also defended the local housing restrictions that prevent affordable housing from being built.
Fears of rising prices and stagnating income is the most important economic worry faced by voters. Housing costs are rated as the second most important one as per voters.
Housing Shortage
The housing construction market collapsed during the 2007-2009 financial crisis in America. It has been slow to recover in the years since, leaving the USA 2.9 million units short.
The COVID19 pandemic crisis pushed up the prices of new housing and interest rates. This made mortgages more expensive. In the last five years, U.S home prices have shot up by 50%. Rents have also risen by 35%, as per a real estate firm Zillow.
Alyssa Cass, a Democratic strategist, has said housing is a top concern in focus groups. She said Harris’ housing plan could help her win over voters.
At an Aug. 16 campaign stop in North Carolina, Harris called for building 3 million more housing units in four years. This is on top of the 1 million or so built annually by the private sector, through a new tax credit for developers who build homes aimed at first-time homebuyers and a $25,000 tax credit for those buyers.
She has also proposed a $40 billion fund to encourage local governments to build more affordable housing and expand rental aid among other things. Experts estimate that these policies could cost at least $200 billion over 10 years.
While these promises may help Harris get a vote, if elected President, she may face issues enacting these policies into law. Similar proposals from President Joe Biden have failed to clear Congress. However, Harris has been involved in a broader Biden administration effort to encourage development.
In June, she announced $85 million in grants to 21 local governments to remove “barriers to affordable housing.” The Biden administration plans to distribute another $100 million later this year.
Trump’s Stance On Housing
Trump’s position is less clear. The Republican Party’s platform calls for boosting home ownership through tax breaks and eliminating regulations. However, specifics are not outlined.
Trump also has spoken against proposals to loosen local zoning restrictions that prevent apartments and other forms of affordable housing from being built in neighbourhoods reserved for single family houses.
Trump’s running mate, U.S. Senator JD Vance, has blamed immigrants for the housing shortage.
During Trump’s 2017-2021 presidency, his housing secretary Ben Carson proposed easing zoning rules but did not take action. More recently, he called for opposing any efforts to weaken single-family zoning in Project 2025, a conservative policy plan that has been disavowed by the Trump campaign.
