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Senate Passes 21st Century ROAD Act to Curb Investors, Boost Housing Supply

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The U.S. Senate overwhelmingly passed the 21st Century ROAD to Housing Act on Thursday, approving what backers called the largest federal housing package in a generation by a vote of 89–10.bipartisanpolicy +1 The bipartisan bill, authored by Senate Banking Committee Chair Tim Scott and ranking Democrat Elizabeth Warren, aimed to boost housing supply, curb large investors’ role in single‑family home purchases, and nudge local governments to loosen development rules.npr +1

If enacted, the roughly 300‑page legislation would bar big institutional landlords from expanding their single‑family portfolios, create new incentives for cities to approve construction, and relax federal standards on manufactured housing. The measure must now clear a divided House, where Republicans are already demanding changes and former President Donald Trump has tied his support for most legislation to passage of his separate SAVE America voting bill.politico +1

How the Bill Targets Investors and Tries to Unlock Supply

A centerpiece of the act would prohibit institutional investors that own at least 350 single‑family homes from buying additional units, reflecting growing political anger over Wall Street’s role in tight housing markets.npr +1 Backers argued the cap would stop large firms from outbidding families for starter homes while still allowing small landlords and builders to operate.npr Warren said the bill would “beat private equity out of the system,” contending that “homes are for the families who live there, not for Wall Street investors.”nbcnews

The bill couples that cap with a controversial “build‑to‑rent” rule requiring institutional owners that construct or rehabilitate new single‑family rentals to sell those homes after seven years, with limited extensions to let tenants buy their units.npr +1 Industry groups warned the forced‑sale clock could make projects impossible to finance and “effectively eliminate” some rental development models, while Sen. Brian Schatz, one of 10 senators to vote no, called the provision “positively Soviet” and unworkable for legitimate developers.nbcnews +1 Supporters countered that the rule would ensure new construction ultimately adds to the pool of homes for sale, not just permanent rental portfolios.npr

Zoning Incentives, Manufactured Homes and the Political Road Ahead

Beyond the investor fight, the bill leans heavily on nudging local governments to allow more housing. It would create a $200 million‑a‑year “Innovation Fund” offering competitive grants to cities, counties and tribes that relax zoning, cut permitting delays or adopt pre‑approved “pattern book” designs aimed at speeding construction.bipartisanpolicy It would also scrap a long‑standing federal requirement that manufactured homes be built on a permanent chassis, a technical shift supporters said could lower costs and expand modular housing production.bipartisanpolicy +1 Banks would be allowed to devote up to 20% of their capital — up from 15% — to public welfare investments such as affordable housing, in a bid to unlock more private financing.bipartisanpolicy +1

The bill also tucks in a temporary prohibition on the Federal Reserve launching a central bank digital currency through 2030, a priority for some Republicans wary of federal control over payments.bipartisanpolicy That provision, along with the investor limits, has already drawn fire from House conservatives who want a permanent digital currency ban and looser rules on institutional buyers.politico While national real estate and housing nonprofits broadly praised the Senate vote, major landlord and home‑builder lobbies warned of a “chilling effect” on new rental supply, setting up an intense lobbying battle as the bill heads to the House.politico +1

The Bigger Picture

The Senate action underscored how rising housing costs — after years of underbuilding and surging post‑pandemic prices — have become a rare point of bipartisan urgency.nytimes +1 Yet the sweeping package now collides with internal Republican disputes, industry resistance and an unpredictable White House strategy, leaving its future uncertain even after a lopsided Senate win. Whether the final bill meaningfully dents a national housing shortfall estimated in the millions of units will hinge not only on investor rules and federal grants, but on how far local governments and private builders go in actually turning its incentives into new homes.