Supporters of affordable housing from around the country are pressing Senate tax writers to advance tax policy that they believe can play a major role in addressing the current housing shortage.
According to a new report from the National Association of Realtors, the share of sales going to first-time homebuyers fell last year to the lowest level on record. Higher interest rates, of course, also play a significant role in limiting the ability of average Americans to buy a home.
“There can be little doubt we are currently in an affordable housing crisis,” Denise Scott, president of the Local Initiatives Support Corporation (LISC) told lawmakers during a March 7 Senate Finance Committee hearing on ‘Tax Policy’s Role in Increasing Affordable Housing Supply for Working Families.’ “Rents have been rapidly climbing, supply has been tightening, costs of construction have been increasing, and we have underproduced roughly 3.8 million homes.”
According to the National Association of Home Builders, since Spring 2020, prices have gone up for frame lumber by 25 percent, copper by 187 percent, aluminum by 72 percent, steel mill products by 79 percent, plastic construction products by 55 percent, brick by 25 percent, interior paint by 47 percent, and exterior paint by 62 percent. Based on the increased costs of building, many will be unable to own, and will thus be renters for the foreseeable future.