Landmark housing bill becomes law without Trump’s signature
After months of debate, the 21st Century ROAD to Housing Act has finally become law. Plus, FHA requirements raise concerns; Fed appoints task force leaders.
Key points:
- The bipartisan housing bill Congress passed last month has become law despite the president’s refusal to sign it.
- The Consumer Federation of America highlighted “widespread misunderstandings” about the FHA’s minimum property requirements in a recent letter to HUD.
- Fed Chair Kevin Warsh has announced the leaders of five task forces he introduced last month intended “to ensure the Fed is best positioned to achieve our objectives.”
This story has been updated to reflect the enactment of the ROAD to Housing Act.
The 21st Century ROAD to Housing Act has officially become law. Since the president neither signed nor vetoed the legislation, it automatically advanced without his signature at midnight on July 11. The bill has been described by real estate industry advocates as the federal government's biggest move on housing in decades.
"For Realtors, this law is more than a legislative victory. It shows what sustained advocacy and bipartisan leadership can accomplish to expand housing opportunities and strengthen communities nationwide," NAR Chief Advocacy Officer and EVP Shannon McGahn said in a statement following the early-morning enactment.
Elsewhere in Washington, D.C., a consumer advocacy group is calling on the Federal Housing Administration (FHA) to make some of its requirements for borrowers easier to understand, and the Federal Reserve has announced who will be spearheading its five new task forces.
'Most significant step on housing' enacted
After months of political wrangling in Congress, the 21st Century ROAD to Housing Act became law at 12 a.m. Saturday.
The popular bipartisan housing package passed by large margins in the House and Senate last month. But after President Donald Trump unexpectedly canceled a scheduled signing ceremony, many politicians and industry advocates grew concerned that it might not become law after all.
When the House speaker officially sent the legislation to the White House, a 10-day clock began ticking down for the president's decision. On Friday morning, Trump said in a social media post that he "will not sign" the bill "in PROTEST" of the lack of momentum on an unrelated, controversial voter ID bill he wants passed.
Trump did not veto the housing bill, however, and it automatically became law at the stroke of midnight.
Several of the bill's supporters — including the National Association of Realtors and the National Association of Home Builders — had reiterated their backing in statements earlier this week and praised the long-awaited enactment.
"Today's achievement is the result of years of persistence, trust, and collaboration" and a reflection of "a shared commitment to addressing one of America's most pressing challenges," NAR's McGahn said.
Brokerage leaders signaled their support as well. With the bill's enactment, the U.S. "just took its most significant step on housing in a generation," Century 21 CEO Mike Miedler said in a statement. The new law is "not a finish line," Miedler added, but "a foundation."
"The American dream of homeownership just got more reachable," Miedler said. "Our job is to make sure people can actually reach it."
REMAX President and Chief Growth Officer Chris Lim echoed that sentiment: "This legislation recognizes that increasing housing supply is a critical part of the solution," Lim said. "
While there is still work ahead, giving communities more tools to encourage development is a meaningful first step toward a more balanced market that will help buyers compete and support long-term homeownership growth."
CFA flags 'widespread misunderstandings' about FHA requirements
The Consumer Federation of America (CFA) is raising concerns about the FHA's minimum property requirements (MPRs), which the agency characterizes as being widely misunderstood by consumers.
Used to ensure that the homes purchased with help from FHA-insured loans meet certain safety standards, the MPRs are "important" and "should continue," the CFA told HUD in a July 2 letter following the department's request for information.
But "widespread misunderstandings" about these requirements "have created unnecessary barriers for FHA borrowers," the CFA wrote, adding that there exists a perception among real estate agents and consumers "that FHA-financed transactions are unusually burdensome, likely require extensive repairs, and are prone to delayed or even failed closings compared to conventional financing."
To address these "pervasive myths and misunderstandings," the CFA urged the FHA to "prioritize consumer and industry education and improve communications on the exact nature of the MPRs and impacts on closing timelines and transactions," in part by making a checklist available in plain language on its website.
The CFA's recommendations "would directly address longstanding misconceptions surrounding FHA mortgages and the MPRs," the letter concluded.
Fed appoints task force leaders
On July 9, Kevin Warsh announced the teams that will lead the five task forces he created upon rejoining the Fed as its new chair.
Communications: Peter R. Fisher, professor of practice at the University of Washington's Foster School of Business; Arminio Fraga, founder and chairman of Gávea Investimentos and former president of the Central Bank of Brazil; and Mervyn King, former Bank of England governor
Balance Sheet Policy: Karen Dynan, professor of economics at Harvard University; Raghuram Rajan, professor of finance at the University of Chicago Booth School of Business and a former Reserve Bank of India governor; and Jeremy Stein, professor of economics at Harvard University and a former Fed governor
Data: Raj Chetty, professor of economics at Harvard University; Doug McMillon, former president and CEO of Walmart Inc.; and Kevin Murphy, professor of economics at the University of Chicago
Productivity and Jobs: Marc Andreessen, cofounder and general partner at Andreessen Horowitz; Charles I. Jones, professor of economics at Stanford University and currently on leave at Anthropic; and Asha Sharma, EVP and XBOX CEO at Microsoft Corp.
Inflation Frameworks: Greg Mankiw, professor of economics at Harvard University and a former Council of Economic Advisers chair; Thomas Sargent, professor of economics at New York University and a Nobel laureate; and William White, senior fellow at the C.D. Howe Institute and a former Bank for International Settlements economic adviser
Each task force "will carefully consider whether policymakers' means and methods, analytical tools and policy approaches can be improved upon," Warsh said in a statement. "The goal is straightforward: to ensure the Fed is best positioned to achieve our objectives in this consequential time."