Congress Passed a Major Housing Bill. It Won’t Help You Buy a Home.

The bipartisan bill targets the country’s housing affordability crisis by capping institutional investors’ ownership of single-family homes and removing obstacles to home building. It eliminates an expensive requirement to build manufactured housing on permanent steel frames, streamlines environmental reviews, and incentivizes cities to provide preapproved home designs, which will simplify things for governments, regulators, and builders. Beyond that, it likely won’t change the homeownership equation for Americans.

Congress can’t unfreeze the market by lowering mortgage rates, which have been stuck above 6% since 2022, nor can it meaningfully shrink the six-million-unit housing shortage through the Act’s supply measures. Even if the president decides to sign it into law—a big “if” since he backed out of a signing ceremony on Wednesday—real progress on housing affordability will have to be made at the state level.

Housing reforms that increase supply, such as allowing smaller lots in new subdivisions, permitting duplexes, townhomes, and backyard cottages on existing lots, and changing zoning laws to allow housing nearer to jobs, are land-use issues. Land-use regulation isn’t the province of Congress. It is the responsibility of the states under the Tenth Amendment, itself a recognition that states have more knowledge and efficacy when dealing with local policy.

Fortunately, state legislatures are already passing bills to boost supply. According to our State Housing Supply Legislation Tracker, state-level laws are on track to produce roughly 280,000 new homes a year, which could halve the national housing shortage within a decade. The maximum opportunity for new builds from state-level reforms exceeds 1.5 million homes a year.

States have been able to experiment more effectively with policies than the federal government. In 2025, Texas passed bills legalizing housing on commercially zoned land and subdivisions of starter homes, which were rendered difficult or illegal to build by municipal zoning laws, large lot requirements, or other design requirements. In 2026, Idaho legalized starters-homes on small lots and Virginia allowed accessory dwelling units by right. Kansas did both at once.

Washington state’s housing reforms, enacted this year, will enable around 40,000 new homes to be built annually. For all the attention paid to the ROAD Act, it will likely fail to reach that number, and its bureaucratic process will take years to play out.

The modesty of the ROAD Act is good news, in some senses. The history of federal housing policy is largely one of failure, corruption, and even racism. Congress could have done far worse this time around, and nearly did. The House managed to undo most of the damage the Senate’s earlier version of the bill would have done through its misguided crusade against institutional investors. But, at the end of the day, most of the bill’s provisions won’t move the supply or affordability needle.

Anyone who wants to drive housing affordability, or understand where the housing market is headed, should pay attention not just to state legislatures. Zoom in even further to local governments, because states largely delegate land-use powers to them. And in local politics, a small, intense bloc of incumbent homeowners who are generally older, wealthier, and well-served by housing scarcity often dominate zoning hearings. The costs of their decisions fall onto the people who rarely show up to those hearings: renters, young families, and the workers being priced into the county next door.

Congress passed a major housing bill this week, promising sweeping change. The president might eventually make it law. But the cost of your future home is more likely determined by changes happening closer to home.

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