Harris Commits to Major Housing Investment, Trump Offers Federal Land Solution

This article was created by the non-profit news outlet Capital & Main and is shared here with permission.

While housing isn’t the most prominent topic in this year’s presidential debates, it remains a critical concern for many Americans.

A survey by real estate firm Redfin shows that over 80% of voters consider housing affordability a crucial factor in their voting decisions. The struggle is especially severe for low-income workers as no state, metropolitan area, or county in the U.S. offers affordable rents for minimum wage earners working full-time, based on data from the National Low Income Housing Coalition.

In the recent weeks, both political parties have presented their approaches to mitigate the housing issues in the U.S. Democratic candidate Vice President Kamala Harris and Republican candidate former President Donald Trump have offered differing visions and strategies, reflecting their distinct political stances.

Shortly after becoming the Democratic frontrunner, Harris introduced a plan that includes a $25,000 down-payment assistance for first-time homebuyers and a $40 billion fund to encourage local innovation in housing. This fund aims to provide financial resources to state and local governments, as well as private developers and builders, to develop creative solutions to increase housing availability.

Conversely, Trump has promised to allocate extensive federal lands for major housing projects. In a statement to The Economic Club of New York, he described these areas as having “ultra-low tax and ultra-low regulations,” positioning them as significant opportunities for small business growth and job creation.

Harris views the housing crisis primarily as an issue of supply, whereas Trump often attributes it to increased demand, frequently blaming immigrants for exacerbating the housing scarcity.

During a campaign event in Tucson, Arizona, Trump claimed that immigrants often occupy low-income housing and announced plans to require citizenship proof from tenants in subsidized housing and to prohibit immigrants living illegally in the U.S. from obtaining mortgages. This stance was challenged during the vice-presidential debate by Republican nominee Sen. JD Vance, who argued that immigrants drive up housing costs—a claim contradicted by experts who cited studies showing that stricter immigration laws actually shrink the construction workforce and lead to higher housing prices.

Evaluating Trump’s First Term and Project 2025

In his first administration, Trump proposed substantial cuts to federal housing aid and weakened measures aimed at fostering racial equity and addressing historical housing discrimination, according to Will Fischer, senior director of housing policy at the Center on Budget and Policy Priorities. In 2020, he attempted to reduce the budget for the Department of Housing and Urban Development by $9.6 billion, a proposal that Congress overturned, instead increasing the budget by 5.1%.

“Trump’s first term saw a de-emphasis on affordable housing compared to the Biden administration,” stated Robert Silverman, a professor at the University of Buffalo’s School of Architecture and Planning. “Rent increases outpaced inflation, and the pace of building affordable housing slowed down.”

Some initiatives in Project 2025, crafted by The Heritage Foundation for a potential second Trump term, reflect actions from his first term. Ben Carson, former secretary of the Department of Housing and Urban Development under Trump, authored these proposals, though the Trump campaign has distanced itself from this project.

Trump’s earlier budgets suggested abolishing the Housing Trust Fund, which aids states in maintaining and developing affordable housing. However, Congress maintained the fund, which was also supported by the Biden administration. Project 2025 aims to revisit ending this program.

Trump also terminated the Affirmatively Furthering Fair Housing rule, which Biden reinstated upon taking office in 2021. Project 2025 suggests another cancellation of this rule.

In 2020, Trump’s HUD expanded work requirements for public housing benefits, a policy Biden did not extend, citing the need to consider the current economic realities of low-income families. Project 2025 includes proposals to strengthen these work requirements and impose time limits on housing assistance eligibility.

“Trump’s policies, if continued, could likely exacerbate the housing crisis and increase homelessness,” remarked Sarah Saadian, vice president of public policy at the National Low Income Housing Coalition.

A spokesperson for the Trump campaign was unavailable for comment.

Harris’ Tenure as California Attorney General and Senator

According to Saadian, Harris has proposed promising housing policies, including limiting rent hikes by corporate landlords and addressing algorithm-driven price manipulations that disadvantage tenants. However, Saadian noted that Harris’ proposals primarily benefit middle and high-income renters, urging more inclusive solutions such as universal rent assistance or additional low-income housing developments.

“While some of Harris’ initiatives are beneficial, they often cater to higher income groups,” Saadian added, pointing out that many units developed under low-income housing tax incentives remain unaffordable for those most in need.

Some analysts believe that Harris’ proposal to assist first-time homebuyers may not be as effective as intended, potentially benefiting only a narrow group of buyers due to legislative compromises, primarily aiding sellers and banks through increased loan origination, explained Silverman.

As California’s attorney general and a U.S. senator, Harris consistently focused on housing issues. She was instrumental in passing the California Homeowner Bill of Rights in 2013, safeguarding homeowners against predatory foreclosure practices, and played a key role in negotiating an $18 billion settlement for victims of foreclosure fraud in 2012. However, her office faced criticism for not pursuing legal action against a major bank responsible for thousands of foreclosures.

The Harris campaign did not respond to inquiries for comment.

While both candidates recognize the gravity of the housing crisis, their approaches differ significantly, potentially impacting American housing policy for years to come, concluded Saadian.

Copyright 2024 Capital & Main