Biden Administration Announces $100M Housing Initiative

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Facts

• US Treasury Secretary Janet Yellen on Monday announced the Biden administration’s new effort to increase the supply of affordable housing as persistently high inflation and interest rates contribute to record, and ever-increasing, shelter costs.¹
• At a speech in Minneapolis, Yellen unveiled a $100M commitment over the next three years to a new Treasury Dept. program through the Community Development Financial Institutions Fund that is primarily focused on increasing the supply of affordable housing.²
• This comes amid a two-day visit in Minnesota, where Yellen will meet with Sen. Tina Smith (D-Minn.) and other housing stakeholders. Yellen is also calling on the 11 government-sponsored Federal Home Loan Banks to increase their support for housing initiatives.²
• Yellen's speech also included an effort to increase interest predictability for state and local housing finance agencies borrowing from the Federal Financing Bank and a new 'How-To Guide' to assist local governments in using Treasury Dept. recovery funds to construct housing.²
• Home prices have increased 46% between March 2020 and March 2024, according to the Case-Shiller 20-City Composite Home Price Index, and the Federal Reserve’s high interest rate (5.3%) has caused rising mortgage rates, compounding the record prices.³
• The announcement comes just days before the first Presidential debate of the 2024 election cycle, as Pres. Biden looks to defend his record on housing and inflation despite high shelter expenses.⁴

Sources: ¹Axios, ²U.S. Department of the Treasury, ³Associated Press and ⁴CNBC.

Narratives

• Democratic narrative, as provided by Housingfinance. Despite persistent challenges that remain from the pandemic, the Biden administration is working to increase the supply of affordable housing and lower shelter prices across America. By investing in local communities and creating various programs that integrate different agencies, Pres. Biden's plan will promote the construction of new housing units at an affordable price. Tackling high housing prices is a large undertaking that will take time, but the Biden administration has put forth key policies that will fix the problem.
• Republican narrative, as provided by Chronicles. Joe Biden's misguided policies have caused America's housing crisis, and his initiatives will only exacerbate the problem. Sky-high inflation and interest rates have certainly contributed to high housing prices, and Biden's permissive immigration policies have been the final nail in the coffin. Until the immigration issue is comprehensively addressed, it will be increasingly challenging for younger Americans to achieve sustainable home ownership.

Predictions