Sen. Elizabeth Warren has introduced housing legislation that she says will eliminate the housing supply shortage and create more than a million new jobs. The proposed law would be funded through higher taxes on wealthy families.
On Wednesday, the Democrat from Massachusetts — who sits on the Banking, Housing, and Urban Affairs Committee — announced that she introduced the American Housing and Economic Mobility Act in the Senate.
According to Warren, who was the architect of the Consumer Financial Protection Bureau, the proposed law would
“help bring down costs for renters and buyers and level the playing field so working families everywhere can find a decent place to live at a decent price.”
The bill proposes $10 billion for community infrastructure grants and $2 billion for borrowers who are still in a negative-equity position.
Warren cited an analysis of the bill by Moody’s Analytics Chief Economist Mark Zandi that determined the legislation would enable the construction or rehabilitation of 3.2 million units over the next decade. Such an increase in supply would completely close the current gap between housing demand and supply.
In addition, Warren said the study determined that 1.5 million new jobs would be created
at the peak impact of the proposed law.
Furthermore, Warren claims the bill would, bring down rents for lower-income and middle-class families by 10 percent without any long-term deficit impact. That works out to an average savings of $100 per month.
“This simulation [of the effect of the American Housing and Economic Mobility Act] likely understates the economic benefit of the legislation, because it does not consider that the measure will facilitate the ability of low- and middle-income households to move closer to their employment or potential jobs,” Zandi was quoted as saying.
Warren said the cost of the proposed law will be paid for by the
roughly 10,000 wealthiest families in the country through higher estate tax rates.
“This proposal will attack the rising cost of housing by helping to roll back needlessly restrictive local zoning rules and taking down other barriers that keep American families from living in neighborhoods with good jobs and good schools,” she said in today’s statement. “After bungling housing policy for decades, it’s time for Congress to make things right and pass my bill.”
