A landmark piece of housing legislation has been thrust onto the statute books in the United States, despite President Donald Trump's high-profile refusal to sign it into law. The '21st Century Road to Housing Act' was enacted automatically after Trump allowed a deadline to pass without issuing a veto, following his repeated assertions that he would not sign it due to his ongoing concerns over voter ID legislation.
The President has been vocal in his call for the Safeguard American Voter Eligibility (SAVE) Act to be prioritised – a bill that would require Americans to provide identification and proof of citizenship to vote. Trump's stance was reiterated on social media as recently as Friday, where he expressed frustration at the Senate's failure to pass the SAVE Act. Republican leaders have indicated there is insufficient support within their ranks to pass the voter ID measure, which Democrats argue could disenfranchise eligible voters.
Experts hail the new housing law as the most comprehensive action taken by Congress in the 21st century to address the rising costs of housing for renters and homebuyers. The legislation received rare bipartisan approval in both chambers of Congress in June, reflecting widespread concern over housing affordability across the US. A survey by the Bipartisan Policy Center earlier this year found that 89% of voters across the political spectrum desired congressional action on housing costs.
The '21st Century Road to Housing Act' contains over 40 provisions designed to reduce housing costs and boost the supply of homes, a critical issue given years of housing shortages in the US. Key measures include making it easier to construct new homes and placing limits on the number of single-family homes institutional investors can acquire nationwide. These changes come at a time when the median price of existing homes in the US hit an all-time high of approximately £328,000 in June, an increase of 1.8% from the previous year, according to the National Association of Realtors.
The rising cost of property, coupled with high inflation and elevated interest rates, has made homeownership increasingly unattainable for many American households. Redfin, a real estate brokerage, estimates that a US family now needs an annual income of around £92,000 to afford an average home, a figure nearly £24,000 higher than what most US households currently earn, according to Census data. This affordability crisis underscores the urgency behind the new legislation, which aims to bring down barriers to homeownership and increase the overall housing stock.
In the UK, the housing market also faces significant challenges, albeit with different drivers. Recent data from Rightmove indicated that average asking prices for homes across Britain saw a marginal increase of 0.8% in June, reaching a new record of £375,131. However, annual growth has slowed considerably, standing at just 0.6%. This contrasts with the double-digit growth seen in some other countries where housing markets are booming, and serves as a reminder that the US is not alone in grappling with this pressing issue.
The UK's own homeownership rates have been declining for years, with many Britons struggling to afford even modest homes. The new legislation may offer some valuable lessons for policymakers here, particularly regarding the need to boost housing supply and tackle affordability barriers. As both countries face the challenges of a rapidly changing global economy, it will be interesting to see how their approaches to housing policy evolve in response.
The UK's own relationship with US housing markets is also an important consideration, given the significant trade links between the two nations. As the US continues to grapple with its housing crisis, British homeowners and renters would do well to keep a close eye on developments across the Atlantic – particularly as it relates to issues like foreign investment in property and the impact of exchange rates on affordability.