President Joe Biden’s Build Back Better Bill Aims to Help American Housing

30 Nov

The recently passed Build Back Better bill is President Joe Biden’s $1.75 trillion social spending bill that aims to lessen housing burdens for Americans. It includes a variety of programs designed to help with everything from building more public housing to down payment assistance for first generation homebuyers. 

According to the National Fair Housing Alliance, the bill’s passage could be a game changer for affordable housing. “We applaud the House of Representatives today for passing the Build Back Better Act, the largest investment in basic housing and fair housing enforcement infrastructure needs in U.S. history,” they said in a recent statement.

Here is a quick look at the various programs included that may benefit homeowners and homebuyers:

Housing Voucher Program

Build Back Better will add $24 billion for rental assistance over the next five years. This is in addition to the $29 billion that was approved for 2022. Currently, over 5 million people rely on vouchers to afford their housing. This includes working families, seniors as well as veterans and disabled people. These vouchers can be used for any private housing if the landlord accepts the vouchers. 

The Voucher program can certainly benefit from the additional funding. Currently, only 1 in 4 people who are eligible for the vouchers can receive them due to underfunding. In most cases, even those who are eligible have to wait an average of 2.5 years to get the vouchers. 

Improve public housing

Public housing has been underfunded for years which has led to a shortage of units that currently exceeds 200,000. This program will receive $1.6 billion to repair or renovate public housing units to make them safer for their tenants. 

The bill also adds $10 billion for the HOME Investment Partnerships Program. This government program builds and rehabs affordable homes for low-income families. The bill also includes $15 billion to expand affordable rental housing for low-income families. 

The Housing Investment Fund will be created with $750 million which is designed to create more public housing. Rural housing and a farm labor housing program will receive $2 billion to build new housing, upgrade energy and water efficiency as well as assist with removal of heath and safety hazards. 

Homebuyers having trouble finding affordable housing

Homes have become more expensive over the years, pushing many homebuyers out of the market completely. The First-Generation Downpayment Assistance program is getting $10 billion which will be used to help first-time, first-generation homebuyers purchase a house.

Recipients would qualify for either $20,000 or 10% of the purchase price of a qualified home in financial assistance, whichever is greater. The funds can be used for closing costs, the down payment or even to buy down the interest rate with points. 

In addition, the Home Loan Program is set to receive $5 billion which will be used to subsidize 20-year mortgages for first-generation homebuyers and $100 million will be awarded to HUD-Insured Small Dollar Mortgage Demonstration Program. This program helps eligible homebuyers purchase homes under $100,000.

Finally, the Rural Homeownership program will get $100 million which is earmarked to help homeowners in rural areas keep, upgrade, and repair their homes.

Environmentally Friendly Housing

The Build Back Better bill also addresses climate issues that impact housing. The program will be funded with $2 billion in order to upgrade federal assisted housing units with an eye to energy and water efficiency. 

In addition, the bill earmarks $5 billion for removing lead paint and other health hazards in existing houses. 

Fair and Equitable Housing

The Fair Housing Initiatives Program will receive $700 million while the Fair Housing Assistance Program will get $100 million. This money will be used to enforce fair housing laws. 

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