HomByt Daily Housing News

Congress moves toward bipartisan housing bill — but institutional investor fight could derail it.

House Financial Services Chair French Hill (R-Ark.) said this week he is working through the Senate's housing supply bill with ranking member Maxine Waters (D-Calif.) as both chambers figure out the 'best path forward for a bicameral process that can lead to a housing bill that President Trump can sign.' The sticking point: a Senate provision that would restrict large institutional investors from holding single-family rentals and require new long-term rental homes to be sold after seven years. Hill says House members on both sides are 'concerned' that the restriction would reduce capital flowing into housing and shrink the stock being built. The four key bicameral leaders — Hill, Waters, Senate Banking Chair Tim Scott (R-S.C.), and ranking member Elizabeth Warren (D-Mass.) — have not yet all met to discuss the legislation. The next move is theirs, and the housing market is watching.

One Big Beautiful Bill Act tax benefits are showing up in real filings — and NAR wants Washington to keep going.

As Americans file their taxes this week, the impact of last year's landmark tax reform is landing in real dollars. The One Big Beautiful Bill Act — passed with Trump administration backing — made the mortgage interest deduction permanent, raised the SALT cap from $10,000 to $40,000, and locked in the 20% pass-through deduction for small businesses and independent real estate professionals. NAR's chief advocacy officer says the results are clear: homeowners are seeing lower tax bills, small business owners are reinvesting, and high-cost-state families are getting SALT relief. NAR polling shows 84% of voters support tax-free savings accounts for down payments, and 76% support a capital gains exemption for a one-time home sale. The message from organized real estate: the policy wins are real, but supply and affordability still need urgent attention.

Builder confidence collapses to 7-month low.

The NAHB Housing Market Index plunged to 34 in April, dropping 4 points from March and marking the lowest reading since September 2025. The decline reflects a perfect storm of headwinds: tariff-driven material cost spikes (62% of builders report higher costs), persistently elevated mortgage rates, and growing consumer hesitation. Since December, the index has shed 26 points — nearly cut in half. The message from builders is clear: demand exists, but affordability barriers are becoming insurmountable for a growing share of buyers. Lumber tariffs alone are expected to add $4,700 to the average new home, and with each $1,000 price increase pricing out 150,000 households, the math is getting harder by the month.

Spring 2026 is off to a rough start.

The season that real estate agents and builders had hoped would mark a housing market turnaround instead delivered the worst monthly sales drop in nearly a year. March existing home sales came in at their lowest level since June 2025 — worse than nearly every economist projected. The culprit: a sudden jump in mortgage rates triggered by geopolitical instability, combined with broader consumer anxiety around inflation and economic uncertainty. After briefly dipping below 6% in late February, rates reversed course and now sit at 6.37%. That half-percentage-point swing alone knocked more than a million households out of qualifying range for the median new home.

Inventory is rising, but the market remains uneven.

Nationally, housing supply is now 23.4% above its long-term average — a meaningful shift that gives today's buyers more leverage than they've had in years. That means longer days on market (41 days in March vs. 36 a year ago), more seller concessions, and room to negotiate. But the surplus isn't evenly distributed. Southeast and Southwest markets are seeing above-prepandemic inventory levels, while Northeast and Midwest markets remain undersupplied. In undersupplied markets, competition is still intense and prices remain firm.

Policy is in motion but uncertainty is weighing on capital.

Congress is working on landmark bipartisan housing legislation — the most comprehensive package since 2008 — but a standoff between the House and Senate over institutional investor restrictions has frozen capital for build-to-rent projects. Developers say the proposed seven-year mandatory disposal requirement is unworkable, and major capital providers have paused commitments while they wait for clarity. Meanwhile, the White House is pushing new tax benefits for homeowners and REALTORS® through the One Big Beautiful Bill Act, including a permanent mortgage interest deduction and a SALT cap raised to $40,000. These measures provide meaningful relief, but the road to housing affordability remains long.