In recent years, a greater bipartisan urgency has emerged to address the nation’s housing challenges, as families in red and blue states alike are facing shortages of housing for rent and for sale, rising rents and home prices, and threats to their housing stability. The Renewing Opportunity in the American Dream (ROAD) to Housing Act is one of Congress’s potential vehicles to tackle these problems and is expected to be marked up in the Senate in the coming weeks.

The bill proposes various solutions to a range of issues, including loosening regulatory and credit barriers to housing production and homebuying, strengthening mechanisms to stabilize renters and homeowners, and reducing homelessness.

If designed correctly, this bill could be the first step to ensure every family has a stable, quality, and affordable home. To help map the road ahead, we pull from our recent analysis to highlight three of the bill’s key provisions and provide recommendations on how the Senate can ensure this bill meets its expressed goals during its markup.

1. Preventing foreclosures by improving housing counseling and financial literacy

The ROAD to Housing Act seeks to help struggling borrowers repay their debts and avoid foreclosure by reforming the US Department of Housing and Urban Development’s (HUD’s) housing counseling program. Specifically, the bill proposes to redefine priority markets, extend financial resources for counseling borrowers who are 60 days or more delinquent on government-backed mortgages, and adding criteria to assess the “competence” of HUD-approved housing counselors.

Preventing foreclosures doesn’t just benefit borrowers and communities, it protects all participants in the housing finance system and even helps expand access to credit for new homebuyers. When foreclosures occur, the guaranteeing entity—often the Federal Housing Administration (FHA) or the government-sponsored enterprises (GSEs) Fannie Mae or Freddie Mac—incurs the greatest loss, as they must compensate investors for the unpaid balance. In 2024, the FHA lost 25 percent of the unpaid mortgage balance per foreclosure (PDF).

Urban Institute research suggests that providing more resources to housing counselors and prioritizing areas with the greatest need can help reduce foreclosures. However, there isn’t reason to believe that existing counselors have a competence problem or that counseling can increase the risk of foreclosure. In fact, HUD-approved housing counselors are already subject to intensive performance reviews and certification standards to demonstrate their ability to provide quality services.

What else could reduce foreclosures?

During the pandemic, the FHA’s and GSEs’ loss mitigation programs lowered foreclosure rates to pre–Great Recession levels, preventing more than half a million foreclosures. To keep borrowers paying back their mortgage debts and prevent losses to the federal mortgage entities, the bill could codify these programs into statute and ensure veteran borrowers have comparable options.  

2. Allowing regulatory flexibility in manufactured housing

Manufactured housing—factory-built homes that are delivered to the site—can be significantly cheaper and faster to build and permit than site-built homes, making them a promising source of affordable housing. But there are a few barriers to scaling this market.

The ROAD to Housing Act seeks to address one major limitation by removing the long-standing HUD requirement that manufactured homes maintain their chassis—the elevated steel underpinning used to deliver the homes to their site. Urban research indicates that eliminating this requirement would allow more manufactured homes to be placed in vacant or underutilized lots.

What else can advance factory-built housing?

Scaling the manufactured housing market also depends on how easy these homes are to buy. Though these homes themselves tend to be cheaper, the financing needed to purchase them is more costly and difficult. The interest rates and denial rates for chattel loans, which are largely used­­ to buy manufactured homes, are significantly higher than for traditional mortgages, and land rent increases can be unsustainable for owners. To increase liquidity in the manufactured housing market, the bill could mandate the GSEs to buy personal property loans as part of their Duty to Serve plans for underserved markets.

3. Promoting housing opportunities in Opportunity Zones

As the largest ongoing economic development program in the nation by expenditure, the Opportunity Zones (OZ) program has mobilized more than $100 billion in private investment in its lifetime, much of it in market-rate multifamily housing projects. The ROAD to Housing Act seeks to further leverage the OZ program by prioritizing HUD construction and rehabilitation grants in communities designated as distressed neighborhoods across the country.

Currently, more than 75 percent of OZ investment flows into only 5 percent of designated zones, and research suggests the OZ program should first be redesigned to better support affordable housing in places where it is most needed. Before going further, this bill can start by commissioning a study to better understand how and where OZ investments are being used to finance new housing projects.

How else could Congress address the housing supply crisis?

Congress can effectively increase the housing supply by expanding and reducing barriers to the Low-Income Housing Tax Credit, the nation’s largest financing source for affordable rental housing. Similarly, the proposed Neighborhood Homes Investment Act would help developers pencil out construction and rehabilitation of housing for sale in distressed communities across the country. Combined, these proposals could create 2.5 million homes in 10 years.

 What else can Congress do?

Today, 21.5 million families pay more than 50 percent of their income on housing costs. To tackle this problem and ease strained household budgets, Congress ultimately needs to help enable the production and rehabilitation of millions of affordable homes and ensure all families can access and sustain housing.

The US has pulled itself out of greater housing crises before through concerted, large-scale federal action—namely the Housing Act of 1949 and the Housing and Urban Development Act of 1968 (PDF). These landmark pieces of legislation funneled unprecedented investments in public housing, federal mortgage insurance, rental assistance, and more.

The ROAD to Housing Act could be the first mile marker to addressing the nation’s housing challenges. But the full journey will require more financial investment to sufficiently support housing supply, affordability, and sustainability. With proper navigation, a federal housing package can fuel us further down the road toward an affordable and stable home for every family.