Joe Biden has big plans for the housing market, and especially for housing affordability. CNBC says Biden’s housing plan could relieve buyers by easing the pressure on home prices and supply. Possible proposals from Biden’s housing plan could include a $15,000 first-time homebuyer tax credit, which would be immediately accessed and used for a down payment. In addition, Biden is predicted to urge big banks to return to FHA lending, and he wants to ramp up residential construction. These policy changes could help first-time buyers, who made up 32% of all November home purchases—a low compared to the typical 40%.
The tax credit could exacerbate the inventory shortage, by juicing demand even more. But the nation’s homebuilders, who have had a difficult time keeping up with demand, could also get a boost from Biden. They have been hampered by the high costs of land, labor, materials and regulations.
The Trump administration’s restrictive immigration policies exacerbated an already severe labor shortage for builders, as many documented and undocumented construction workers had left the industry during the last housing crisis. As the construction industry flourished again, some workers were still afraid or unable to come back into the U.S.
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