New House bill looks to solve housing supply shortfall
Tackling the challenges surrounding housing affordability is an issue that both Republicans and Democrats seem to agree is a major priority heading into 2026.
While they might not agree on every step to get there, Congress is working on bipartisan legislation to address affordability challenges.
The House Financial Services Committee advanced the “Housing for the 21st Century Act” out of committee this week with a 50-1 vote. It will now move to the House calendar, where it will wait for House leadership to decide if and when it will get floor time.
The bill aims to boost housing production, which many experts say has lagged behind demand. One executive hopes the bill will continue to progress to eventual passage.
Kimber White (pictured top), president of the National Association of Mortgage Brokers, has been on Capitol Hill lobbying in support of the bill. He is hopeful it will help tackle some of the supply challenges. Otherwise, if demand stays high without a corresponding supply increase, prices will increase once again.
“It's a good first step,” White told Mortgage Professional America. “It addresses our housing supply challenges. Like I said to everyone, you can bring rates down and get better terms. But if you're not addressing the supply, you're not doing anything, because all you are going to do is artificially drive housing prices up.”
Alternative housing options
White said he hopes the bill will incentivize not just an increase in housing supply but also in alternative, more affordable housing.
“We definitely need housing, but we need incentives for builders,” White said. “We need alternative programs. I think this starts addressing them. Whether it's the modular homes, whether it's the prefab homes, whether it's the container homes, it gives them incentives and streamlines some of the reviewing process that happens on the federal level.”
By making more alternative housing available, White said it helps more lower- and middle-income families get into homes for the first time.
“They're cheaper and easier to put up,” he said. “The cost is a lot less. You can put them on a smaller land, and you're not going to have large developments. Those are a lot more affordable for a first-time buyer getting into a space than trying to buy a single-family house or condo.”
Another development White is hopeful about with these types of homes is that some big developers will be more open to working with mortgage brokers. It’s an opportunity to benefit the broker community and the builder.
“Clayton Homes has been doing this for quite a while, but it's all been on retail,” White said. “They've been partnered with retail. They didn't partner with brokers. Well, they've left 25% of the market out. So this opens up the opportunity for more homebuyers to be buying and then to actually have more options for financing at lower interest rates than what you're going to get if you go to a manufacturer or home dealer.”
Encouraging small-dollar mortgages
White said a couple of other key improvements to the bill include raising the area median income (AMI) requirements from 80% to 100%. He also noted that environmental approvals would be improved, while still ensuring ample consideration of potential issues.
Another big sticking point with the broker community is how to improve the process so brokers can do more mortgages in areas with lower loan amounts.
“A lot of people don't want to (do small-dollar mortgages) the way the policies are set up for the LO comp rules,” White said. “It streamlines the underwriting process with small-dollar mortgages. This is just basically opening that up. A lot of lenders don't do mortgages under $100,000, and this program opens it up. I think that it's really a start to getting things done.”
Sam Williamson of First American says the Fed will likely proceed cautiously in 2026, with one or two rate cuts expected despite leadership changes. Policy remains data-driven, balancing inflation and employment. Read more and share your thoughts.https://t.co/2nyZa0eFbW
— Mortgage Professional America Magazine (@MPAMagazineUS) December 16, 2025
Getting to do more small-dollar mortgages is just one way that mortgage brokers are making a difference in their local communities. White said brokers must be given the tools needed to keep helping underserved markets.
“We are the people who serve the underserved markets,” he said. “The mortgage broker is more into those underserved markets and communities than the large lenders and the banks. They're there, but they kind of overlook it. We're in those communities every day. We live and work there, and opening these borrowing opportunities to mortgage brokers makes a huge difference.”
The hope is that the House bill will pass in early 2026, since the House has adjourned for the rest of 2025. Then it will need to be reconciled with the Senate-passed ROAD to Housing Act. White is optimistic that things will move quickly because everyone, regardless of party, recognizes this is a major problem.
“When will it go for a vote? I don't know, but I think sooner than later,” White said. “Because everyone knows there's a housing crisis. I was up there on Wednesday, and everyone was talking about a housing crisis. We have to find incentives. We have to get things done. I think this will actually speed up. It’s not going to be overnight, but I think the first of the year, we should see some movement on this.”
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