As Vice President Kamala Harris makes her bid for president, one of her major plans is to try and address housing issues such as low inventory, higher home prices and the lack of affordable housing in the U.S.
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While she and President Joe Biden have already made strides in this direction, Harris and her VP pick, Minnesota Gov. Tim Walz, plan to build upon their existing efforts both at the policy level and by directly putting more money into homebuyers’ wallets.
Real estate experts explain how the Harris-Walz housing plan could be a boon to homebuyers in multiple ways.
It Calls for New Construction
The first part of the Harris-Walz housing plan calls for the construction of 3 million new housing units over the next four years, a solution to the housing supply shortage. In order to do this, they promise they will work “in partnership with industry” to build the houses available for both purchase and rent, and to “take down barriers that stand in the way of building new housing” with the aim of bringing down the cost of both rent and mortgages, should they be elected.
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It Offers a Tax Incentive for Building Starter Homes
Additionally, the Harris-Walz plan also proposes a “first ever” tax incentive for homebuilders who build starter homes that are sold to first-time homebuyers. They view this as a supplement to the Neighborhood Homes Tax Credit, which incentivizes investment in properties that might otherwise be too expensive or challenging to build or renovate.
It Tackles Corporate Rent Gouging
Another initiative builds on steps already taken by the Biden-Harris administration, cracking down on corporate landlords and working to ensue that all landlords adhere to fair and legal rental practices. This would include stopping big investors from buying homes in bulk and marking up their prices. They also seek to prevent “price fixing” a technique that can jack up rent prices exorbitantly.
It Promises $25,000 Down Payment Assistance
Perhaps the most dramatic proposal of the housing plan is the promise to offer $25,000 in down payment assistance to “working families” who have paid rent on time for two years and who are buying their first home. The plan suggests that it would make homeownership accessible to more than 4 million people.
This assistance could widen the options of houses available to first-time homebuyers, according to Dino Dinenna, a real estate broker at Hilton Head Realty.
“Conservatively, with a 5% down payment on a FHA mortgage and a $25,000 down payment credit, you could afford a home of up to $500,000. This gives hope to a lot of people who always thought housing was out of reach,” he said.
It Could Provide Access to Better Loan Rates
Justin Godur, a financial advisor, real estate expert and the founder of Capital Max, calls the housing plan “a game changer” and not just for the obvious reason.
“Yes, the down payment assistance is a significant benefit, but there’s more to it. In my view, the real value lies in how this plan can empower buyers to access better loan terms and potentially lower interest rates. By reducing the financial burden upfront, buyers can focus on building long-term equity rather than scrambling to meet monthly mortgage payments.”
It Could Level the Playing Field
Additionally, Godur said that one of the less obvious advantages is how this plan helps level the playing field for buyers in competitive markets.
“In places like California or New York, where housing prices are soaring, many first-time buyers are priced out simply because they can’t compete with cash buyers. But with this kind of assistance, they’re given a fighting chance.”
It Could Promote Overall Economic Stability
Housing stability directly influences a person’s financial situation, Dinenna said.
“If underprivileged people can afford to live in a house, they have more disposable income, which helps their local economies.”
It Could Provide Peace of Mind
Godur said he’s seen how access to financial relief not only improves purchasing power but also provides peace of mind.
“Homebuyers can invest in their property without sacrificing their financial stability. Ultimately, this plan isn’t just about helping people buy homes; it’s about fostering long-term economic growth for individuals and communities alike.”
It Could Address Homeownership Disparities
Jake McClure, CEO at Burling Square Group, pointed to the Biden-Harris administration’s existing work addressing homeownership disparities among minorities as a hopeful sign that the proposed Harris-Walz housing plan would continue this work, should they be elected.
“I’ve worked with a lot of minority families who struggle with generational wealth gaps, and targeted initiatives like this can make a significant difference in closing that gap,” McClure said.
He added, “Creating opportunities for communities that have been left out of the housing market for too long is crucial, and this plan helps move that needle forward.”
Even if Harris wins the election, many of these plans will still require congressional approval. The reality of either candidate’s housing plans will be determined well after Nov. 5.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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This article originally appeared on GOBankingRates.com: How Harris’ Housing Plan Could Be a Boon for First-Time Homebuyers
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