Although Biden’s proposal is the most comprehensive housing plan proposed by a president in recent memory, it is not invulnerable to critique from housing experts. Biden’s planned tax credits may not go as far as the administration might hope in avoiding the “lock-in” effect, wherein homeowners are reluctant to give up their low mortgage rate in order to sell and buy a new house: Julie Fonseca, assistant professor of finance at University of Illinois at Urbana-Champaign, wrote on X that “the tax credit isn’t very large relative to how much low mortgage rates are worth to borrowers,” such that “it might not be enough to incentivize even one seller to sell, let alone two.”
Some believe that Biden could be even more ambitious in his goals. “Given the vision that the president is putting in the budget, then let’s go for it, right?” said Peggy Bailey, vice president for housing and income security at the Center for Budget and Policy Priorities. “Let’s just start to make bigger proposals so that … we can have the proposals ready for the moment that we need them.”
But any such policy is unlikely to be approved by Congress. Even when Democrats held both chambers of Congress and the White House in 2021 and 2022, they were unable to pass ambitious affordable housing proposals. At the end of 2021, efforts to enact the Build Back Better Act—the massive social policy bill championed by Biden and supported by most congressional Democrats—fell apart due to universal opposition from Republicans and at least one conservative Democrat. That bill had included multiple provisions to boost affordable housing, including an expanded low-income housing tax credit and a new tax credit to promote renovating homes in distressed areas, as well as large investments in public housing and housing choice vouchers. (These proposals are echoed in Biden’s budget released this month.)