The showdown between Democrats and Republicans in the 2020 election is certain to have a lasting impact on multifamily housing. With the Democratic Iowa Caucus just around the corner, we thought it would be prudent to do a quick rundown of the housing policies touted by leading Democrats in the primary and their impact on multifamily.
Candidate polling data is based on the latest RealClearPolitics average.
Bernie Sanders (24.2%)
According to the Bernie Sanders 2020 campaign website, the senator aims to “end the housing crisis by investing $2.5 trillion to build nearly 10 million permanently affordable housing units.” To accomplish these goals, Sanders has proposed substantive reforms that would result in a major shift in the status quo for the multifamily industry:
- Federal funds would be leveraged to transition affordable housing into a traditional entitlement program.
- A national rent control cap would limit annual rent increases to 3% or 1.5 times the rate of inflation, whichever is higher.
- The Senator’s proposed 25% “house flipping tax” and 2% “empty home” tax would be implemented to limit the number of housing units currently outside of the marketplace.
- Sanders will also dedicate $70 billion of federal funds toward building new mixed-income units, expanding the national Housing Trust Fund, and rehabilitating the current stock of public housing.
Joe Biden (21%)
- Joe Biden has yet to release a comprehensive housing plan. According to the Joe Biden 2020 campaign website, the former vice president aims to “boost federal investments in those neighborhoods to ensure that every American has access to clean drinking water, well-paved roads, high-speed broadband, safe schools, and affordable housing.”
- According to Biden’s “Plan for Strengthening America’s Commitment to Justice,” the former vice president would ensure that 100% of formerly incarcerated individuals have housing options by authorizing HUD to only award contracts to developers willing to include second-chance housing.
- Mayor Pete Buttigieg has proposed a plan that would see $430 billion invested to “unlock access to affordable housing for over 7 million families” and “increase the supply of affordable housing by building or restoring over 2 million units.”
- Buttigieg has also proposed spending $45 billion annually to help address affordability issues. His campaign has communicated that these goals will be accomplished via reform of zoning laws and capital gains taxes.
- Mayor Buttigieg has also expressed support for numerous housing reform initiatives without giving specifics. Potential policy measures his campaign has referenced include expanding housing voucher programs, reforming local zoning laws, implementing new tenant protections, investing resources into abandoned properties, and addressing the impacts of redlining.
- The Warren 2020 campaign website pledges to invest “$500 billion over the next ten years to build, preserve, and rehab more than three million units that will be affordable to lower-income families.”
- Senator Warren has also announced a $10 billion grant that would be used to incentivize local governments to reform land-use laws.
- Warren’s proposals include fair housing policies designed to protect underrepresented communities from housing discrimination, including reinstating Obama-era anti-discrimination reforms.
- Senator Warren backs the creation of a Tenant Protection Bureau that would enforce new policies and monitor landlords who violate just-cause evictions and other housing policy reforms.
Visit Berkadia’s 2020 Multifamily Forecast for metro-level insights about the future of the housing industry, including the latest estimates of rent growth and new construction nationwide.