U.S. housing experts debate supply and tax reforms

Experts and policymakers are debating various strategies to address the United States housing affordability crisis, which is driven by an insufficient supply of residential units. At a Boston College panel, speakers from the public, nonprofit, and private sectors discussed the need to build more housing faster while balancing regulation, subsidies, and inclusionary zoning. Panelists noted that housing serves as a critical platform for economic opportunity and health outcomes, but cautioned that overly high inclusionary requirements could potentially discourage new construction.

On the legislative front, analysts suggest that current tax codes penalize the construction of rental housing by requiring developers to spread deductions over 27.5 years rather than allowing immediate expensing. To counter this, the Rental Housing Investment Act, introduced by Senator Lisa Blunt Rochester, proposes allowing developers of new rental housing to immediately deduct up to $150,000 per unit, with higher limits for projects meeting specific affordability tests. Proponents argue such measures are necessary to return to historical vacancy rates and relieve overcrowding.