21st Century ROAD to Housing Bill Becomes Law, Seeks to Boost Housing Supply

The 21st Century ROAD to Housing Act, P.L. 119-101, (the Act) became law in July 2026. The law touches several facets of U.S. housing, including finance, construction and regulation. During the legislative process, the bill "ping-ponged" back and forth between the U.S. House of Representatives and Senate as the chambers endeavored to work out their differences. Ultimately, the legislation was transmitted to the White House on June 29, 2026, and it became law without presidential action on July 11, 2026 (Effective Date).¹

Overview

The Act is organized into 12 titles addressing distinct but related aspects of federal housing policy. Title I (Opportunities for Housing) and Title II (Building More in America) form the core of the Act's supply-side agenda, streamlining environmental review, zoning guidance and permitting processes while creating new grant programs to spur construction, including for affordable, infill and adaptive-reuse housing. Title III (Manufactured Housing for America) and Title IV (Accessing the American Dream) focus on expanding financing options, including for manufactured and modular housing and small-dollar mortgages to lower barriers to homeownership. Title V (Program Reform) modernizes several U.S. Department of Housing and Urban Development (HUD) and U.S. Department of Agriculture (USDA) flagship housing programs, including HOME Investment Partnerships, Rural Housing Service programs, disaster recovery funding and the Moving to Work demonstration.

Title VI (Veterans and Housing) and Title VII (Oversight and Accountability), together with Title VIII (Accountability, Coordination, Studies, and Reporting), address veteran-specific disclosures and benefits while imposing new reporting, testimony and interagency coordination requirements on HUD, USDA and the U.S. Department of Veterans Affairs (VA). Title IX (Strengthening Community Banks' Role in Housing) provides targeted regulatory relief for community banks and credit unions to support local housing lending, while Title X (Home-Ownership for Main Street America) restricts large institutional investors from purchasing single-family homes (SFH) at scale. Title XI (Central Bank Digital Currency) prohibits the Federal Reserve (Fed) from issuing a central bank digital currency through 2030, and Title XII (Miscellaneous) contains standard severability and appropriations provisions.

Taken together, the Act reflects a bipartisan effort to increase housing supply, expand access to affordable financing, and strengthen oversight of federal housing programs and institutions that participate in them.

Legislative Summary

Title I: Opportunities for Housing

Section 101, Reforms to Housing Counseling and Financial Literacy Programs. Amends the Housing and Urban Development Act of 1968 to reform housing counseling programs, including requiring geographic diversity among recipients, authorizing periodic performance reviews of counseling organizations, establishing counselor performance comparisons, and providing for counselor certification and decertification procedures. It also requires that delinquent borrowers on covered mortgage loans be given an opportunity to participate in available housing counseling, with costs paid by the Mutual Mortgage Insurance Fund if certain conditions are met. Organizations facing denial of renewal of counseling assistance are entitled to at least 60 days' prior written notice and, if timely requested, an informal conference with the Deputy Assistant Secretary of Housing Counseling before the denial is finalized.

Section 102, Federal Guidelines for Point-Access Block Buildings. Directs the HUD Secretary to issue guidelines within 18 months providing states, territories, Tribes and localities with model code language and best practices for permitting point-access block (single-stair) residential buildings of up to six stories. Authorizes competitive grants for pilot projects evaluating safety, feasibility or cost effectiveness, with a seven-year sunset.

Section 103, Exemption on Construction or Modification of Residential Housing Located on an Infill Site. Exempts the Agriculture Secretary from conducting environmental effect studies for USDA housing assistance used for construction or modification of residential housing on infill sites. Requires the Agriculture Secretary to submit a report to the U.S. Congress within five years of the bill's enactment, with such report evaluating whether the exemption reduced review times and administrative costs, among other things.

Section 104, Database of Publicly Owned Land. Requires Community Development Block Grant (CDBG) grantees to maintain a publicly accessible, searchable database identifying all parcels of undeveloped land the CDBG owns, effective as of October 1, 2026.

Section 105, FHA Small-Dollar Mortgages. Authorizes the HUD Secretary, acting through the Federal Housing Commissioner of the Federal Housing Administration (FHA), to establish a pilot program within one year to increase access to small-dollar mortgages (defined as having "an original principal balance of $100,000 or less") through direct payments to mortgagees, adjusted terms, grants for closing costs, outreach and technical assistance. The program sunsets four years after establishment, with authority to establish new programs expiring three years after enactment.

Section 106, Temperature Sensor Pilot Program. Establishes a three-year pilot program for HUD to provide grants to public housing agencies and owners of covered federally assisted rental units to acquire, install and test temperature sensors to ensure compliance with temperature requirements.

Section 107, Housing Supply Frameworks. Directs HUD's Assistant Secretary for Policy Development and Research to publish guidelines and best practices for state and local zoning frameworks within three years, covering topics such as parking minimums, density, accessory dwelling units (ADU), transit-oriented development and more. Requires a task force, public comment, and a five-year follow-up report on adoption. Abolishes the Regulatory Barriers Clearinghouse and repeals Section 1205 of the Housing and Community Development Act (42 U.S.C. 12705d).

Title II: Building More in America

Section 201, Increasing Housing in Opportunity Zones. Authorizes HUD to give additional weight to competitive grant applicants whose projects are located in or benefit qualified opportunity zones.

Section 202, Whole-Home Repairs Act. Authorizes a pilot program providing grants to organizations to administer whole-home repairs for eligible homeowners and landlords (those with fewer than 10 properties and a majority of affordable units but not more than 25 total units). Includes detailed provisions on eligible uses, loan agreements with rent caps and affordable housing maintenance requirements, application procedures, reporting requirements and workforce training. Sunsets October 1, 2031.

Section 203, Community Investment and Prosperity Act. Increases the public welfare investment limit for national banks and state member banks from 15 percent to 20 percent of capital and surplus. Requires biennial reports from the Office of the Comptroller of the Currency (OCC) and Fed on such investments.

Section 204, Addition of Affordable Housing Construction as an Eligible Activity. Adds new construction of affordable housing as an eligible CDBG activity (capped at 20 percent of a recipient's allocation).

Section 205, Better Use of Intergovernmental and Local Development (BUILD) Housing Act. Authorizes HUD to designate environmental review procedures for its assistance as special projects, streamlining National Environmental Policy Act (NEPA) compliance. Extends Tribal assumption of environmental review obligations.

Section 206, Unlocking Housing Supply Through Streamlined and Modernized Reviews Act. Requires HUD to expand and reclassify housing-related activities under NEPA to create exempt activities, categorical exclusions and other streamlined categories covering tenant-based rental assistance, supportive services, rehabilitation projects, new construction of up to 15 units, infill projects and more. Requires a five-year annual report to Congress.

Section 207, Grants for Planning and Implementation Associated with Affordable Housing. Authorizes HUD to establish a competitive grant program for eligible entities (states, cities, regional planning agencies) to assist with housing planning and implementation activities, with a five-year sunset.

Section 208, Innovation Fund. Authorizes a competitive grant program rewarding metropolitan cities, urban counties and other local governments that have demonstrated objective increases in housing supply. Grants range from $250,000 to $10 million, with authorized appropriations of $200 million per year for fiscal years (FY) 2027 to 2031. The program sunsets seven years after enactment.

Section 209, Accelerating Home Building Act. Authorizes grants to eligible entities to select pre-reviewed designs ("pattern books") of covered structures (low-rise/mid-rise mixed-income housing) to streamline local permitting. Requires a 10 percent set-aside for rural areas.

Section 210, Revitalizing Empty Structures Into Desirable Environments (RESIDE) Act. Establishes a five-year pilot program to award competitive grants of $1 million to $10 million to participating jurisdictions to convert vacant and abandoned commercial buildings into housing.

Section 211, Housing Affordability Act. Significantly increases FHA multifamily mortgage insurance program per-unit dollar limits (approximately tripling or quadrupling prior limits) across multiple National Housing Act sections covering rental housing, cooperatives and condominiums. Requires a study on the impact of the increases.

Section 212, Rental Assistance Demonstration Program. Makes the Rental Assistance Demonstration program authority permanent, increases unit conversion cap from 455,000 to 555,000 and requires annual assessment of conversion impact on public housing preservation.

Section 213, Build Now Act. Adjusts CDBG formula allocations for eligible recipients based on their "housing growth improvement rate," providing bonuses for jurisdictions at or above the median rate and reducing allocations by 10 percent for those below. The provision takes effect in the third full fiscal year after enactment and remains in effect through FY 2043.

Title III: Manufactured Housing for America

Section 301, Housing Supply Expansion Act. Amends the definition of "manufactured home" to include homes built without a permanent chassis, requires revised standards for such homes and mandates state certification treat such homes in parity. Prohibits the manufacture, installation or sale of covered manufactured homes in non-certifying states. Provides that energy efficiency standards for manufactured homes can take effect only if adopted by HUD through its consensus process.

Section 302, Modular Housing Production Act. Requires HUD to review FHA construction financing programs for barriers to modular home methods and publish a report within one year, followed by rulemaking on alternative draw schedules. Authorizes a grant to study a standardized uniform commercial code for modular homes.

Section 303, Property Improvement and Manufactured Housing Loan Modernization Act. Significantly increases FHA Title I loan limits for manufactured homes and home improvements, extends maximum loan terms to up to 30 years, adds accessory dwelling units as an eligible use and requires new annual indexing. Requires a study on cost effectiveness of off-site construction.

Section 304, PRICE Act. Establishes a new program to provide competitive grants for the development of or improvements to eligible manufactured housing communities, including infrastructure, reconstruction, home replacements and community services. Sunsets after seven years.

Title IV: Accessing the American Dream

Section 401, Creating Incentives for Small-Dollar Loan Originators. Requires the Consumer Financial Protection Bureau (CFPB) to submit a report to Congress within 270 days on loan originator compensation practices, including the effect on small-dollar mortgage availability.

Section 402, Small-Dollar Mortgage Points and Fees. Requires the CFPB Director, within 270 days, to evaluate the impact of qualified mortgage points and fees thresholds on small-dollar mortgage originations.

Section 403, Appraisal Industry Improvement Act. Reforms FHA appraiser requirements to allow federal employees to be licensed in one state to appraise in all, requires verifiable education in FHA appraisal requirements, allows appraisal management company fee adjustments, adds state credentialed trainee appraisers to the national registry and authorizes workforce training grants.

Section 404, Helping More Families Save Act. Establishes an Escrow Expansion Pilot Program under which up to 25 eligible entities can create interest-bearing escrow accounts for up to 5,000 covered families receiving Section 8 or Section 9 assistance, depositing amounts equal to rent increases attributable to earned income gains. Terminates 10 years after enactment.

Section 405, Choice in Affordable Housing Act. Allows housing choice voucher inspection requirements to be satisfied by inspections conducted under the Low-Income Housing Tax Credit, HOME Investment Partnerships or Rural Housing Service programs. Permits remote/video inspections in rural areas and allows preapproval inspections for new landlords.

Title V: Program Reform

Section 501, HOME Investment Partnerships Reauthorization and Reform Act. Reforms the HOME program by raising income eligibility for assisted families; eliminating the per-unit investment limitation; adding a qualification exception for rental units with Section 8 voucher holders; raising home-ownership purchase price limits from 95 percent to 110 percent of median; creating new exceptions for military members and heirs of deceased owners; eliminating the right-to-draw expiration; reforming environmental review with categorical exemptions; increasing minimum allocations from $500,000 to $750,000; and strengthening enforcement penalties. Also permits certain non-entitlement jurisdictions to use HOME funds for related infrastructure improvements, expands rental and homeownership qualification exceptions, and supports shared-equity and community land trust models, including mechanisms to preserve long-term affordability. This section further exempts qualifying small projects from Section 3 requirements, limits reallocations where jurisdictions fail to meet HOME requirements and creates specified exceptions to tenant and participant protection requirements for certain small affordable rental properties. Also requires HUD to review and issue updated guidance on the application of the Build America, Buy America Act to HOME-assisted activities, with a report to Congress on the results of the review.

Section 502, Rural Housing Service Reform Act. Reforms the USDA's Rural Housing Service programs, including by decoupling rental assistance from maturing mortgages to preserve affordable housing in rural areas. Permanently establishes a Housing Preservation and Revitalization Program under which the Agriculture Secretary must provide annual notice to owners and tenants of properties with maturing loans regarding extension and decoupling options and increases the rehabilitation-related transfer threshold from 9 percent to 25 percent. Provides foreclosure and rental assistance preservation, staffing and information technology upgrades, the Rural Community Development, annual rural housing reporting, voucher-adjustment rules, rural voucher eligibility, nonprofit and public-body transfer provisions, 40-year loan modifications, assumption-fee rules, childcare-related loan restriction changes, ADU rental income and application-review reporting. According to the House Committee on Financial Services, this section will help preserve housing access for 400,000 rural families.

Section 503, Incentivizing Local Solutions to Homelessness. Authorizes recipients of Emergency Solutions Grants to request waivers of the expenditure limit, subject to demonstrating local needs and submitting a detailed plan.

Section 504, Reforming Disaster Recovery Act. Establishes the Long-Term Disaster Recovery Fund and a new CDBG Disaster Recovery Program. The purpose of this section is to streamline disaster recovery efforts and empower public housing agencies. Authorizes data-sharing among HUD, the Federal Emergency Management Agency and U.S. Small Business Administration to coordinate disaster recovery assistance and prevent duplication of benefits, subject to privacy protections. The new CDBG Disaster Recovery Program sunsets three years after enactment.

Section 505, New Moving to Work Cohort. Establishes a new "Moving to Work" demonstration program to provide Public Housing Authorities exemptions from certain public housing and voucher rules, allowing them to design and test innovative, localized strategies to improve self-sufficiency and housing assistance.

Title VI: Veterans and Housing

Section 601, Military Service Question. Requires Government Sponsored Enterprises (i.e., Fannie Mae and Freddie Mac) to include a disclosure on the Uniform Residential Loan Application (URLA) to inform military veterans that they might qualify for a VA home loan. Directs the U.S. Government Accountability Office (GAO) to study, within 18 months, whether not less than 80 percent of lenders using the URLA have included the required disclosure.

Section 602, Housing Unhoused Disabled Veterans Act. Excludes VA disability benefits from income for purposes of determining eligibility for certain HUD-VA housing programs.

Section 603, Veterans Affairs Loan Informed Disclosure Act. Requires the FHA informed consumer choice disclosure to include information about VA loan options. Requires the URLA to include a military service question. Clarifies that lenders are not required to determine a borrower's eligibility for a VA loan. Requires the Federal Housing Finance Agency (FHFA) to issue implementing rules within six months.

Title VII: Oversight and Accountability

Section 701, Requiring Annual Testimony and Oversight from Housing Regulators. Requires the HUD Secretary to appear annually to testify before the House and Senate on operations, public housing conditions, FHA fund health, oversight, homelessness and HUD capacity.

Section 702, FHA Reporting Requirements on Safety and Soundness. Requires the HUD Secretary to submit monthly reports on the FHA capital ratio and immediately notify Congress if the fund falls below the required capital ratio.

Section 703, United States Interagency Council on Homelessness Oversight. Requires the United States Interagency Council on Homelessness (USICH) to submit annual reports on the status of its strategic plan and testify before Congress, if requested.

Section 704, Appraisal Modernization Act. Requires federal agencies (USDA, VA, FHA, FHFA) to implement reconsideration-of-value procedures for federally backed mortgage loans. Directs GAO to conduct a feasibility study on creating a publicly available appraisal database. Following completion of the GAO report, the bill requires the Senate Committee on Banking, Housing, and Urban Affairs and House Committee on Financial Services to each hold a hearing on the findings and feasibility of establishing a public appraisal database.

Title VIII: Accountability, Coordination, Studies and Reporting

Section 801, HUD-USDA-VA Interagency Coordination Act. Requires HUD, USDA and VA to establish a mechanism, such as a Memorandum of Understanding (MOU), for sharing housing research and market data and submit a joint report to Congress within 180 days to identify 1) opportunities for collaboration and 2) federal laws adversely affecting housing availability.

Section 802, Streamlining Rural Housing Act. Requires HUD and USDA to enter into an MOU within 180 days to evaluate environmental review categorical exclusions, develop lead-agency processes and evaluate joint physical inspections for co-funded housing projects.

Section 803, Improving Self-Sufficiency of Families in HUD-Subsidized Housing. Directs HUD to study the implementation of work requirements by Moving to Work demonstration public housing agencies, if sufficient data and agencies are available.

Section 804, GAO Studies. Mandates four GAO studies within one year: 1) workforce housing obstacles and a recommended federal definition, 2) options to improve housing for the elderly or disabled, 3) proximity of housing to Superfund sites and 4) residential heirs' property, including prevalence, resources available and recommendations for reform.

Section 805, Improving Public Housing Agency Accountability. Requires covered public housing agencies (those with appointed receivers or federal monitors) to provide annual notices to HUD and make public disclosures of contract information, requires receivers/monitors to submit annual written assessments to Congress and authorizes the HUD Inspector General to conduct reviews and provide a compliance and oversight analysis to a requesting congressional committee within 180 days of a written request.

Title IX: Strengthening Community Banks' Role in Housing

Section 901, Community Bank Deposit Access. Creates a limited exception for custodial deposits at eligible institutions (under $10 billion in assets) to provide these are not considered to be brokered deposits if the total amount does not exceed 20 percent of an institution's total liabilities.

Section 902, Keeping Deposits Local. Increases the amount of reciprocal deposits not considered brokered on a tiered basis (50 percent of the first $1 billion, 40 percent of $1 billion to $10 billion and 30 percent of $10 billion to $96.3 billion). Modifies agent institution eligibility and requires a study on reciprocal deposits.

Section 903, Tailored Regulatory Updates for Supervisory Testing. Raises the asset threshold for an on-site examination cycle from $3 billion to $6 billion.

Section 904, Credit Union Board Modernization. Allows well-rated federal credit union boards to meet less frequently, while de novo credit unions must still meet monthly for five years.

Section 905, Systemic Risk Authority Transparency. Enhances GAO review requirements following systemic risk determinations and requires the appropriate federal banking agency to submit reports to Congress within 90 days and within 210 days disclosing exam reports, supervisory communications, mismanagement details and legislative recommendations.

Section 906, Advancing the Mentor-Protégé Program for Small Financial Institutions. Establishes a new program under which large financial institutions or financial agents of the U.S. Department of the Treasury may mentor small financial institutions (under $2 billion in assets, minority depository institutions or rural institutions).

Section 907, American Access to Banking. Requires federal financial institution regulatory agencies to streamline de novo institution application processes, designate caseworkers for applicants, provide mentor-protégé partnerships and develop state/stakeholder engagement plans.

Section 908, Promoting New Bank Formation. Authorizes a two-year capital standards pilot phase-in for qualifying community banks and their holding companies and allows deviation from approved business plans during the first two years. Requires studies on the impact of the pilot program and de novo institution formation barriers.

Section 909, Rural Depositories Revitalization Study. Requires federal banking agencies to jointly study methods to improve rural depository institution growth, capital adequacy and profitability and the National Credit Union Administration to conduct a parallel study on rural credit unions.

Title X: Homeownership for Main Street America

Section 1001, Homes Are for People, Not Corporations. Prohibits "large institutional investors" (LIIs) – entities with investment control over not less than 350 SFH acquired after enactment – from purchasing, directly or indirectly, SFHs subject to various complex exceptions such as for newly constructed or renovated homes, build-to-rent programs, renovate-to-rent programs, homeownership programs and others. An SFH includes structures with two or fewer dwelling units but excludes manufactured homes. Requires HUD to establish a renter outreach resource (toll-free number and website) for tenants of LIIs to report disputes. Authorizes civil penalties of up to $1 million per violation or three times the purchase price, whichever is greater. The prohibition takes effect 180 days after enactment and is repealed 15 years after the Effective Date. Imposes a reporting requirement on LIIs whereby they must report their SFH holdings.

Title XI: Central Bank Digital Currency

Section 1101, Central Bank Digital Currency. Prohibits the Fed from issuing a central bank digital currency (defined as a dollar-denominated digital asset that is a direct liability of the Fed and widely available to the general public) directly or indirectly through intermediaries, with an exception for dollar-denominated currency that is open, permissionless and private. The prohibition sunsets on December 31, 2030. Includes a rule of construction clarifying that nothing in this section shall be construed to allow the Fed to issue a central bank digital currency or any substantially similar digital assets, directly or indirectly, absent authorization by an act of Congress.

Title XII: Miscellaneous

Section 1201, Severability. Contains a severability clause for the legislation.

Section 1202, No Additional Funds Authorized. Provides that no additional funds are authorized to be appropriated to carry out the Act or its amendments.

Notes

¹ Article 1, Section 7, Clause 2 of the U.S. Constitution is the "presentment clause" that provides a bill automatically becomes law on the 10th day (Sundays excepted) after the bill is presented to the president if the Congress has not adjourned and the president has taken no action on the bill.

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