A new Realtor.com report says five major federal laws drove sharp jumps in U.S. homeownership over the past 160 years—and with a shortage of about 4 million homes, the newly passed 21st Century ROAD to Housing Act could become the next inflection point.
For nearly a century and a half. Americans didn’t just rise into homeownership by “market forces.” At key moments—after the Great Depression. through World War II. during the Civil Rights era. and after the financial crisis—Congress stepped in and rewired who could buy a home and how they could afford one.
A new report released Tuesday by Realtor.com puts hard numbers behind that pattern. It argues that five landmark federal laws sparked the most significant surges in the U.S. homeownership rate over the past 160 years. And it also frames the question now facing lawmakers: whether the newly passed 21st Century ROAD to Housing Act—approved last week with overwhelmingly bipartisan support—will finally deliver the kind of momentum that younger buyers have been waiting decades to see.
“The homeownership rate has never been purely a product of markets. ” Joel Berner. senior economist at Realtor.com’s Austin-based team. said in a statement. “At several major inflection points in this country’s history… Congress stepped in and changed who could own a home and how they could afford one.”.
The stakes are visible in the numbers. The housing market is facing a supply gap of some 4 million homes, and current homeownership sits at about 65% of American households, according to figures from the Federal Reserve Bank of St. Louis.
Last week’s bill could become the next test of whether federal legislation can do what it has done before—move the needle on affordability and access. Berner says the 21st Century ROAD to Housing Act contains provisions aimed at boosting housing supply. which he believes could “relieve some downward pressure on homeownership” by increasing home production and improving matches between prospective buyers and available homes.
“We don’t anticipate a major uptick in homeownership, especially not right away, but the bill has the potential to relieve some downward pressure on homeownership by increasing home production and facilitating more matches with prospective buyers,” Berner said.
That’s not the kind of promise that satisfies people who have been watching prices rise through the window where many younger Americans hoped to buy. Berner argues their frustration is understandable. given that the federal government has offered little comparable intervention during a period when the underbuilding problem has persisted for more than a decade.
“I can see how younger Americans feel that their timing has been especially disadvantageous,” Berner said. Home prices have surged during their window of buying opportunity so much that some people may feel priced out. he added. At the same time. he pointed to two familiar realities: the government has not offered assistance. and current homeowners sit on record levels of equity.
“American leadership has seemed to be content to watch the benefits of homeownership concentrate in the hands of those who were around to buy earlier,” Berner said.
Before lawmakers step back into the spotlight, the report offers a reminder of what “meaningful” Congressional action has looked like historically—especially for generations that came before.
The last housing bill that Berner examined as truly stimulating the homeownership rate was the Fair Housing Act in 1968. That law prohibited discrimination in the sale. rental. and financing of housing based on race. color. national origin. religion. sex. familial status. and disability. After it passed, the homeownership rate climbed steadily from about 64% to nearly 66% by the early 1980s.
Then there was the Housing and Economic Recovery Act of 2008. Berner’s assessment is that its goal was primarily to prevent a collapse in the housing market rather than broaden homeownership. But he argues that without the stabilizing interventions of that legislation. the later dip in the homeownership rate could have been far worse—when the rate dropped to about 63% in 2016. down from as high as 69% in 2004.
And nothing, by Berner’s account, compares with the post–World War II surge.
Thanks to the GI Bill—formally known as the Servicemen’s Readjustment Act of 1944—veterans were guaranteed low-interest, no-money-down home loans backed by the federal government. Between 1940 and 1960, the homeownership rate jumped from almost 44% to nearly 62%.
“The postwar homeownership surge is the most dramatic in American history, and it was not organic,” Berner said. “It was the direct result of Congress making homeownership financially accessible to a generation of Americans who would not otherwise have been able to achieve it.”
The question now is whether the 21st Century ROAD to Housing Act can produce a similar shift—or at least one that feels real to the people trying to buy.
Berner doesn’t expect quick miracles. He says it will take at least five years to judge whether the act proves stimulative. The yardstick. he argues. is whether the bill expands home construction in the places that need it most—where the market is tight and where there have historically been steep regulatory barriers to homebuilding.
“The way the bill will be judged is on whether it leads to expanded home construction in the places that need it most,” Berner said, pointing specifically to markets with tight supply and significant regulatory obstacles to new building.
If Congress has a playbook, the report suggests it’s not just about passing laws. It’s about changing the actual path from “wanting to buy” to “being able to buy.” And after decades of waiting. the housing market will be watching—because this time. the clock for measurable progress is already ticking.
U.S. homeownership Congress housing supply 21st Century ROAD to Housing Act Realtor.com GI Bill Fair Housing Act housing market affordability millennials Federal Reserve Bank of St. Louis underbuilding problem