Senate Advances 21st Century ROAD to Housing Act to Cut Construction Costs and Expand Homeownership

The U.S. Senate advanced legislation this week aimed at tackling the regulatory barriers driving up housing costs across the country, with Senate Majority Leader John Thune (R-S.D.) taking to the floor to make the case for the 21st Century ROAD to Housing Act as a practical solution to the homeownership challenges facing millions of Americans.

Regulations Driving Up the Cost to Build

A central argument behind the legislation is that excessive government red tape has made housing construction significantly more expensive. Regulations now account for roughly 25 percent of the cost of building a new single-family home — and nearly 40 percent of multi-family construction costs. Those figures, cited during Thune’s floor remarks, underscore why new housing has remained out of reach for so many buyers even as demand continues to climb.

Thune framed the bill as a direct response to those structural barriers. “The 21st Century ROAD to Housing Act tackles some of the causes of the higher prices that are preventing too many Americans from realizing the dream of homeownership,” he said.

What the Legislation Does

The bill targets several overlapping layers of regulation that slow housing construction and raise costs at every stage of development. Among its key provisions, the legislation:

• Removes an outdated chassis requirement for manufactured housing, expanding access to one of the most affordable housing options available to working-class families
• Grants state, local, and tribal governments new tools to streamline environmental reviews under the National Environmental Policy Act, right-sizing a process that critics say has become a significant bottleneck for construction projects
• Exempts qualifying rural housing developments from the most extensive layers of environmental review
• Directs the Department of Housing and Urban Development and the U.S. Department of Agriculture to conduct joint environmental reviews for projects that receive funding from both agencies, eliminating duplicative bureaucratic processes
• Encourages local governments to pursue zoning reforms that would allow more housing to be built where it is needed most
• Eases regulatory burdens on community banks and credit unions, and tailors compliance requirements for smaller and newer financial institutions that serve homebuyers in local markets

Relief for Community Lenders

One dimension of the bill that has drawn particular attention from the financial sector is its treatment of smaller lenders. Community banks and credit unions often play an outsized role in financing home purchases in rural and suburban markets, but many have struggled under regulatory frameworks designed primarily for large national institutions. By adjusting those requirements to better reflect the scale and risk profile of smaller lenders, the bill is intended to keep more financing options available to buyers who may not qualify through larger commercial banks.

The provision tailoring rules for newer financial institutions is similarly aimed at expanding competition in the mortgage market — a goal that aligns with broader Republican arguments that regulatory consolidation has reduced consumer choice and driven up borrowing costs over time.

A Legislative Push on Affordability

The Senate’s advancement of the 21st Century ROAD to Housing Act comes as housing affordability remains one of the most consistently cited economic concerns among American households. Rising construction costs, constrained supply, and limited financing access have combined to push homeownership further out of reach for first-time buyers in many regions of the country.

Republican leaders have framed the legislation as a supply-side answer to those pressures — one that works by reducing the government-imposed costs embedded in the building process rather than relying on subsidy programs or price controls. The bill’s combination of environmental review reform, zoning encouragement, manufactured housing updates, and lender relief reflects a broad-based regulatory strategy rather than a single targeted fix.

With the Senate having moved the bill forward, attention will turn to whether the House takes up companion legislation and whether the full package can advance to the President’s desk.