Industry News - January 2022
1. Congress raises debt ceiling by $2.5T
This week, House and Senate Democrats in Congress voted to increase the debt ceiling by $2.5T, which is predicted to cover the nation’s financial obligations through the end of 2022. On Thursday, President Biden signed it into law. The measure increased the debt limit to $31.4T from the current cap of $28.9T. Senators voted 50-49 along party lines to pass the bill after previously securing a deal to require only a simple majority for passage. This tactic averts a potentially dangerous game of chicken over defaulting on the nation’s debt obligations, which would likely have severe, if not catastrophic consequences, for Americans. House members voted 221-209 to clear the bill.
2. Senate to delay consideration of Biden agenda until 2022
Senate Majority Leader Chuck Schumer has decided to delay the consideration of President Biden’s $1.75T economic plan until after the new year. Though Senate Democrats previously set ambitious deadlines for the passage of the Build Back Better Act (BBB), negotiations have stalled as Senate leaders struggle to gain the support of West Virginia Senator Joe Manchin. With a 50-50 split between political parties in the Senate and no support expected from Republicans, the bill will need the vote of every Senate Democrat to pass. The Build Back Better Act has been a pillar of Biden’s presidency, and its passage – or failure – will likely shape the results of next year’s midterm election. The BBB contains nearly $150B in Housing investments.
3. Promoting Affordable Housing Near Transit Act included in the NDAA
Congress voted Wednesday to pass the 2022 National Defense Authorization Act (NDAA), which included language beneficial to the multifamily housing industry. The Promoting Affordable Housing Near Transit Act establishes a process for non-profits or other third parties to receive a land transfer from a federal transit grant recipient at no cost if the transfer is used for affordable housing. Under current law, recipients of federal transit funding may transfer property no longer needed for a project to a state or local government at no cost; however, it does not allow recipients to do the same for non-profit or other non-governmental entities.
4. Experts Predict What The Housing Market Will Look Like in 2022
Home buying will continue to rise in 2022. Chief Economist at Realtor.com, Danielle Hale believes we will see a 6.6% increase in home sales and 2.9% increase in home prices in the coming year. As prices continue to rise, affordability will remain the key issue in the coming year for home buyers. With that being said, Carlo Siracusa, president of Weichert Residential Sales says, “Buyer demand will continue to be driven by higher wages, improving employment and rising stock market values.” This could provide first-time home buyers to enter the market, especially as rent prices continue to rise at a faster pace than single-family homes.