Nearly three months after the 21st Century ROAD to Housing Act became law, housing industry leaders are already huddling up to develop a sequel – a “ROAD 2.0” bill – meant to build on its success and momentum.
Behind the scenes, lawmakers on Capitol Hill may be laying the groundwork. A 95-page document from the 40-member, bipartisan Build America Caucus, packed with proposals on housing, healthcare, energy, innovation, and transportation, offers an early look at the policies that follow-up housing bills could include.
The document, first shared by Politico, focuses on three main housing policy avenues: expanding where housing can be built, reducing the cost and delay of building housing and improving access to capital for housing projects. While many of the policies would be implemented on a local level, the document outlines ways that the federal government can incentivize state and local governments to enact pro-housing reforms.
Some of the ideas echo provisions left out of the final version of ROAD, while others would break new ground. Here’s a closer look at each of the three areas, and the specific proposals under them.
Opening up more sites for housing development
The housing agenda’s first section, “Expand where housing can be built,” focuses on easing local constraints that limit where developers and builders can construct new housing. The agenda outlined three specific proposals that could unlock more sites for residential development, paired with federal actions that could incentivize local governments to follow suit.
Right to Build Zones
Many municipalities, folding to pressure from NIMBY groups or relying on outdated zoning policies, haven’t built enough homes to keep up with population growth. To combat this problem, the agenda calls for localities to enact “Right to Build Zones” – areas where housing would gain automatic by-right approval as long as it complies with standardized zoning and permitting rules.
The document argues that this proposal would cut delays and costs that drive up the cost of housing. The federal government would incentivize municipalities to establish Right to Build Zones by providing a fixed payment for each home developers complete above the community’s recent construction levels.
While it’s unclear how much municipalities would receive, the agenda proposes payments roughly equivalent to the impact fees developers pay municipalities, helping cover the costs of essential services like infrastructure and schools.
Transit-oriented development
The agenda notes that many regions underutilize land near existing transit, like train stations and bus lines, even though transit-oriented sites are often the best candidates for new housing. To encourage municipalities to allow more housing near major transit stops, the document proposes directing more federal transit grants and financing opportunities to communities that adopt pro-housing measures around transit.
The Build More Housing Near Transit Act of 2025, which proposed encouraging localities to establish by-right approval and other zoning reforms for multifamily housing near transit corridors, would have directed federal transit dollars to communities that adopt pro-housing measures. However, the bill wasn’t included in the final version of the 21st Century ROAD to Housing Act.
Leveraging federal property for housing
The federal government, including the General Services Administration (GSA) and the U.S. Postal Service, owns millions of square feet of underused real estate. A housing-focused mandate could direct federal agencies to open these sites up to housing development, potentially creating hundreds of thousands of new homes nationwide while generating government revenue.
Lowering material and regulatory costs
Rising construction costs are a central barrier to building attainable housing, with the report estimating that material inputs to residential construction have jumped 42% over the last five years. This compares with 7% growth during the prior five years.
Targeted tariff relief
In addition to inflation and supply chain shocks, the policy agenda cited certain federal policies that amplified these cost pressures:
- The Build America, Buy America Act (BABA) generally requires federally funded affordable housing projects to use U.S.-produced materials. Some estimates suggest this mandate can raise project costs by 15% to 25% in certain cases.
- Tariffs on imported steel, lumber, aluminum and equipment are estimated to add nearly $11,000 to the cost of building a single-family home.
The policy agenda proposes exempting affordable housing from Build America, Buy America requirements, as well as providing targeted tariff relief for residential construction materials.
Modernizing fragmented, prescriptive building codes
National model building codes are updated every three years, but many localities lack the capacity to fully evaluate new editions. This can result in a patchwork of different codes across jurisdictions, driving up costs and complicating operations for builders. Overly prescriptive codes can also slow adoption of innovative, cost-saving materials and methods, even when they meet equivalent safety standards.
To combat this, the document suggests that the federal government can help local governments keep building codes up to date and adopt more performance-based standards that could lower construction costs.
Targeting barriers to transporting mass timber
The report notes that there is growing interest in mass timber for mid-sized multifamily housing, as it is lighter than concrete and steel and can cut construction timelines by about 25%. However, transporting oversized mass timber components across jurisdictions is often slowed by inconsistent state and local rules for oversized loads.
The document proposed using federal incentives to encourage states to streamline and coordinate approval processes for transporting oversized mass timber loads, but did not specify what those incentives would entail.
Filling financing gaps for housing construction
The agenda tied tight credit conditions and higher interest rates to slowing housing starts, noting that builders and developers have reported tightening credit for more than four years. Financing barriers facing developers and homebuilders include longer processing times, restrictive underwriting and a lack of flexible products for projects that don’t fit conventional boxes.
The document proposed three ways to improve capital access for housing development.
Creating a federal revolving loan fund
First, it proposed that the federal government should establish a federal revolving loan fund to fill financing gaps. Some housing projects are described as too small, too complex or too unconventional for standard underwriting, even when they are financially sound. Many states and localities, such as Oregon, New York, Kansas, Hawaii, Arizona and Virginia, have already turned to revolving loan funds to address this gap, using repayments to finance new rounds of projects and stretch public dollars over time.
Modernizing FHA financing for infill development
It also proposed streamlining slow, cumbersome FHA financing for infill housing. FHA-backed construction loans can offer better terms than conventional debt but are described as too slow and administratively burdensome for many developers. The report notes the following:
- FHA multifamily construction loans can take 9–12 months to close, compared with 2–3 months for conventional financing.
- The U.S. Department of Housing and Urban Development’s (HUD) outdated technology and processes contribute to delays.
- FHA loans can trigger federal environmental review even for straightforward infill projects on previously developed urban land, adding time and cost.
To accelerate multifamily lending, the document suggested that the federal government should modernize HUD systems and underwriting, in addition to implementing new categorical exclusions for infill housing to streamline environmental reviews.
Expand federal financing options for ADUs
Accessory dwelling units (ADUs) are increasingly seen as a way to add units on existing lots without new land or large-scale projects, particularly in land-constrained states like California.
However, many homeowners can’t afford to build them because financing options are limited. Today, most ADUs are built by owners with enough cash on hand, even though evidence cited in the agenda suggests more households would build if affordable financing were available.
To combat this, the document proposed that the federal government provide federally backed second-mortgage products specifically to finance ADU construction, structured to account for the unit’s future value and rental income. Notably, it would allow borrowers to preserve their existing mortgage rate.
