Overview of the Bipartisan Housing Bill

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You know, it sends a message to local leaders that you want to streamline regulations and make it easier to build So The real estate industry broadly sees this bill as a victory. It's Wednesday, june twenty fourth I'm Alex Osaleef for the Wall Street Journal This is the PM edition of What's News, The top headlines and business stories that move the world today Starting off this evening with a look at markets. Major US indexes ended the day mixed, with the do rising aboutzero four percent, but tech stocks struggle to shake off fears of an AI bubble. One of the day's biggest losers was Cerebrus, the chip maker that went public in May. Its shares fell almost twenty percent after the company warned it expects to keep operating at a loss. another reminder of the heavy cost of the AI buildout. The NASDAq dropped zero point four percent today after declining four percent over the past two days. and the S and P five hundred fell zero point one percent Meanwhile, oil prices dropped near pre war levels. Brent crude futures fell four point three percent to seventy three dollars seventy four cents a barrel And Bitcoin dipped below sixty thousand this afternoon, its lowest intraday level since earlier this month, when Bitcoin accumulation firm strrategy said it had unloaded a portion of its holdings In earnings, US memory chip maker Micron reported more than forty one billion dollars in revenue for its latest quarter a more than four fold increase from a year before and beating analyst expectations in virtually every financial metric watched closely by investors. The company forecasted that rapid growth will continue due to near insatiable demand for its memory chips, a key component in AI technology. But its stock has also been hit by investor worries about runaway tech valuations, high AI capital spending, and possible interest rate increases from the Federal Reserve. After getting hit hard yesterday by the broader tech selloff, Micron shares were up nearly fourteen percent in after hours trading. Separately, South Korean chip maker S K Heinenix plans to raise more than twenty nine billion dollars through a US listing The deal would be one of the biggest share sales in company history, comparable to Saudi A Ramco's twenty nineteen IPO The company is looking to tap foreign investors to fund its expansion plans as the AI boom fuels a rush for advanced chips. SK Heynx expects trading to begin july tenth, adding to a blockbuster year for equity raises And new government data shows that US new home sales fell in May to five hundred eighty thousand. That's down from six hundred twenty six thousand in April and worse than economists had expected Today on Capitol Hill, President Trump had a lunch meeting with Senate Republicans about their legislative agenda The face off has been in the works for some time. Last week, President Trump threw a wrench in plans to confirm a new intelligence chief and renew a key spying law until Congress passes a contentious voter ID bill, the Save America Act Ahead of today's lunch, Trump doubled down, canceling plans to sign a bipartisan housing bill into law, again until Congress took action on that legislation. For more on the meeting and where lawmakers go from here, Rorter Marianne Levine joins me now from the Capitol. Berriian, what is in this Save America Act and why is it so controversial among lawmakers? So the Save America Act is a top priority for President Trump. It would basically impose new voter eligibility rules, including proof of citizenship. And this is something that the president really wants Senate Republicans to pass, but there basically are not enough votes to get rid of the filibuster and pass this legislation So it seems like based on some of the things that have happened just leading up to this meeting today, the vibe among Republicans was like pretty tense What was the outcome from this meeting? They really did not talk all that much about the Sate of America Act. And the president apparently got into a very contentious disagreement with Senator Bill Cassidy, who voted to convict him during the president's second impeachment. He and Cassidy have had a very tense relationship, but its like a The focus of the meeting really was not about this bill. It was really about the war in Iran. And where does Iran fit into this? The war in Iran has been a huge political question in the Senate, especially in terms of the impact the war has had on the midtererms in terms of gas prices and this broader question of affordability. The war in Iran was also very much on the president's mind because the Senate yesterday passed a war powers resolution that sought to restrict the President's authority on the war The president was unhappy about with that vote and that informed some of his own anger today. Where do lawmakers go from here? Will they be pushing Trump for more concessions It's hard to say, I mean, the president has coming in in a pre contentious moment in his relationship with Senate Republicans. This is, I think, an encapsulation of broader tension that's been growing between the president and the Senate Republican caucus that we've seen and that's kind of spilling out in different ways, including this pressure to pass the SA act. And so there's been this frustration asking why the president is so focused on this bill that has no chance of passing. Marianne Levine, joining me from the Capitol. Thank you so much for the rundown. Thanks for having me. Coming up, how a new federal bill seeks to address the housing crisis. That's after to the break Planning for retirement and all the things that go with it can be stressful That's why Fisher Investments partners with you to understand your unique goals and needs so that they can build a tailored plan that helps you achieve a comfortable retirement. Whether you need help with financial planning, estate planning, tax optimization, or social security, Fisher has specialists to help Fisher investments. Now that's clearly different wealth management Learn more at fisherinvestments. comot invvesting in securities involves the risk of loss For months, lawmakers on Capitol Hill have gone back and forth over a bill to encourage new housing development The twenty first century Road to Housing Act would be one of the biggest changes to federal housing policy in years And this week, it finally passed through both chambers of Congress with overwhelming majorities, and was set to be signed into law by President Trump today. Until, as we discussed earlier in the show, he abruptly canceled that plan As the bill sits in limbo, some say its passage could speed up construction of much needed new housing across the country. I'm joined now by Rebecca Pachoto, who covers the residential real estate market for the journal Rebecca walk us through what is in this legislation So this final bill has More than fifty provisions aimed at making it easier to build more housing and one provision aimed at trying to keep private equity out of the housing market. It's been nearly a year of back and forth, but the two chambers have settled on has all of the same bills that the House passed in May adds back some of the earlier Senate provisions that the House had removed. So for example, this Build now A, which is a provision that essentially ties federal grant funding that a city gets to the amount of housing they produce. So the more housing a city produces, the more grant funding they could be eligible for This is one of the kind of carrot and stick approaches that the two chambers settled on to try to incentivize local governments to build more. Let's go back to the beginning with these bills Who introduced the bill? What was the intention behind it? The first version of this bill came out in august twenty twenty five It was introduced by senators Elizabeth Warren and Tim Scott, a Democrat and a Republican. At that time, it really was just a pretty uncontroversial package of a bunch of small housing bills that Everyone largely agreed was a step in the right direction. No one bill in the package was going to do enough to move the needle, but together, It was seen as Congress's largest move on housing in decades, and it had this massive bipartisan support It included everything from speeding up permitting processes, cutting red tape around environmental reviews, making it easier to build manufactured housing encouraging local municipalities to ease their zoning laws, a bunch of small tweaks that in tandem are seen as crucial to increase housing supply. If you ask real estate leaders The federal government has a very limited ability to actually enact real change what housing gets built where is often determined on the local level But the sort of symbol that The federal government was moving towards encouraging more housing supply. That was seen as enough to have the momentum and support to pass it Okay, so these two lawmakers introduce it. It's bipartisan. thenen what happens? When Trump at the beginning of this year, announced his executive order to ban Wall Street housing investors, he demanded that Congress codify that ban into law, and the White House saw the Senate's Rad to Housing bill as a very convenient vehicle to get that done And now this manan has created this back and forth that I don't think lawmakers had initially intended when they first introduced the bell. For those of us who haven't been following the bill up to this point, what is the investor ban? and why is this something that President Trump cares about Basically, Trump wants to forbid large institutional investors from buying up single family homes and essentially turning them into investments, renting them out, et ccetera hisis theory is that there are these large Wall Street companies that are basically stealing the housing supply from American families who otherwise would have been able to pursue the American dream of home ownership. So the ideas is to eliminate these behemoth investors from competing with individual investors who pay all cash or offer the higher bids that these firms can It's been controversial because there's this general sense that This is a largely political move and economists will maintain that The amount of housing that Wall Street investors actually own is relatively low single digits across the country that is felt differently in different places. you know, Phoenix, Atlanta, you can have investor owned housing stock up to like twenty percent. So this polled really well But investors are often kind of an important financing avenue for home builders to offload surplus housing stock. It allows them to build more homes The primary worry of the real estate industry was that this investor band would send a signal to the lenders and financing partners that they typically go to the government is trying to suppress the number of single family rentals that exist in America So the real estate industry has been lobbying around this bill. They've had concerns about it. Where does the industry stand on it now The bill is generally something that the real estate industry likes. You know it sends a message to local leaders that you want to streamline regulations and make it easier to build. The real estate industry broadly sees this bill as a victory. The investor band piece is sort of a more sour pill to swallow, but at this point, I think they've negotiated it down to a point where they feel okay. That was residential real estate reporter, Rebecca Pachoto For more from her and on housing legislation, check out today's episode of Your Money Briefing. Tomorrow, our housing series continues on the PM episode of What's News, looking at what happens when people decide that homeownership is a part of the American dream that's no longer for them We'll be talking about the Rnter revolution If you have any questions about that, affordability, or the legislation we discussed today, then send us a voice memo to wNpod d at wsj dot com or leave a voicemail with your name and location at two one two four one six four three two eight. Or if you're a listener on Spotify, leave us a comment with your thoughts We'll be looking to answer your most burning questions with journal real Eestate editor Craig Carmen at the end of the week And that's what's news for this Wednesday afternoon. Today's show is produced by Anthony Bansy and Danny Lewis with supervising producer Katie Ferguson. I'm Alex Osilov for the Wall Street Journal. We'll be back with the news show tomorrow morning. 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