Follow the Yellow Brick ROAD Act

By David J. Petersen

The federal 21^st Century Renewing Opportunity in the American Dream (ROAD) to Housing Act (Public Law 119-101) became law on July 11, 2026, after it passed Congress and the President did not sign or veto it within the applicable time limit. The Act’s stated purpose is to increase housing supply and affordability nationwide by reducing regulatory and financing barriers. It is not an appropriations bill and contains no new money for housing. Instead, it changes rules and procedures. Whether it actually produces new housing will depend heavily on future implementation and appropriations.

Still, it’s worth considering how the bill might affect housing availability and affordability, particularly in the Pacific Northwest. Since a large part of the Act focuses on streamlining regulations, housing financed with federal money is most likely to see an actual reduction in administrative barriers over time. Following the streamlining theme, the ROAD Act also makes changes meant to streamline the processes in other federal programs that touch on lower-cost housing, like Community Development Block Grants, disaster aid, rural housing, vouchers and public housing. As in many states, these federal programs contribute significantly to the Oregon and Washington housing markets.

The Act also incentivizes local governments to make zoning changes to spur denser development and convert unused commercial space to residential. Oregon and Washington are already out in front of these trends, so hopefully local housing agencies can take advantage of new federal opportunities.

Modular building is another beneficiary of the Act’s financing reforms. As opposed to a custom-built house that is constructed on-site, modular housing is built in modules off-site in factories then shipped to and assembled at the site. If custom changes to the modular offerings are kept at a minimum, this can result in reduced costs. However, lenders (mostly federal lenders like HUD and FHA) have been resistant to reform their underwriting and draw procedures to fit modular housing, which can require more funds up front. The ROAD Act seeks to make funding more flexible to fit modular projects, while also expanding financing options for similar housing trends like ADUs, affordable housing, and multi-family housing.

Another interesting provision in the ROAD Act is a ban on certain large institutional investors from acquiring additional single-family homes for 15 years beginning in 2027. This is an attempt to address the perceived housing scarcity that arises when investors acquire housing for speculation or business opportunities like short-term rentals, rather than providing permanent housing.

As with many federal laws that don’t come with appropriations, it is hard to be too enthusiastic about the ROAD Act’s potential to achieve sweeping improvements. But the Act does conglomerate a number of reforms which collectively may promote gradual improvement. And importantly, the Act reflects something increasingly rare in our country lately: bipartisan agreement. With passage of the ROAD Act, both parties have shown that housing is an important issue that needs encouragement and reform.

For a more in-depth and independent analysis of what the ROAD Act contains, this report is instructive.