H.R. 2038: American Housing and Economic Mobility Act of 2025

The American Housing and Economic Mobility Act of 2025 aims to improve housing affordability and promote equitable access to housing through several key measures:

Housing Affordability Initiatives

The bill seeks to enhance housing affordability by providing local innovation grants aimed at developing unique approaches to create and maintain affordable housing. Additionally, it allocates funding for infrastructure improvements that support housing initiatives, helping to build the necessary facilities and services around new and existing housing developments.

Non-Discrimination Measures

To combat discrimination in housing, the legislation proposes comprehensive anti-discrimination measures that address barriers faced by marginalized groups. These measures are designed to ensure equitable access to housing for all individuals, regardless of their background.

Community Engagement and Financial Assessment

The bill requires federal financial supervisory agencies to conduct periodic assessments of financial institutions regarding their response to the credit needs of low and moderate-income communities. Institutions must engage with community members and establish advisory committees to better understand and address these needs. Failure to comply with these requirements could result in penalties for institutions demonstrating poor performance over time.

Auction Process for Communities

In situations where housing auctions occur, the legislation allows community partners to participate in the bidding process. If a community partner does not win the initial bid, they are permitted to make a final higher bid, encouraging local investment in housing.

Amendments to Housing Acts

This bill introduces amendments to existing legislation such as the Home Owners' Loan Act and the Federal Credit Union Act. These changes include:

• Improving credit union services in underserved areas
• Adjusting caps on public welfare investments
• Expanding eligibility for housing loans to descendants of veterans
• Enhancing rights and protections under the Fair Housing Act

Trust Taxation Reforms

The bill also proposes reforms related to trust taxation. Key changes include:

• Elimination of generation-skipping tax exemptions for transfers to individuals who do not meet specific exemptions
• Stricter conditions regarding discounts for nonbusiness assets
• Introduction of a surcharge on high-income estates
• Simplification of gift tax exclusions

These tax provisions aim to create a more equitable tax system and help fund the initiatives outlined in the bill.

Effective Dates

The bill also specifies several effective dates for the various amendments, ensuring that changes are rolled out in a timely manner to meet immediate needs.

Relevant Companies

• KB Home (KBH) - As a homebuilder, KB Home could be impacted by changes in housing affordability and related infrastructure investments that increase demand for homes.
• PulteGroup (PHM) - Similar to KB Home, PulteGroup may benefit from enhanced housing initiatives and increased access for low and moderate-income families.
• D.R. Horton (DHI) - As one of the largest homebuilders, D.R. Horton could see significant effects from modifications in housing regulations and funding for housing affordability.