The Senate passed a bipartisan housing bill on Monday aimed at addressing the nation’s housing affordability crisis by restricting large investors’ purchases of single-family homes and promoting increased housing supply. The measure, approved by a vote of 85-5, marks the first significant federal housing legislation since the 2008 financial crisis. It now moves to the House, where lawmakers are expected to pass it.

Central to the legislation is a provision that would prevent institutional investors from acquiring more than 350 single-family homes nationwide. This is intended to reduce competition with families seeking affordable housing. The bill also expands federal grant programs to support local governments in constructing new homes and eliminates an obsolete federal construction requirement known as the “chassis rule,” which mandated manufactured homes be built on a steel frame with wheels and an axle, raising costs unnecessarily.

Senate Banking Committee Chair Tim Scott (R-South Carolina) emphasized the bill’s broader goal of helping Americans achieve homeownership. “The housing bill to me is less about legislation and more about helping Americans achieve their version of the American Dream,” Scott said. He also noted that bipartisan efforts are underway to develop further housing policy initiatives.

The legislation is the result of nearly a year of negotiation and represents an unusual area of cooperation between Democrats and Republicans. Progressive Sen. Elizabeth Warren (Massachusetts) and former President Donald Trump both supported the bill, specifically backing the restriction on institutional investors. Warren described the bill as a significant step toward affirming a federal role in reducing housing costs and curbing the influence of Wall Street in the housing market.

Housing advocates have praised aspects of the bill for their potential to improve housing supply and reduce building costs. The elimination of the chassis rule could lower the price of manufactured homes by up to $10,000, industry experts say. Additionally, incentives for cities to build more housing are viewed as a positive shift toward federal involvement in local housing production.

However, some analysts remain skeptical about the bill’s overall impact on housing affordability. The Urban Institute reports that institutional investors own only about 3 percent of single-family rental homes and less than 0.5 percent of the total single-family housing market. Sharon Wilson Géno, president of the National Multifamily Housing Council, argued that restricting institutional investors will have minimal effect on housing costs and supply. “There is no one magical thing in this bill that is going to suddenly unlock the housing markets,” she said, noting the deeper issue is a significant shortage of housing inventory nationwide.

Despite differing views on its effectiveness, the act signals congressional recognition of housing affordability as a critical issue for the American electorate. A recent poll indicated strong public support for limiting institutional purchases of single-family homes, with 71 percent of registered voters backing such measures. The bill reflects a growing bipartisan consensus on the need for federal action to address housing challenges.