The Neighborhood Homes Coalition Urges Senate Leadership to Include Widely Supported Legislation for Homeownership in Reconciliation Package

Washington, DC (June 17, 2025) — The Neighborhood Homes Coalition, a group of 48 national organizations, including housing and community development nonprofits, financial institutions, and related trade associations, on Tuesday sent a letter to Senate leadership to urge inclusion of the Neighborhood Homes Investment Act in the final reconciliation package, following the release of the Senate version of the reconciliation bill. 

The Neighborhood Homes Investment Act is widely supported legislation that would create a new tax incentive to build and preserve more than 500,000 affordable, single-family homes for homeownership over ten years in under-resourced communities. 

The letter reads, in part, “The Neighborhood Homes Investment Act is the most widely supported homeownership supply bill in Congress and is essential to the President’s commitment to deliver price relief to Americans by lowering the cost of housing and increasing housing supply.”

The letter to Senate Majority Leader Thune and Chairman Crapo can be found here and below:

Dear Leader Thune and Chairman Crapo,

All across the country, from rural communities to the largest cities, we face a critical shortage of affordable homes for homeownership. With the One Big Beautiful Bill Act, Congress has the opportunity to begin to address this housing shortage and expand opportunities for homeownership. We urge you to use this opportunity to address the economic needs of millions of American families by including a tax provision to support the creation of affordable homes for homeowners around the country.

The Neighborhood Homes Investment Act (S.1686, H.R. 2854) is the most widely supported homeownership supply bill in Congress and is essential to the President’s commitment to deliver price relief to Americans by lowering the cost of housing and increasing housing supply. Introduced by Senator Todd Young (R-IN) and Representative Mike Kelly (R-PA), the legislation would create a new tax incentive to build and preserve more than 500,000 affordable, single-family homes for homeownership over ten years in under-resourced communities.

Under the proposed program, federal tax credits would help close the gap between the cost of constructing or rehabilitating a home and its market value. These credits would be allocated by formula to state housing finance agencies and then distributed through a competitive process to project sponsors—such as developers, local governments, or financial institutions. Project sponsors would have five years to complete homes, which must be sold at affordable prices, generally capped at four times the area’s median family income.

Over ten years, the Neighborhood Homes Investment Act is projected to support the construction or rehabilitation of 500,000 homes, generate $151 billion in development activity, and create 1.1 million jobs. It targets disinvested urban neighborhoods, rural areas, and communities hit by natural disasters or economic decline. Eligible families earning up to 140% of area median income (AMI) can purchase homes, while those earning up to 100% of AMI can access rehab loans—bringing stability and opportunity to underserved areas across the country.

We were pleased to see that the House and Senate included provisions from the Affordable Housing Credit Improvement Act to expand the supply of affordable homes for renters. We now urge Congress to also address the needs of aspiring and existing homeowners.

We appreciate your leadership and attention to this critical issue. If you have any questions, please do not hesitate to contact Matt Josephs, Senior Vice President of Policy at LISC (mjosephs@lisc.org), or Sarah Brundage, President and CEO of the National Association of Affordable Housing Lenders (sbrundage@naahl.org). Additional information and resources on the Neighborhood Homes Investment Act can be found on our website at www.neighborhoodhomesinvestmentact.org.

Sincerely,

The Neighborhood Homes Coalition