Moody’s review of the American Housing and Economic Mobility Act of 2024 asserts that the proposed expenditure of just over $500 billion “would help address [the] mounting housing crisis.” Specifically, Moody’s claims that:
“[a]ffordable rents will be approximately 10% lower [in 10 years] than they are today, or about $140 per month in today’s dollars,”
“Over the 10-year budget horizon through 2034, affordable housing production increases by 273,000 units per annum on average.”
“This would more than fill the current shortfall in annual affordable housing construction and would largely quell the affordable housing crisis by the mid-2030s.”
Moody’s projections suffer from three fundamental flaws that call into question the reliability of these conclusions. Below, we will outline a proven market-based alternative that can increase the supply of naturally occurring affordable housing, reduce housing costs, and avoid the need to spend $500 billion on approaches that have historically failed to deliver on their promises.