Rep. Alexandria Ocasio-Cortez and Sen. Tina Smith have introduced the HOMES Act, a significant initiative aimed at increasing the availability of affordable housing in the U.S.

The HOMES Act proposes the creation of a new federal housing development authority tasked with building and rehabilitating over a million affordable homes.

Under this legislation, approximately 40% of the homes would be designated for extremely low-income residents, 30% for low-income households, and 30% for middle-income households, with rents capped at 25% of tenant income.

Social housing, as outlined in the HOMES Act, would encompass various forms such as public housing, community land trusts, and cooperatives.

Ocasio-Cortez and Smith drew inspiration from successful social housing models in Vienna and other European and Latin American systems.

This proposal is part of a broader progressive movement for social housing across the U.S., with similar initiatives being explored in states like New York and California.

The housing proposal emerges during a critical election period, where various presidential candidates, including Vice President Kamala Harris and former President Donald Trump, are presenting differing housing strategies.

Funding for the housing initiative is expected to come from a combination of congressional spending and Treasury-backed loans to ensure financial stability.

The current national rental vacancy rate is at 6.6%, underscoring the ongoing housing crisis in the country.

The HOMES Act contrasts with historical federal funding approaches that have often prioritized a for-profit market, neglecting the needs of lower-income Americans.

Of the 1.25 million homes targeted by the HOMES Act, half would be newly constructed while the other half would be acquired and redeveloped from private owners.

Ocasio-Cortez emphasized the importance of considering who builds new housing, rather than merely focusing on the need for housing itself.