The U.S. House of Representatives overwhelmingly passed legislation this week that is predicted to finance hundreds of thousands of affordable housing units, helping New York City and state housing agencies struggling to meet demand.

The $78 billion Tax Relief for American Families and Workers Act of 2024 that includes key measures to boost the Low-Income Housing Tax Credit (LIHTC) program now moves to the U.S. Senate for approval.

If approved, the legislative package promises to spur housing development. It includes restoration of a 12.5% increase in annual 9% LIHTC allocation for 2024 and 2025 and a reduction, from 50% to 30%, of the amount of private bond financing required to access the 4% housing credit.

Emily Cadik, CEO of the Affordable Housing Tax Credit Coalition, posted the following on her LinkedIn page: “The low-income housing tax credit provisions in the Tax Relief for American Families and Workers Act of 2024 would finance over 200,000 affordable homes that are shovel ready, and we encourage the Senate to move quickly to advance this bipartisan legislation.”

The nation’s housing shortage is especially acute in New York. In New York City, half the working households do not earn enough to meet the minimal cost of living in the city.

Rachel Fee, executive director of the New York Housing Conference, told Affordable Housing Finance the package is “the biggest expansion of federal resources to support affordable housing in decades,” noting that New York state alone is estimated to add up to 19,000 new rental homes and over 29,000 construction jobs that can generate $3.3 billion in wages and business income as a result of the program improvements.