Kamala Harris has an ambitious plan to build 3 million new homes. She'll have to get through Congress and local NIMBYs first.

• Kamala Harris unveiled a housing plan that includes building three million homes in four years.
• Her plan includes tax incentives for builders to construct small and affordable homes.

Democratic presidential nominee Kamala Harris unveiled some of her major economic priorities in a speech in North Carolina last week.

Central to her agenda is a plan to make housing more affordable — an issue that's become increasingly urgent for millions of Americans amid a housing supply shortage and skyrocketing prices. Part of Harris' plan involves spurring the construction of lots of new housing through policy changes and subsidies. But barriers to new construction abound — from an often-gridlocked Congress to state and local leaders and communities.

Harris has pledged to build three million homes across the country during her first term as president. She wants to offer tax incentives for home builders to construct starter homes — smaller, more affordable units — for first-time homebuyers. She would also expand a current tax credit for businesses that build affordable rental housing. And Harris says she would double the Biden administration's $20 billion housing innovation fund intended to support local governments and developers looking for new ways of building affordable housing. Last, the campaign called for a reduction in "red tape and needless bureaucracy" that stalls new construction.

These three million new homes would be in addition to the homes developers would otherwise construct, The Wall Street Journal reported.

Jenny Schuetz, an expert in urban economics and housing policy at the Brookings Institute, told Business Insider that while a goal for new home construction is helpful, it's not necessarily an accurate prediction.

"There's no way that the government can guarantee X number of homes are going to get built," Schuetz said. But, she added, "putting the number out there and then marking progress is actually quite helpful."

Aside from incentivizing new housing construction, Harris' plan includes a proposal to crack down on investors buying up homes in bulk and landlords from using rent-setting algorithms "to collude with each other and jack up rents."

The campaign also proposed expanding the Biden administration's assistance for first-time homebuyers, proposing an average of $25,000 in downpayment support for first-time buyers.

A spokesperson for the Harris campaign didn't immediately respond to a request for comment.

Harris' plan focuses more on boosting the supply of housing than the current administration has. The federal government has traditionally focused its housing policy on demand-side subsidies like housing vouchers. Schuetz and other housing experts are glad to see this shift, noting that a housing shortage is the central cause of the affordability crisis.

There is some bipartisan agreement on housing policy. At the state level, Republican lawmakers have successfully cut red tape to spur home construction. But boosting federal funding and shifting strategies won't be easy in a bitterly divided Capitol.

"Acknowledging that this is a problem isn't the same thing as saying we've got a magic wand that will allow us to solve it," Schuetz said.

Barriers to action

Most of Harris' housing plan would require support — and lots of new funding — from Congress. The WSJ reported that the tax credits for starter homes and affordable housing construction would cost about $80 billion combined. And getting Congress to agree on anything is a serious challenge.

Andy Winkler, director of housing and infrastructure projects at the Bipartisan Policy Center, noted that while there isn't much Republican support for demand-side housing policies like Harris' downpayment assistance program, some of the supply-side measures could get bipartisan backing.

He's most optimistic that expanding the Low Income Housing Tax Credit and other supply-side, tax-based policies could pass Congress as it debates tax reform in 2025. But he's skeptical the reforms Harris could get through would result in three million new homes in four years — a goal he called "pretty ambitious."

"I have trouble foreseeing a sweep election, so if either the House or the Senate has a Republican majority, I think the tax policies are where you could see the most potential," Winkler said.

On top of getting Congress on board, a Harris administration would need states and municipalities to reform many layers of land-use regulations and other housing-related policies to make way for new construction. Many of the policies that restrict housing construction — including land-use laws like zoning — are controlled by local and state governments, meaning the federal government's influence over those policies is limited.

The White House and Congress can use federal subsidies to incentivize local officials to loosen regulations and otherwise spur construction, but they can't force this action. And there is often lots of local opposition that significantly slows down or halts all kinds of development.

While Republicans in Congress might be interested in cutting red tape at the local and state levels, the devil's in the details, Winkler said.

"It's really difficult from the federal level to incentivize those behaviors," he said.