Federal financing of and spending on real estate impacts millions of Americans on every street, in every neighborhood, town and rural community in the country. From loan guarantees to commercial tax credits, these programs help those most in need pay their rent, help families purchase their first home, and provide financing for commercial development. The federal government impacts where and how homes and even whole neighborhoods are built in the United States.

Federal Involvement in Real Estate: A call for examination surveys this spending, which encompasses approximately $450 billion each year. Through a combination of direct spending and commitments, this funding supports loans and loan guarantees, grants, and tax credits.

This spending has an enormous impact on the U.S. real estate market. Though usually viewed as a “free” market, the U.S. real estate sector is heavily influenced by direct and indirect government intervention. Taken as a whole, these expenditures and investments impact where real estate is developed and what kind of product is built.

Even a cursory analysis reveals this impact is uneven. For example, small multifamily buildings are less likely to receive financing, despite the fact that most renters in the United States live in these smaller buildings. Viewed as whole, federal funds are not targeted to those most in need, are not targeted to strengthen existing communities and are not targeted to places where people have economic opportunities.