HOME Investment Partnerships Reauthorization and Improvement Act of 2025

The HOME Investment Partnerships Reauthorization and Improvement Act of 2025 (S.948) was introduced in the Senate on March 11, 2025, and subsequently referred to the Senate Committee on Banking, Housing, and Urban Affairs. This bill, sponsored by Senator Cortez Masto (D-NV) and 12 cosponsors, seeks to reauthorize the HOME Investment Partnerships Program, authorizing $5 billion for fiscal year 2025, with incremental increases to over $6 billion by fiscal year 2029. A companion bill, H.R.2031, has also been introduced in the House, indicating bipartisan and bicameral interest in the program. This bill authorizes significant funding for affordable housing initiatives, but it is crucial to note that authorization does not equate to appropriation. The authorized amounts represent spending ceilings, and actual funding will depend on subsequent appropriations bills. The funds, if appropriated, would flow through the HOME Investment Partnerships Program, which provides grants to states and local governments to create affordable housing for low-income households. This mechanism typically benefits homebuilders and building materials companies indirectly, as increased affordable housing projects drive demand for construction services and supplies. The bill also includes provisions for increased program administration resources, modifications to qualification thresholds, and reforms related to program administration and rules, such as amendments to affordable housing qualifications and reforms of homeownership resale restrictions. Structural beneficiaries of this legislation, should it pass and be funded, would include homebuilders like Lennar Corporation ($LEN), D.R. Horton, Inc. ($DHI), KB Home ($KBH), Toll Brothers, Inc. ($TOL), NVR, Inc. ($NVR), PulteGroup, Inc. ($PHM), Meritage Homes Corporation ($MTH), Green Brick Partners, Inc. ($GRBK), and Hovnanian Enterprises, Inc. ($HOV). These companies would likely see increased demand for their services and products as affordable housing projects are initiated. Building materials suppliers would also benefit. Federated Hermes, Inc. ($FHI) is not directly related to homebuilding or affordable housing construction, and its inclusion in the provided market data is noted but not directly impacted by this bill. Despite the potential long-term tailwind from this bill, recent market performance for homebuilders has been negative over the last 30 days. All listed homebuilder stocks, including $LEN, $DHI, $KBH, $TOL, $NVR, $PHM, $MTH, $GRBK, and $HOV, have experienced declines in their 30-day change. However, over the last 7 days, most of these stocks have shown positive movement, with $LEN up +4.35%, $DHI up +6.93%, $KBH up +1.64%, $TOL up +5.63%, $NVR up +3.33%, $PHM up +5.37%, $MTH up +5.01%, $GRBK up +5.59%, and $HOV up +5.19%. The bill is in its early stages, having only been referred to committee. Significant legislative steps, including committee hearings, potential amendments, and votes in both the Senate and House, remain before it could become law.