Congress just enacted one of the most significant pieces of federal housing legislation in decades.

The 21st Century ROAD to Housing Act became federal law on July 11, 2026. Its stated purpose is fairly simple: America needs more housing, and the federal government wants to remove some of the obstacles that make housing difficult and expensive to build.

The new law contains dozens of provisions dealing with housing construction, manufactured homes, financing, environmental reviews, institutional investors, local housing policy and even the appraisal profession itself.

For homeowners and property owners in West Michigan, however, the important question is not what is buried inside hundreds of pages of legislation.

The important question is:

Could any of this eventually affect the value or potential use of my property?

The answer is yes, although probably not overnight.

The Basic Idea: America Needs More Housing

The premise behind the ROAD to Housing Act is that housing affordability is largely a supply problem.

When the number of households looking for housing grows faster than the number of homes being built, competition increases. Prices and rents tend to rise along with it.

Congress responded by focusing much of the legislation on making it easier and less expensive to produce housing.

The law streamlines certain federal environmental reviews, encourages local governments to increase housing production, expands opportunities for manufactured and modular housing, modifies several federal housing programs and attempts to make financing new housing easier.

One important distinction needs to be made.

The federal government did not eliminate local zoning.

Cities, townships and villages still maintain significant control over what can be constructed within their communities. The federal legislation specifically stops short of overriding state and local zoning decisions. Instead, it uses incentives, funding programs and federal policy to encourage communities to allow more housing.

That distinction is particularly important when discussing property values.

Why Zoning Changes Matter to Property Owners

One of the most important concepts in real estate appraisal is something called Highest and Best Use.

An appraiser is not simply asking what currently exists on a property.

We also have to consider what the property could reasonably and legally be used for.

Generally speaking, Highest and Best Use considers whether a potential property use is physically possible, legally permissible, financially feasible and produces the greatest value.

That is where housing policy can eventually become very important.

Imagine a property containing an older single family home on a large parcel.

If zoning only permits one residence, the market will generally evaluate the property as a single family residential site.

Now imagine the municipality changes its ordinance and allows four residential units, an accessory dwelling unit, a duplex or a small apartment building on that same property.

The house did not change.

The land did.

And its development potential may have changed substantially.

The background analysis supplied for this article correctly identifies this as one of the areas appraisers will need to watch closely as housing policy evolves.

Accessory Dwelling Units Could Become More Important

One area worth watching closely in Michigan is the continued expansion of accessory dwelling units, commonly called ADUs.

An ADU might be a smaller second dwelling located within a home, over a garage or elsewhere on a residential property.

The ROAD to Housing Act includes provisions intended to improve financing opportunities for ADUs and encourages local governments to look at regulations that restrict additional housing production.

That does not mean every homeowner in Grand Rapids, Ada, Rockford or Hudsonville can suddenly build another house in the backyard.

Local zoning still matters.

But the direction of housing policy is clear.

Communities across the country are being encouraged to find ways to accommodate more housing on existing land.

For property owners, that means zoning and development rights may become increasingly important components of value.

Manufactured Housing Is Changing Too

The legislation also makes a significant change involving manufactured housing.

Historically, the federal definition of manufactured housing required the home to be constructed on a permanent chassis.

The new law removes that permanent chassis requirement and directs federal agencies to examine additional barriers to financing modular housing.

That may sound like an obscure technical change.

It's not!

Factory built construction has the potential to lower construction costs, reduce construction time and create housing forms that look increasingly similar to traditionally constructed homes.

Over time, that could create additional housing options in both urban and rural Michigan markets.

Appraisers will have to pay attention to how buyers react to these properties rather than automatically relying on older assumptions regarding manufactured or modular housing.

Market acceptance matters more than labels.

The Law Also Targets Large Institutional Buyers

Another provision receiving considerable attention involves large institutional investors purchasing single family homes.

The law restricts certain institutional investors that already control large portfolios of single family homes from continuing to purchase additional properties.

The intent is to reduce competition between large investment companies and individual homebuyers.

Whether that provision meaningfully changes home prices nationally remains to be seen.

Real estate is local.

Institutional ownership represents a much larger percentage of the housing stock in some markets than others. The effect in West Michigan could therefore look very different from the effect in Sun Belt markets where institutional ownership became much more prevalent following the Great Recession.

Appraisers Are Actually Included in the New Law

There is another part of the legislation that has received far less mainstream attention.

The law contains significant changes directly affecting the appraisal profession.

Among other provisions, the legislation strengthens federal appraisal oversight, changes pathways into the appraisal profession, expands eligibility for certain appraisers performing FHA work and addresses standards surrounding Reconsiderations of Value and second appraisals.

It also directs the Government Accountability Office to study the feasibility of creating a publicly accessible appraisal database.

That last provision could become particularly interesting.

Real estate appraisals contain an enormous amount of information about properties, markets, condition, quality and comparable sales. Much of that information currently remains fragmented among lenders, government agencies, appraisal companies and individual reports.

A properly constructed national appraisal database could eventually create far greater transparency.

It could also raise legitimate questions involving homeowner privacy, data ownership and the proper interpretation of appraisal information.

The law currently requires a study. It does not create the database itself.

Will This Cause Home Prices to Fall?

Probably not in the way some people imagine.

Increasing housing supply can reduce upward pressure on prices, but housing markets do not change instantly.

Land has to be rezoned.

Developers have to identify opportunities.

Financing has to make sense.

Infrastructure has to exist.

Projects have to be approved.

Homes have to be constructed.

And buyers still have to want what is being built.

Mortgage rates, construction costs, employment, population growth and household formation will continue to influence housing values just as much as federal legislation.

The ROAD to Housing Act should therefore be viewed less as an immediate reset of home prices and more as a change in the rules surrounding future housing production.

What West Michigan Property Owners Should Watch

For homeowners and real estate investors in Grand Rapids and throughout West Michigan, the biggest changes may ultimately happen much closer to home.

Pay attention to zoning proposals in your city or township.

Watch for changes allowing duplexes, ADUs, smaller lots, mixed use projects and higher residential density.

Those changes can affect more than the number of houses being built.

They can affect the potential use of existing properties.

And whenever the potential use of real estate changes, value can change with it.

A property that appears to be nothing more than an older house today could eventually become valuable because of the land beneath it and what that land is allowed to become.

That is exactly why competent real estate appraisal involves more than finding three comparable sales and calculating an average price per square foot.

The appraiser has to understand the market, the property, the applicable regulations and the alternatives available to buyers.

Housing policy is changing.

The real estate market will eventually respond.

And our job as appraisers is to recognize when those changes actually begin showing up in what buyers are willing to pay.

Real Value Group has provided residential real estate appraisal and consulting services throughout West Michigan since 2001. We serve homeowners, attorneys, Realtors, financial professionals and other clients throughout Kent, Ottawa, Allegan, Barry and Ionia Counties.