Would a President Warren be the cure for our country’s increasingly messed up housing market?

Sen. Elizabeth Warren has finally made official what anyone with half a brain has long suspected – she’s eyeing a run for the White House.

Warren’s presidential ambitions may be getting all the ink right now. But here’s what you probably have not read much about: The former Harvard Law professor and bankruptcy expert recently unveiled a sweeping plan to tackle one of our nation’s most serious problems, the dire shortage of reasonably priced housing.

The timing of the proposal is hardly coincidental, given Warren’s presidential aspirations, but our senior senator’s recently unveiled American Housing and Economic Mobility Act is worth a serious look.

Warren’s $500 billion-plus plan to make housing affordable again calls for a major ramp up in spending on desperately needed new apartments and homes affordable to middle and lower-income families.

It is a proposal that brings to mind Warren’s past life pushing for reform of our country’s punitive bankruptcy laws, as well as her classic take on middle-class financial woes, “The Two Income Trap.”

But Warren wants to do more than just spend money. Her proposal also takes aim at the snob zoning that has stymied the construction of so much desperately housing across the country. Warren wants to put aside $10 billion in federal grant money for which states can compete by reforming their local zoning rules to make way for new apartments and other housing.

I’ve been skeptical of state efforts in Massachusetts to entice NIMBY suburbs into opening their doors to new housing, mainly because the small money involved hasn’t been enough to prompt most communities to act.

But Warren’s proposal takes a page from the Obama Administration’s largely successful education reform initiative, Race to the Top, which used grant money as a way of getting 46 states to put life caps on charter schools and revamp teacher evaluations.

And Warren’s proposal would put more than twice the money up for grabs, $10 billion compared to the $4 billion doled out by the Race to the Top program.

The leader of the Democratic Party’s progressive wing would also pump hundreds of millions of dollars into federal programs and initiatives aimed at spurring the construction of affordable housing.

Scott Van Voorhis

Angering the Electorate

The additional money would spur the construction of more than 3 million new affordable apartments and homes over a 10-year period, noted Mark Zandi, Moody’s chief economist, in a recent report that gave a thumbs up to Warren’s grand housing plan. “The nation is struggling with a severe shortage of affordable housing,” Zandi wrote in an introduction to the report. “Homebuilders have recently begun to increase the production of more affordable homes, but the gap between demand and supply is large and there are significant constraints on builders.”

Warren’s bill would also offer down-payment assistance, needed now more than ever. We’ve had years of escalating prices and now interest rates are headed up again, increasing the cost of borrowing.

A big focus of the down-payment program would be neighborhoods around the country that suffered from discrimination and redlining by banks and other institutions.

It would be a little bit of a stretch to nominate Warren for the Kennedy clan’s annual Profile in Courage Award. But by tackling housing head-on, she’s taking on an issue most politicians do their shameful best to dodge, despite the toll of high housing prices and rents on middle and lower-income families across the country.

You see, there’s not much political gain – and a great deal of risk – when it comes housing issues, especially the onerous and discriminatory zoning rules that have stymied new construction in towns, cities and suburbs across the country.

Elected officials generally shy away from pushing zoning reform because it risks alienating NIMBY voters who are angry about various housing proposals.

NIMBYies can be found on both sides of the political aisle, including the classic limousine liberal in an upscale suburb who bemoans income inequality yet opposes new apartments out of fear the new project will damage the community’s “character.”

With an axe to grind, housing opponents are generally better motivated to express their discontent at the ballot box than the majority of voters who aren’t likely to see an immediate payback from the loosening up of arcane zoning rules.

But Warren’s decision to offer up a real housing plan instead of just more platitudes may also be a sign that the political pendulum may be finally shifting on this issue.

Home prices are at record levels now, not just in Boston and other fast-growing coastal cities, but in towns and urban areas across the country. Not only are house hunters and renters paying through the nose in order to put a roof over their heads, just finding something, anything, to buy is increasingly a challenge in a crazy tight market.

Even homeowners are unhappy, with many who in years past would have moved up to something bigger, instead opting to stay put and not sell, despite the huge run-up in prices. While it’s relatively easy to find a buyer these days, prospective sellers realize they will have to pay even more to land their next home – and once again, that’s if they can actually find one.

So kudos to Warren and other political leaders who are finally realizing that the high cost of housing is a key bread and butter issue, right up there with health care.

Here’s hoping Warren’s plan to rescues the housing market gains traction, whatever happens to her presidential ambitions.

Scott Van Voorhis is Banker & Tradesman’s columnist; opinions expressed are his own. He may be reached at sbvanvoorhis@hotmail.com.