To amend the Internal Revenue Code of 1986 to modify the rules for investments in qualified opportunity funds, and for other purposes.

This bill, known as the Housing Opportunity Act of 2026, proposes significant changes to the federal Opportunity Zone program to encourage long-term investment in distressed communities. It would extend the designation period for these zones from 10 to 20 years and push the deadline for investors to defer capital gains taxes from 2026 to 2036. By providing a longer timeline, the bill aims to give developers and investors more certainty to complete large-scale projects in underserved areas.

For everyday citizens, the bill introduces new protections and requirements for residential rental projects funded through this program. To qualify for the most favorable tax benefits, a project would need to ensure that at least 30% of its units are occupied by residents earning the area's median income or less. Additionally, the bill proposes a 3% annual cap on rent increases for these units and would require landlords to provide at least 60 days' notice before raising rent.

If enacted, these changes would shift the focus of the Opportunity Zone program toward affordable housing. While investors would receive extended tax breaks, those benefits would be tied to maintaining lower rents and providing stable housing for working families. The bill seeks to balance economic revitalization with anti-gentrification measures by ensuring that new developments remain accessible to the current residents of the community.