Could Trump’s Housing Plans Reshape The Real Estate Market?

Housing proposals put forth by President-elect Donald Trump could have a mixed impact on the high housing costs, as per the analysis of economists and industry experts.

What Happened: Trump’s proposals to cut federal construction regulations, utilize federal land for housing, and reduce energy costs might help in bringing down housing costs.

Conversely, his plans to hike tariffs, deport immigrants in large numbers, and reduce housing assistance could potentially lead to an increase in home prices and rents.

Industry leaders and housing policy experts suggest that the impact on housing costs will largely be determined by the amount of new supply that can be brought into the market, which is currently grappling with a severe shortage of homes.

Jim Tobin, CEO of the National Association of Home Builders, is hopeful that Trump will roll back some of the energy efficiency requirements introduced by the Biden administration, streamline regulations under the Clean Water Act, and relax the requirement for Federal Housing Administration borrowers’ homes to be up to code.

“We need all options on the table when it comes to increasing housing supply, which means allowing more density in suburbs or cities to allow more units to be produced,” Tobin told Business Insider.

Trump’s idea of building up to 10 “freedom cities” on federal land has garnered some bipartisan support. Housing experts are of the opinion that this proposal could increase the housing supply, particularly in Western states with large tracts of federally owned land.

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However, Trump’s plans to cut taxes and deport millions of immigrants could lead to inflation and discourage the Federal Reserve from further rate cuts.

Plans by Trump and Vice President-elect JD Vance to deport millions of immigrants are seen by many economists as likely to inflate housing costs, given the significant role immigrants play in the construction workforce.

During his first term, Trump advocated for significant reductions in housing assistance for low-income households and individuals with disabilities.

Renewing these cuts could further challenge lower-income Americans’ ability to afford housing and hinder the progress of affordable housing development.

Why It Matters: Trump’s housing proposals, if implemented, could significantly reshape the housing market.

The potential impact on housing costs, both positive and negative, will be closely watched by industry experts, economists, and potential homebuyers alike.

The balance between increasing supply and maintaining affordability will be a key factor in determining the success of these proposals.

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This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.