A shortage of homes is the ‘number one driver of housing cost,’ said a real estate expert.
President Donald Trump issued an executive order calling on authorities to ensure that U.S. citizens have access to cheaper housing.
“Many Americans are unable to purchase homes due to historically high prices, in part due to regulatory requirements that alone account for 25 percent of the cost of constructing a new home,” said the Jan. 20 order from Trump.
“Unprecedented regulatory oppression from the Biden Administration is estimated to have imposed almost $50,000 in costs on the average American household, whereas my first-term agenda reduced regulatory costs by almost $11,000 per household.”
“It is critical to restore purchasing power to the American family and improve our quality of life,” the order said while calling on the heads of all government agencies and executive departments to deliver “emergency price relief” to citizens.
This includes pursuing actions to bring down the cost of housing and boosting the housing supply.
According to data from the National Association of Realtors (NAR), a median-priced, existing single-family home cost $410,900 as of November 2024, up from $357,100 in 2021. Mortgage payments as a share of income climbed from 16.9 percent to 25.2 percent.
Meanwhile, Freddie Mac estimates a shortage of 3.7 million units in the United States as of the third quarter of 2024. This was only a small dip from the 3.8 million shortage roughly four years back in the fourth quarter of 2020.
NAR Chief Advocacy Officer Shannon McGahn welcomed Trump’s executive order, calling supply shortage the “number one driver of housing cost.”
Persistent high costs not only hurt the market but also push away first-time prospective buyers. In discussions with the Trump team, NAR members asked the administration to focus on affordability, property rights, and inventory, the group said.
“The president’s executive order underscores the critical need for bold, coordinated action to lower housing costs and increase the availability of homes for families across this country,” McGahn said.
Mortgage Rates, Federal Lands
In a Jan. 21 post, Redfin economist Chen Zhao said Trump’s first-day actions “will push mortgage rates down slightly.”
