Housing News

President Trump Attempts to Boost Housing Affordability with Executive Orders

The White House is instructing federal agencies to closely examine regulations governing housing construction and mortgage lending as part of a new effort to address the country’s ongoing housing affordability issues.

On Friday, President Donald Trump signed two executive orders. They directed federal agencies, including the U.S. Department of Housing and Urban Development and the Federal Housing Finance Agency, to identify regulations that may be hindering residential development or making it more difficult for lenders to provide home loans.

A second executive order aims to make it easier for homebuyers to secure mortgages. It proposes expanding the definition of qualified mortgages under the oversight of the Consumer Financial Protection Bureau. It would also establish more specific requirements for banks of various sizes and update the appraisal process to enable increased use of AI-based property valuations.

“We agree with the administration’s focus on addressing costly mortgage regulations that have increased costs and limited access to credit,” said Mortgage Bankers Association (MBA) President and CEO Bob Broeksmit in a statement.

The move came a day after the Senate approved the bipartisan 21st Century ROAD to Housing Act legislation. It was geared toward boosting housing supply and cutting regulatory hurdles that can delay new construction.

The efforts reflect growing attention in Washington on reducing red tape as housing affordability remains a concern for buyers nationwide.

A presidential focus on increasing the housing supply

One of the executive orders requires federal agencies to review regulations that could delay residential building or raise costs.

The order urges agencies to identify rules governing permitting, environmental review, and other regulatory processes that may slow housing development. The aim, according to the White House fact sheet, is to eliminate barriers that could be restricting the pace of new construction.

Housing economists often cite housing supply shortages as a major factor driving up home prices. Many areas have struggled to build enough new homes to keep up with population growth and demand.

Federal officials state that the review aims to determine whether specific requirements can be streamlined while still upholding safety and environmental standards.

If agencies ultimately revise or eliminate some of those regulations, the administration argues that this could lower development costs and speed up the construction of new homes.

Mortgage rules are also under review

A second executive order addresses mortgage lending and home loan costs. Officials say the purpose of the review is to determine whether regulatory changes could help lower costs or increase access to home loans.

The directive instructs the federal regulator, the Consumer Financial Protection Bureau, to review rules that the administration claims may have discouraged smaller lenders from providing mortgages or limited credit availability for potential homebuyers.

The review will examine whether modifications to those regulations could make borrowing easier for qualified buyers while maintaining proper lending safeguards, according to the White House.

President Trump’s broader housing push

The executive orders expand on several other housing-related initiatives announced earlier this year.

The administration previously encouraged Fannie Mae and Freddie Mac to expand their purchases of mortgage-backed securities to support the mortgage market. This temporarily brought mortgage rates down.

Federal officials have also examined proposals to ban institutional investors from buying up homes in the single-family housing market.

Together, the policies aim to address various factors influencing affordability, such as housing supply, borrowing costs, and market competition.

Will Trump’s executive orders make housing cheaper?

Executive orders primarily direct federal agencies to review and assess existing regulations. So, any updates to rules governing construction or mortgage lending would likely take some time.

Agencies must first carry out their regulatory reviews and identify which policies could be updated or removed. Some changes might also need formal rulemaking or Congressional approval.

As a result, it may take some time for the housing market to feel the impact of these executive orders.