What Trump’s Win Could Mean for Housing

For many, housing was high on the docket of issues throughout the presidential election. During Vice President Kamala Harris and now President-elect Donald Trump’s debate in September, the first policy to come up was housing affordability.

“Housing, for the first time ever has really, you know, been at the top of a presidential campaign. I’m not sure this has ever been the case,” Ayrianne Parks, senior director of policy advocacy at Enterprise, a national nonprofit trying to address the shortage of affordable rental homes, tells TIME.

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Voters considered inflation at the ballot box on Nov. 5. Housing affordability is a part of this issue, and an NBC study shows that the toughest housing markets had the greatest median shift in vote toward Trump compared to the 2020 election.

With home prices having gone up, by some estimates, more than 50% since the COVID-19 pandemic, it’s unsurprising that housing affordability and markets would be a key focus for many.

Harris led much of the national discussion surrounding housing throughout the election, while Trump said very little about his housing policies during his campaign. In his policy platform, Agenda 47, he vowed to “make it a personal mission to totally eradicate Veterans’ homelessness in America by the end of next term.” He also said he will “rescue American cities from the scourge of homelessness, the drug addicted, and the dangerously deranged.”

Now that Trump is set to return to the White House, housing advocates, experts, and economists are considering what his second term might mean for housing by gleaning information from what he tried to do, and successfully did, during the first Trump Administration. Although much remains to be seen, such as his nomination for director of the Department of Housing and Urban Development, now that he has gained a trifecta of Republican control, Trump is likely to move quickly. 

“President Trump can be trusted to restore the American dream because he has a real plan to defeat inflation, bring down mortgage rates, and make purchasing a home dramatically more affordable,” Karoline Leavitt, the Trump campaign’s national press secretary (who is now serving as the Trump-Vance transition spokesperson) told TIME over email in September, when asked about how Trump will address the housing crisis. “He will rein in federal spending, stop the unstainable [sic] invasion of illegal aliens which is driving up housing costs, cut taxes for American families, eliminate costly regulations, and free up appropriate portions of federal land for housing.”

Here are three key areas in which Trump’s presidency could impact housing.

Mass deportation of immigrants

Trump and his Vice President J.D. Vance told voters that they will carry out the largest deportation program in history and stated that this mass deportation will lower housing prices. 

“When you let 25 million illegal aliens…when you let those folks in your country at the level that we have, you got to put them somewhere…and that means those are homes that aren’t going to American citizens,” Vance said in a NewsNation town hall hosted by Chris Cuomo. “That’s going to drive the cost of housing through the roof too.”

But many economists say there is no clear link between undocumented immigration and housing affordability and recent studies have actually found that deportation could reduce U.S. employment and lower GDP.

“If he’s true to his word about mass deportation, what it’s going to do to the construction labor market…it’s going to drive up costs and cause delays,” Alex Schwartz, a professor of urban policy at The New School in New York City, says. Currently, roughly 30% of the construction work force are immigrants, according to the National Immigration Forum.

For Rachel Fee, executive director of the New York Housing Conference, which advocates for affordable housing for New Yorkers, this mass deportation effort does not seem correlated to the housing issues in the city.

“In New York, we have had an affordability crisis and tight rental vacancy before an influx of migrants. It’s not impacted by that issue…so I don’t really see that as any type of solution,” she says.

In Agenda 47, Trump laid bare this plan specifically for veterans, stating that President Joe Biden “puts illegal aliens before homeless Veterans and we cannot let this happen any longer.”

But Fee points to programs that already exist for homeless veterans, like the HUD-Veterans Affairs Supportive Housing (HUD-VASH) program.“If that was really the problem that you wanted to solve, we have had successful efforts in the past with federal programs that are still ongoing and underfunded,” she argues.

Open federal land for construction to increase housing supply

During a speech in September, to the Economic Club of New York,  Trump promised to reduce regulations and open swaths of federal land for large-scale housing construction. 

“Regulation costs 30% of a new home, and we will open up portions of federal land for large-scale housing construction,” he said. “These zones will be ultra-low tax and ultra-low regulations—one of the great small business job creation programs.”

Biden called on federal agencies in July to “to assess surplus federal land that can be repurposed to build more affordable housing across the country.”

Though economists say this couldn’t hurt the housing crisis, how much it helps depends much on how such plans are implemented, and where these “federal lands” are actually located.

“It’s also not, you know, necessarily located near transit or jobs where you want to build,” Fee says. “In the past, there have been a couple of successful infill projects on Veteran Affairs (VA) campuses of supportive housing built to help veterans who were formerly homeless and who need services to remain stably housed…but I could think of probably just two examples. We have a much broader challenge than that opportunity would serve.”

Interest rates, budgets, and taxes

On the campaign trail, Trump said that he would bring down interest rates, putting emphasis on the Federal Reserve, an independent entity, as a way to reduce the interest paid by consumers or businesses. This could affect mortgage prices.

At a National Association of Black Journalists (NABJ) conference on July 31, Trump addressed both housing and interest rates, promising to “drill, baby, drill,” once he is in office.

“I bring energy way down, I bring interest rates [down], I bring inflation way down,” he said.

During his first term, Trump pressured the Fed to cut interest rates. Last week, Fed officials reduced their key interest rate for a second straight time, but officials see Trump’s proposed tariffs and deportations as potentials to increase inflation.

“Trump’s proposed economic measures could also elevate inflation which often results in increased mortgage rates. For instance, immediately after the election results, 30-year fixed mortgage rates jumped 9 basis points suggesting that investors anticipate higher borrowing costs in the near future,” says Cynthia Seifert, a former Texas realtor and founder of real estate generation tool KeyLeads. “However, if the Federal Reserve decides to lower interest rates, as it did in September, mortgage rates could decrease regardless of Trump’s presidential policies.”

As far as the budget goes, many experts say it is up in the air. “We saw pretty harmful cuts being proposed in his budget year after year,” Fee says of the first Trump Administration’s attempts to cut things like housing choice voucher programs and funding for public housing repairs. But these cuts did not pass due to checks in Congress.

Though she also has concerns for these kinds of cuts, especially with Republicans in control of both the House and Senate, Parks sees an opportunity, especially for the Low-Income Housing Tax Credit, which has bipartisan support. 

“You know, I think that is going to be a major push,” she says. “And, in fact, President-elect Trump has said that he wants to get tax done right away, within the first 100 days… We will be working with the presidential transition team, making sure that they understand the importance of these funding programs and hopefully also influencing those budgets that come out.”