Trump's Housing Conundrum: Pledging to Keep Prices High While Promising Easier Access for Buyers

WASHINGTON—In a bid to tackle one of the most persistent economic challenges facing Americans, President Donald Trump has outlined a vision for the housing market that seeks to satisfy two seemingly conflicting goals: preserving the wealth of current homeowners while making it easier for new buyers to enter the market.

"We're going to keep those prices up. We're not going to destroy the value of their homes," Trump declared during a recent Cabinet meeting, addressing existing homeowners. "And we're going to get interest rates down... to make the cost of owning a home more affordable."

This delicate balancing act comes as the Federal Reserve's latest Flow of Funds data shows a slight cooling from peak levels, with household real estate values dipping by $361 billion in Q3 2025. The administration's toolkit includes directing Fannie Mae and Freddie Mac to purchase $200 billion in mortgage-backed securities to pressure rates lower, alongside floated ideas like portable mortgages and 50-year loan terms.

Yet, the core of Trump's strategy hinges on a significant bet: that monthly payments can be eased through lower borrowing costs without triggering another dramatic home price appreciation that would negate any gains. Realtor.com® forecasts for 2026 project a 2.2% price increase alongside mortgage rates averaging around 6.3%, offering little breathing room.

The political and economic calculus is clear. "I want to protect the people who, for the first time in their lives, feel good about themselves," Trump said, framing home equity as a cornerstone of middle-class wealth. However, the mechanism for achieving broader access remains fraught.

Analysts point to a fundamental obstacle—a deep structural shortage of homes. "The U.S. is short roughly 4 million homes," explains Hannah Jones, senior economic research analyst at Realtor.com. "In a tight-supply market, falling rates mostly translate into greater bidding power, pushing prices higher rather than delivering lasting affordability gains."

The administration's $200 billion MBS purchase plan faces skepticism over its impact within a $12 trillion market. Simultaneously, Trump has signaled a potential shift at the Federal Reserve, nominating former governor Kevin Warsh to succeed Chair Jerome Powell in 2026. Warsh, despite a hawkish reputation, has recently advocated for lower short-term rates.

History offers mixed lessons. The post-2010 recovery saw both rising prices and improving affordability, fueled by depressed post-crisis prices and income growth. Conversely, the 2020-2021 rate drops supercharged prices amid scant supply. "Without stronger income growth or a meaningful increase in supply, lower rates are more likely to fuel prices than sustainably improve affordability," Jones concludes.

The path Trump envisions—easier buying without cheaper homes—is not impossible, but it requires a rare alignment of increased supply, moderated demand, or accelerated wage growth. In the current climate, where none of those conditions are predominant, the president's promises risk pulling the market in opposing directions.

Reader Reactions:

"As a first-time buyer in Phoenix, this feels like empty promises. Lower rates just mean more competition from investors and all-cash offers for the few houses available. They're not building enough where people need to live." — Marcus Chen, 32, Software Engineer

"Finally, a president who understands that my home is my retirement nest egg. Protecting equity is crucial for millions of seniors. Making it easier for young people to buy shouldn't come by stealing from those who worked decades to own." — Debra Wilkinson, 68, Retired Teacher

"It's pure economic fantasy. You can't will affordability into existence with rate cuts while ignoring the 4-million-home shortage. This isn't policy; it's a real estate investor's dream and a first-time buyer's nightmare. The $200B MBS move is a drop in the bucket and will only inflate asset prices further." — David Park, 45, Urban Policy Analyst

"If wages were rising meaningfully, this approach could work. But they're not. So this just sets up another bubble. We're recycling the same demand-side tricks that got us here, completely sidestepping the supply crisis." — Rebecca Soto, 41, Housing Nonprofit Director