As the United States grapples with a severe housing affordability crisis, President Donald Trump has identified this issue as a priority to address in his political agenda. He has proposed a bold plan to “deliver emergency price relief” through an emergency order that aims to reduce regulatory barriers, expand housing supply, and restore purchasing power to American families. This well-timed initiative has sparked significant debate among policymakers, real estate professionals, and economists. While some hail it as a much-needed intervention, others voice concerns about its feasibility and potential risks.
Housing affordability has been a persistent challenge in major metropolitan areas, small towns, and rural communities. The obstacles—ranging from regulatory red tape and restrictive zoning to the massive housing supply gap—underscores the complexity of this issue. In this article, we’ll break down the components of Trump’s plan, dive deeper into the regulatory challenges influencing housing costs, and evaluate the implications for local housing markets like Las Vegas. We’ll also explore the opportunities this creates for real estate professionals and suggest innovative pathways to address the housing crisis.
Understanding the Cost of Housing: Regulatory Challenges
The skyrocketing cost of housing in the U.S. is driven not only by demand but also by the ever-growing expenses tied to building new homes. One of the primary culprits behind these inflated costs is the burden of regulatory compliance. Danielle Hale, Realtor.com’s chief economist, estimates that regulations add approximately $90,000 to the construction cost of a new home. These costs include zoning laws, hefty permitting fees, environmental requirements, and compliance with building codes. This significant financial barrier stifles developers from creating the large volume of homes needed to address housing shortages.
Regulatory policies often have noble intentions—such as ensuring safety, environmental protection, or preserving community aesthetics. However, the patchwork of federal, state, and local regulations contributes to inefficiencies and bottlenecks. Local zoning laws, in particular, play a dominant role. Single-family zoning, which is predominant in many U.S. cities, restricts the types of housing that can be built, drastically limiting options for lower- and middle-income earners. These zoning rules frequently prohibit higher-density housing like duplexes or apartment buildings, further exacerbating the crisis.
Moreover, many municipalities have policies that are slow to adapt to market needs. For example, lengthy land-use approval processes can delay construction projects by years, steadily driving up the cost to build. While Trump’s plan targets federal regulatory reform, local governments hold the lion’s share of power over land-use decisions. Overcoming this fragmentation is a monumental challenge that will require creative solutions and collaboration from all levels of government.
Trump’s Plan to Address Housing Costs
At the heart of Trump’s approach to the housing crisis is his emergency order to “deliver emergency price relief.” This directive builds on his administration’s previous efforts, which, during his first term, reduced regulatory costs of homeownership by approximately $11,000 per household. His current proposal encompasses more ambitious goals, with a focus on reducing regulatory red tape and increasing housing supply.
Here are the main components of Trump’s housing affordability plan:
- Reducing Federal Regulations
Federal departments and agencies are directed to review and eliminate unnecessary regulations that hinder housing construction or increase costs. For instance, environmental impact review requirements, which can stall projects for years, could be streamlined or expedited. - Incentivizing Local Governments
Trump’s plan aims to encourage local governments to revise restrictive zoning laws and expedite permitting processes. Financial incentives or federal grants could be offered to cities and counties that adopt “pro-housing” development policies. - Expanding Housing Supply
By issuing guidelines or providing funding for affordable and workforce housing projects, Trump seeks to close the staggering housing supply gap. Encouraging innovation in construction, such as modular housing or 3D-printed homes, might also be part of the solution.
While these proposals are promising on paper, their execution remains uncertain and faces significant hurdles, particularly when transitioning policy changes from the federal level to municipalities.
The Role of Local Governments in the Housing Crisis
Local governments have a profound influence on housing markets due to their control over zoning, permitting, and land-use policies. Restrictive zoning laws have long been criticized for limiting the types of housing that can be built, further constraining affordability. Single-family zoning is one of the most restrictive practices. In many communities, zoning rules prohibit high-density or multi-family housing projects, which disproportionately impacts low-to-moderate income families.
Many municipalities argue that such zoning laws are necessary to preserve “neighborhood character.” However, studies suggest that these policies unintentionally lock out renters, first-time buyers, and marginalized groups. Expanding permissible land use for affordable apartments and duplexes could unlock thousands of housing opportunities in major metro areas.
Additionally, permitting processes impose significant delays on the timeline for initiating new construction projects. In some cases, developers wait months—or even years—to secure a building permit. Accelerating this review process while maintaining high safety standards could allow cities to support an influx of new housing and stabilize their markets.
The Federal Government’s Tools for Tackling Affordability
The federal government has resources beyond regulatory reforms that can affect housing affordability. The Trump administration has also spotlighted two other relevant areas: mortgage policy reform and monetary policy.
Mortgage Policy Reforms
Fannie Mae and Freddie Mac, government-sponsored enterprises (GSEs), have long played a central role in keeping mortgage financing affordable for American families. Trump has floated ideas of privatizing these institutions, which have been under federal conservatorship since the 2008 financial crisis. Proponents argue that privatization will inject more competition into the mortgage market, potentially lowering fees and expanding access to credit. However, critics worry this approach could destabilize these programs, making it more difficult for lower-income buyers to secure financing.
Federal Reserve Influence
Trump has repeatedly expressed a desire for lower mortgage rates as a cornerstone of affordability. By pressuring the Federal Reserve to lower interest rates or maintain a dovish monetary policy, his administration believes it can incentivize homeownership and construction. Lower borrowing costs could attract new buyers into the market, strengthening demand.
However, both tools have limitations. Lower interest rates or expanded mortgage availability can boost demand, further aggravating the housing shortage if not paired with concurrent supply-side measures. Balancing these elements will be crucial.
Addressing the U.S. Housing Deficit
The crux of America’s affordability crisis lies in its massive housing supply deficit. Estimates suggest that the U.S. is short between 2.5 million and 7.2 million homes—a gap that has widened steadily due to years of underbuilding following the 2008 housing crash. High land acquisition costs, labor shortages, and rising material prices have only amplified this problem.
Danielle Hale points out that regulatory costs constitute about 22% of home construction expenses. If these costs were significantly reduced, developers would find it easier to build more units at price points that are accessible to first-time or low-income buyers. However, more housing supply alone won’t fully address the issue, as rising demand and stagnant wages remain significant obstacles to affordability.
Innovative construction techniques, such as 3D-printed homes and prefabricated housing units, offer promising solutions to ramp up supply quickly and at lower costs. Encouraging mass production through technology could close a significant portion of the housing gap within the next decade.
Implications for the Las Vegas Housing Market
Las Vegas has long been a city of extremes, and its housing market is no exception. Known for its affordability compared to neighboring California metros, Las Vegas has recently seen a rapid escalation in home prices, driven by population growth and low housing inventory. Regulatory bottlenecks in Nevada, such as lengthy permitting processes and restrictive zoning, reflect the broader national pattern of constraints.
Should Trump’s initiatives materialize, Las Vegas could stand to benefit from expanded federal support for affordable housing. Developers in the area, particularly in regions like Henderson or Summerlin, could see fewer bureaucratic hurdles, spurring new construction projects at a faster pace.
For buyers, this means greater inventory and potentially stabilizing prices. For sellers, it may enhance demand as affordability brings more buyers to the market. For real estate agents, like Steve Hawks, capitalizing on these fluctuations will be critical to thriving in a competitive landscape.
Opportunities for Real Estate Professionals
As regulations transform and the housing market adapts, real estate professionals are presented with both challenges and opportunities. Industry leaders like Steve Hawks, a Las Vegas native and an expert in uncovering off-market inventory, are well-positioned to navigate these changes.
Here’s how agents can leverage the shifting landscape:
- Educate Clients on Policy Changes: Understanding the impact of new state and federal housing policies is critical for advising both buyers and sellers.
- Promote Innovative Financing Options: With potential mortgage policy reforms on the horizon, agents can help clients explore more competitive rates.
- Capitalize on New Construction Opportunities: Developers ramping up projects to fill inventory gaps will need partnerships with agents to move properties quickly.
In short, by staying informed and adapting proactive strategies, real estate professionals will remain indispensable as the market evolves.
The Top Housing Spots to Watch for in 2025
Even amid a national housing crisis, certain metro areas are expected to emerge as affordable havens. Cities like Austin, Raleigh, Portland, and Las Vegas are already witnessing rising demand thanks to their attractive pricing, job opportunities, and livable communities. Las Vegas, in particular, may remain an appealing destination for families and remote workers priced out of larger markets like Los Angeles.
With targeted investment in infrastructure and potential regulatory relief, Nevada builders could meet population growth projections and attract new residents seeking value over inflated pricing in other comparative metros.
What It Will Take to Truly Solve the Housing Crisis
Resolving the housing affordability crisis hinges on tackling multiple dimensions:
- Streamlining Regulations: At both federal and local levels, cutting unnecessary red tape and modernizing zoning laws will be critical.
- Encouraging Innovation: Wider adoption of modular and 3D-printed homes can significantly reduce supply chain challenges.
- Boosting Economic Policies: Expanding policies that align job growth, wages, and housing affordability could stabilize housing markets long-term.
Collaboration between government, industry players, and community advocates is essential to build a sustainable and equitable housing future.
Key Takeaways
Here are the most notable points discussed in this article:
- Regulations Drive Costs: Regulatory compliance accounts for as much as $90,000 in additional costs for new home construction, underscoring the need for reform.
- Trump’s Key Focus Areas: The plan targets reducing federal red tape, incentivizing local-level action, and expanding supply through new housing initiatives.
- Local Government is Key: Since most housing laws, including zoning, are local, federal actions alone cannot solve the crisis without local-level cooperation.
- Federal Tools: Mortgage policy and monetary incentives may ease affordability but must be balanced against the housing supply gap.
- Las Vegas Implications: Regulatory relief could open new opportunities for buyers, sellers, and developers in areas like Henderson and Summerlin.
- Real Estate Professionals’ Role: Realtors can prepare by staying informed, advising clients on shifting markets, and partnering with developers on new construction.
- Holistic Solutions Required: Addressing the housing deficit, embracing construction innovation, and supporting income growth are all key in resolving the crisis.
Trump’s push to tackle the housing affordability crisis presents both challenges and opportunities. Real progress, however, requires a coordinated approach across all levels of government—and individuals like Las Vegas real estate expert Steve Hawks are best positioned to help buyers and sellers make sense of these changes. For those navigating today’s markets, knowing where to turn for guidance is essential.
Looking to buy or sell in Las Vegas? Contact Steve Hawks, your trusted local expert, for guidance in navigating today’s dynamic housing market. Explore new opportunities and make informed decisions—visit Steve Hawks Real Estate to learn more.