Trump wants to fix the housing affordability crisis: Can he?

Within his first few days in office, President Donald Trump issued an emergency order directing the heads of all executive departments and agencies to “deliver emergency price relief,” which he emphasized would include lowering the cost of housing and expanding supply. 

“It is critical to restore purchasing power to the American family and improve our quality of life,” an executive action signed by Trump on Monday read.

The Trump administration cited regulatory requirements as a main driver why so many Americans are unable to purchase homes. In his first term, Trump reduced regulatory costs by almost $11,000 per household, the White House said in a fact sheet. 

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Real estate experts are in agreement that the housing crisis is a problem the federal government cannot solve alone and that several levels of government need to be involved to make a significant change. 

“Trump’s plan to cut regulatory red tape focuses on construction costs, but most housing regulations, like zoning laws and permitting, are controlled by local governments. The federal government has limited authority here, so meaningful change would likely require incentivizing local governments or taking unprecedented federal actions, such as overriding local zoning laws,” Redfin chief economist Daryl Fairweather told FOX Business.

Still, several experts agree Trump can put immense pressure on the issue to move the needle.

Realtor.com chief economist Danielle Hale told FOX Business that the U.S. is facing a deficit between 2.5 million and 7.2 million homes, which underscores the dire need to build more housing. She said regulatory requirements, which can add significant costs to building and have been a barrier to ramping up supply, are a good place to start. 

For one, about $90,000 of the cost of new construction is due to regulation and regulatory compliance, Hale estimated. 

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“With new construction just over $400,000, that’s a pretty hefty percentage. That suggests there’s some room to address this regulation,” Hale said. “Maybe we can take a review of these regulations and find areas where maybe we can cut back on some of the rules or fees associated with those regulations to improve the outcome and enable builders to not just build more housing, but build it more quickly and more cost effectively.” 

Noel Roberts, founder of real estate firm Pending, which specializes in off-market transactions, also believes that the key to making housing affordable is increasing supply.