President Donald Trump’s bid to put home ownership in reach for more Americans is sputtering, just weeks after it launched.
“We’re not going to destroy the value of their homes so somebody who didn’t work very hard can buy a home,” he said at a cabinet meeting Thursday.
Housing is a particular sore spot for many Americans.
Trump, meanwhile, has repeatedly gotten sidetracked, failing to tout the affordability proposals the White House signaled would form a central plank of his messaging heading toward November.
Similarly, at a rally this week in Iowa — a key battleground in the November election — Trump failed to mention several of the affordability proposals at all.
The policies he does still support are ones he may have little power to enact.
Even if Congress carried out the request, it’s not clear how much impact such a move could have on prices. Larger institutional investors own less than 1% of the nation’s single-family housing stock, and just between 2% and 3% of its single-family rentals.
It’s not just housing policies that seem adrift.
That might not be enough.
“If the expected effect of this is rates will come down 25 basis points, that’s not a needle-mover,” said Ed DeMarco, president of the Housing Policy Council and former acting director of the Federal Housing Finance Agency from 2009 to 2014.
But keeping the purchases capped means mortgage spreads will widen once the spending stops, according to Jim Parrott, a nonresident fellow at the Urban Institute, who said the move “will only impact the cost of a mortgage as long as investors believe the extra demand will be there.”
After the funding is spent, “the administration will have to decide if they want to spend another $200 billion to keep prices down for longer,” he added. “It may be hard for them to stop.”
