Congress targets housing crisis as solutions elude Trump

A suburban housing development in Seguin, Texas, Dec. 9, 2025. Bipartisan Senate and House packages, aimed at rewarding new construction and eliminating red tape, could bring significant changes to federal housing laws. (Callaghan O’Hare/The New York Times)

By RONDA KAYSEN

President Donald Trump has struggled to address the housing crisis. But Congress has been moving forward with legislation that, if signed into law, could bring the most significant changes to federal housing laws in a generation, potentially igniting a building boom.

In October, the Senate approved a package of bills to reduce regulations, as well as to give communities incentives to build more homes and renovate existing ones. In December, the House Financial Services Committee passed a similar package that could lay the groundwork for a national building code offering a cohesive alternative to the existing patchwork of codes and guiding communities on ways to build faster. The bills have significant overlap.

The House bill is expected to get a vote on the floor next week, and congressional leaders from both parties say they are optimistic that it will pass. The White House has indicated that it would support congressional housing legislation.

“Congress is going to act on housing this year — it’s a question of when, not if,” said Shaun Donovan, CEO of Enterprise Community Partners, a nonprofit housing organization, in a telephone interview.

“Housing is the No. 1 economic issue in the country,” added Donovan, who was secretary of the Department of Housing and Urban Development under President Barack Obama. “It is the single most important affordability challenge that Americans are facing. And, as we’ve all come to recognize in the last few months, affordability is at the center of our politics.”

Trump’s focus has been on the demand side of the crisis. He and his advisers have said, mostly in social media posts, that he wants to lower borrowing costs and make it easier for buyers to tap their retirement savings. But he has not released a comprehensive plan to address the crisis, and the small moves he has made may not provide lasting relief.

In January, for example, the president directed mortgage giants Fannie Mae and Freddie Mac to buy back $200 billion in mortgage-backed securities, a move that could drive down interest rates temporarily. Later he signed an executive order directing federal agencies to evaluate the role institutional investors play in the housing market. Many economists think those moves will have a marginal impact, as would other ideas that the Trump administration has proposed, like instituting portable and assumable mortgages, if they are even feasible.

Making it cheaper to buy a house would not address the central reason for the crisis: a housing shortage. It could even worsen things by pumping up demand without boosting supply. For almost 20 years, the country has not been building enough homes, and it is now short by as many as 7 million units. That’s a big reason home prices have surged 55% since the start of the pandemic, according to the National Association of Home Builders, and why buyers and renters struggle to find places to live.

The congressional bills are designed to make it faster and cheaper to get shovels in the ground.

“Both packages absolutely pull back regulatory barriers that are holding back housing,” said Alex Horowitz, the project director of housing policy for Pew Charitable Trusts, adding, “They will make a dent in the housing shortage.”