Stricter immigration rules could slow down new home construction on federal land
President Donald Trump has declared victory in the US presidential election, pledging a "new golden age for America" and unveiling ambitious housing plans to address the nation's housing shortage.
His administration has proposed building new homes on federal land and promoting homeownership through tax incentives to combat the severe housing crisis. However, experts believe that Trump’s stricter immigration policies could hinder his housing goals.
In the face of a nationwide housing shortage, nearly 80% of Americans agree that more homes are needed, according to the Center for American Progress. The Republican platform proposes tackling this by constructing new housing on federal land.
But with immigrants making up 30-40% of the construction workforce, Trump’s proposed immigration restrictions could slow down these efforts. Real estate expert Cynthia Seifert, founder of KeyLeads, noted the potential impact of Trump’s policies on his housing initiatives.
“Trump’s main plan to counter rising housing costs is to implement tougher policies on immigration,” said Seifert, founder of real estate company KeyLeads. “However, this would likely slow housing construction as immigrants make up 30% of the US construction industry with this rising to 40% in states such as California and Texas. This threatens to reduce the number of new affordable homes that Trump plans to build on portions of federal land.”
Trump’s housing vision also includes promoting homeownership through tax incentives, though the specifics have yet to be outlined. Existing bipartisan-backed programs like the Low-Income Housing Tax Credit (LIHTC) and Neighborhood Homes Investment Act (NHTC) could be included as part of the Republican administration’s housing initiatives.
Trump has also pledged to bring down mortgage rates by “slashing inflation” and eliminating regulations that increase housing costs. Public sentiment aligned with this focus on affordability, with recent polling showing that 69% of Americans are highly concerned about housing costs, up from 61% in April 2023.
Read more: Trump wins – but what housing issue drove early voters?
However, economists have raised concerns about Trump’s plan to use tariffs to cut costs. A survey of 50 economists found that more than two-thirds believe such tariffs could drive up inflation, potentially working against Trump’s aim to reduce it.
Trump’s approach to rental housing remains unclear, but Vice President Vance has pointed to institutional investors as a factor in rising housing costs, saying they reduce the availability of homes. This could signal that the administration might take steps to limit large investment firms, potentially opening up more opportunities for individual buyers and impacting the rental market.
Seifert also highlighted that while Trump’s proposed policies could be favorable for homeowners, they may pose challenges for real estate investors.
“Trump has set out to reduce house prices by cutting regulations and increasing homeownership through tax incentives and support for first-time buyers,” she said in an emailed statement. “While this could benefit homeowners and negatively impact investors, it’s not clearly stated how these changes will be implemented and who they would affect.”
With few concrete details in the Republican platform, Seifert advises real estate agents to stay informed on policy developments.
“With housing plans remaining brief in the Republican party’s platform, it’s essential that real estate agents should stay close to the news to see how Trump’s housing policies take shape and reassure their clients with timely updates on what specific policies could mean for them,” Seifert added.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
