President Donald Trump highlighted taxes, inflation and trade in his State of the Union address on Tuesday evening, but he made only a passing reference to housing, leaving affordability largely unaddressed to the chagrin of housing professionals.
Housing professionals had expected a larger discussion on mortgage rates, homeownership initiatives and the policies introduced since Trump began his second term in January 2025. Many housing executives praised the administration’s focus on affordability in the address, but others emphasized the need for stronger action to increase housing supply and protect consumers.
During Trump’s 107-minute address, he mentioned mortgage rates once. He spent some time defending tariffs on imported building materials and restrictions on corporate homebuyers. But not much of the address was new information, according to Cotality chief economist Selma Hepp.
“It was the same talk as we heard at Davos,” Hepp said in an interview with HousingWire. “But it just illustrates how difficult the housing market challenges are. If it were something simple, I am sure that it would be addressed, or there would have already been a proposal out there. But the proposals that are out there are maybe not necessarily so exciting to talk about in the State of the Union address because they’re deep into the weeds.”
Hepp said she had hoped to hear about Trump’s plan for wage growth and a different solution other than lowering mortgage rates.
“The President reiterated his position that a decrease in mortgage rates, which have dropped around 1% in the last year, will be key to improving housing affordability,” Marc Halpern, CEO of Foundation Mortgage, said in a statement. “Nonetheless, mortgage rates continue to move lower very slowly, with a 30-year mortgage hovering around 6%, and recent minutes from the Federal Open Market Committee … indicate that without a further reduction in inflation, mortgage rates are unlikely to shift lower than another percentage point this year, and that’s a generous prediction.”
Industry groups representing rental housing also weighed in.
Bob Pinnegar, president and CEO of the National Apartment Association (NAA), and Sharon Wilson Géno, president of the National Multifamily Housing Council (NMHA), said the U.S. needs “decisive” actions to remedy the housing crisis.
“NAA-NMHC research shows we need to build 4.3 million more apartments by 2035 to meet demand,” Pinnegar and Géno said in a joint statement. “To date, the Trump Administration has implemented a number of pro-housing, common-sense policies — from easing burdensome regulations to eliminating barriers that slow development — which are important steps in the right direction. Yet now more than ever is the time for decisive and transformational action.”
“What this country needs is a committed, clear plan on how we’re going to finally address our national shortage of affordable housing for renters and homeowners alike,” added Sarah Brundage, president and CEO of the National Association of Affordable Housing Lenders (NAAHL).
“Mortgage rates matter, but they are only one piece of the puzzle. The deeper problem is that we simply don’t have enough homes — especially for owner-occupancy. Until we address the chronic shortage of housing supply, lower rates alone won’t put homeownership within reach for families.”
Trump said during the address that rent prices were lower than when he took office. But Hepp said that’s not entirely true, according to Cotality’s research.
“They have not come down. I think that this is maybe where inflation gets confused with decline, because there’s been a decline in the rate of inflation, so the rate of increase has come down, but actual rents have not come down,” Hepp said. “There are places where rents have gone down because there’s been so much new construction of multifamily housing, which, again, speaks to the importance of new construction.”
Leaders urge passage of bipartisan measures
Pinnegar and Géno also called on Congress and the White House to support “critical” bipartisan measures, including the ROAD to Housing Act, the Housing for the 21st Century Act and the Workforce Housing Tax Credit. They also highlighted the role of build-to-rent communities and institutional investment in supporting housing development.
Shannon McGahn, executive vice president and chief advocacy officer for the National Association of Realtors, also urged the passage of housing measures, namely the Housing for the 21st Century Act.
“Unlocking existing inventory, streamlining regulatory barriers, incentivizing new construction, and supporting responsible development are all essential components of addressing housing affordability,” McGahn said. “That includes reforming outdated capital gains thresholds that have not been updated in decades and now discourage longtime homeowners from selling, reducing mobility and limiting the number of homes available for new buyers.”
Chris Morton, CEO of the American Land Title Association, offered a similar sentiment.
“Housing affordability depends not only on supply and financing conditions but also on maintaining strong consumer safeguards that preserve the integrity of property rights and prevent the financial harm that can derail families’ investments,” he said.
Brundage said NAAHL is encouraging the passing of the Neighborhood Homes Investment Act, which would create a federal tax credit to build and repair the affordable starter homes that homeowners need.
“And to help make sure that families have access to an affordable mortgage, we also need to ensure that Fannie Mae and Freddie Mac maintain a robust commitment to serving low- and moderate-income families ready for homeownership in all parts of the country,” she added.
Institutional investor pushback
During the address, Trump called on Congress to make permanent his executive order that restricts institutional investors from buying single-family homes, even though this group only represents about 2% of all home sales.
“They’re very regional,” Hepp explained. “There are like five markets in the U.S. where you have a lot of institutional investors.”
Pinnegar and Géno also pushed back on the policy proposal.
“Institutional investors support retired teachers, firefighters, union laborers and others who invest their retirement savings in multifamily housing through their participation in pension funds, life insurance companies, real estate investment trusts and other similar investment funds.”
Brundage added: “The president hit on a key issue that many policymakers and elected officials have been raising — we need more affordable homes for homebuyers in nearly every part of the country. Creating the supply we need will mean both building new homes and also fixing up the ones we have without pricing out families.”
Hepp said that banning institutional investors will not necessarily resolve the housing crisis.
“In some ways, we shouldn’t prevent investors from participating in new construction, because then we’re not adding new inventory,” she said. “The thing about institutional investors is they do a lot of repairs to homes, and our housing stock is aging. Those are repairs that sometimes homeowners cannot afford.”
Hepp has ideas for other solutions.
“There’s potentially a lot of private capital that’s sitting on the sidelines that can be incentivized to invest in community development and affordable housing projects,” she said. “I’d also like to see investors creating some sort of built- or rent-to-own program, where investors can start buyers off renting with some plan to be able to own down the road.”