Staff Reports
The housing market, a crucial part of the American economy, has seen some interesting shifts recently, thanks in large part to the Trump administration’s bold moves. In an attempt to reform the housing narrative, President Trump has announced a ban on corporate purchases of single-family homes. Furthermore, his administration has backed government firms to buy $200 billion in mortgage-backed securities. This move is being hailed as a step toward giving individual families a fighting chance to own a piece of the American dream, rather than seeing single-family homes transformed into investment properties for wealthy corporations.
The strategy behind the bond buyback is to put downward pressure on mortgage rates. Reports indicate these efforts may be bearing fruit, with mortgage rates seeing slight dips. For anyone doing quick math, a modest interest rate reduction might save homeowners about $70 per month on a 30-year mortgage on a $400,000 home. While seventy bucks a month doesn’t exactly set off fireworks, any opportunity to save funds is well appreciated by Americans who’ve been feeling the pinch of rising costs everywhere else.
President Trump’s rallying cry, that people should live in homes, not corporations, sounds quite stirring. However, some skepticism remains. Currently, corporations own around 300,000 single-family homes nationwide, a mere 2% of all U.S. single-family rentals. If these corporate-owned homes were suddenly put on the market, prices might drop, but would this really make the housing market more accessible for everyday Americans? The reality is these major corporations aren’t looking to scoop up homes one at a time. Instead, they buy in large segments, often apartment complexes or multiple units.
Interestingly, corporate ownership does significantly impact some regions more than others. Places like Memphis, Tennessee, and certain areas in Mississippi and Arkansas are seeing a notably higher percentage of single-family homes owned by corporations, with figures reaching 25%. Similar trends appear in St. Louis, Kansas City, and others. So, in these regions, stiff curbs on corporate buying could make more of a difference. Should corporate purchases take a step back, the housing demand might soften, potentially giving buyers a better chance to find homes at fairer prices. Sellers might squirm a little with a key buyer out of the picture, but the objective is surely about making housing more accessible for families, isn’t it?
And then there’s always the matter of taxes. Quiet yet potentially influential adjustments have been made, like the availability of increased adoption tax credits and expanded state and local tax deductions. These changes could translate into sizable savings, sweetening the deal for many would-be home buyers. While the administration is focusing on curbing corporate appetites, behind-the-curtain tax reform seems set to lend a helping hand to those poised to dive into the home-buying process. All this drama in the housing market makes for an exciting if somewhat hopeful narrative, where families might just find themselves in a better position to call a house a home.
