On April 13, the Council of Economic Advisors announced the release of the 2026 Economic Report of the President, which covered topics from international trade to industrial supply chains to homeownership. A chapter entitled “Protecting and Rebuilding the American Dream of Homeownership” addressed the steps President Donald Trump has taken to reduce regulatory burdens, increase housing supply and make homeownership more accessible.

According to the report, the current administration has shifted economic policy to a “new posture of private-sector-driven demand and healthy supply unleashed by deregulation, pro-growth tax relief and America first trade.”

The report pointed to the plan the president instituted for Fannie Mae and Freddie Mac to buy $200 billion in mortgage bonds to reduce mortgage rates and the recent executive order that banned institutional investors from buying additional single-family homes.

The Department of Housing and Urban Development (HUD) has prioritized affordability, and its most significant accomplishment was rolling back the previous administration’s Affirmatively Furthering Fair Housing rule that “forced communities to waste time and resources drafting ‘equity plants’ in order to receive federal funds,” the report stated.

According to the report, real house prices increased 82 percent from 2000 to 2023, which was nearly seven times the rate of the real income growth at 12 percent. In 2000, a median-earning homeowner earned $84,000 and owned a house worth $212,000 (both in 2023 dollars) — a price-income ratio of 2.5 — while in 2023 a median-earning homeowner earned $94,000 and owned a house valued at $385,000 — a price-income ratio of 4.1. With house prices outpacing incomes, it became more difficult for buyers to satisfy loan-to-value and payment-to-income requirements when attempting to qualify for a loan, the report stated.

Regarding the impact of investor-owned homes on house prices, the report estimated that the share of institutional-investor-owned single-family homes was about 1 percent, with some metropolitan areas reaching 5 percent. Recent research found that “every 1 percentage point of housing stock bought by institutional investors causes house prices to rise by 1.7 percent. In areas like Atlanta that have a high concentration of institutional investor activity, the total price impact is about 6 percent.”

One paper found that when a corporation buys a home and converts it into a rental, the nearby properties experience a decline in value because of an increase in crime and a decrease in social capital, the report stated.

The report also noted that the government bureaucrat tax has decreased the housing supply by inflating building and renovation costs. The Council of Economic Advisors found that the bureaucrat tax accounts for approximately 42 percent of building costs, with fees, mandates, regulations and red tape making up about 29.5 percent of a new home.

Breaking that down farther, fees, delays and compliance costs account for 13.5 percent of building costs ($39,324), followed by changes to building codes over the last 10 years (8.6 percent, $25,250); requirements beyond ordinary standards and development (7.1 percent, $20,697); costs associated with outright barriers to new building (4.1 percent, $12,122); affordability mandates (3.8 percent, $11,176); compliance with nonstandard regulations (2.3 percent, $6,623); and cost of applying for zoning approval (2.3 percent, $6,623). Ultimately, these costs account for over $100,000 of a home’s building cost, according to the report.

Without reducing the price of building a home, and thus increasing the housing supply, mortgage rates dropping to the 2008 average of 4.5 percent would cause house prices to rise another 10 percent over the next three years, the report said.

According to the report, “the cost-savings and house price stability that result from slashing the bureaucrat tax make homeownership more accessible for new buyers and more secure for existing owners by relieving pressure on monthly budgets while protecting home values. Over time, supply growth also allows incomes to catch up after years of being outpaced by house price appreciation.”

The report noted that while homeowners gain illiquid wealth from rising home values, their monthly liquidity often tightens because of “the resulting payment increases they face from increases in property taxes and homeowner insurance induced by rapid house price appreciation, which can create financial distress.”

In addition, a prospective homebuyer’s monthly liquidity is one of the most important reasons for mortgage loan denials, along with the more binding constraint that prevents homeownership being the allowed maximum debt-to-income ratio, the report stated.

Several studies demonstrated that higher monthly payments “are a serious impediment to homeownership, and the drivers of higher payments include high interest rates, high house prices, and high debt burdens from other sources like student loans and credit cards,” the report continued.

The report also provided a list of state and local best practices to lower the bureaucrat tax, which could “rapidly incentivize new building by eliminating impediments, taxes, hold-ups, fees, processes and schemes that serve as barriers to new development.”

Some of these best practices include:

• Aligning codes with accepted standards for modular, prefabricated, panelized and other off-site built housing to enable “all of the above” quality construction techniques
• Creating a fast-track process for all housing developments that features capped timelines and permit fees, appropriate and justifiable impact fees, third-party inspections and binding arbitration that ensures faster and less arbitrary dispute resolution
• Curtailing artificial mandates that restrict housing supply such as green energy building requirements, aesthetic requirements, discriminatory labor rules and rent scammer protections while providing greater flexibility and consumer choice and stronger private property rights
• Streamlining the stages of homebuilding by having a binding timeline, which holds for all submissions and resubmissions, for when a regulating entity or utility must either grant or deny each of the required permits and approvals
• Eliminating rent control provisions; support for squatters, scammers and unauthorized occupants; and affordable housing set-asides that require units in a development to be set aside for renters paying less than market-rate for rent
• Eliminating non-evidence-based building codes and burdensome and prescriptive energy efficiency building codes

The report also addressed the economic and fiscal benefits of the budget bill, including its provision that enhanced Opportunity Zone incentives, which are projected to help “drive more than $100 billion in investment, create more than 1 million new jobs, and lead to hundreds of thousands of new homes in distressed communities, especially in rural areas.”

The report further detailed how reforms to regulations are projected to generate “over $5 trillion in potential long-run savings through a systematic reduction of regulatory burdens,” and how the current administration is “laying the groundwork for American [artificial intelligence] dominance by accelerating innovation, infrastructure development, and deregulation while establishing global supremacy through technology exports.”

Other topics discussed in the report include the economic consequences of diversity, equity and inclusion programs, the nation’s international trade policies, the nation’s dense industrial base and the necessity of competition in healthcare.

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