Planet Money (NPR)

Episode: Can Trump make buying a home more affordable?

Date: January 31, 2026
Hosts: Erica Barris & Nick Fountain

Overview

This episode examines the Trump administration’s new efforts to address housing affordability in America, a crucial economic and political issue. With stories from struggling homebuyers, including the remarkable lengths some go to save for a home, the hosts delve into the administration’s two main moves: an executive order targeting Wall Street landlords and a $200 billion intervention in the mortgage bond market. Through interviews with housing experts, they probe whether these actions could actually help would-be buyers—or miss the mark.

Key Discussion Points and Insights

1. A Personal Story of Housing Struggle

• James Lawrence, a National Guard member, highlights the extreme measures many Americans take to afford a down payment:

  • Gave up apartment (rent raised from $900 to $1,700/month).
  • Lived at a campsite and his car during work and National Guard training.
  • Ultimately volunteered for a deployment to Djibouti for hazard pay and tax-free income, all to save for a home.
  • Quote:

    "I rented a campsite where I just set up one of my tents. And I was literally living out of my car while going to work, while being in the National Guard, while going to school." — James Lawrence (02:13)

• Trend Highlight:
  Median age of first-time homebuyers is now 40 (was 28 in the early 1990s).

2. Trump’s Promise: Home Affordability Without Lowering Prices

• Trump is careful not to alienate current homeowners, stating he wants prices to keep rising for them.
  • Quote:

    "We're going to keep them wealthy, we're going to keep those prices up. We're not going to destroy the value of their homes so that somebody that didn't work very hard can buy a home." — Donald Trump (07:19)

3. Trump’s Executive Order: Curbing Wall Street Landlords

• Policy: Executive order aimed at stopping large Wall Street investors from competing with individual buyers for single-family homes.

• Myth vs. Reality:

  • Popular belief: Corporate investors are a prime cause of high housing prices.
  • Actual scope: Large institutional investors only own about 0.3% of all U.S. homes, but concentration is much higher in Sunbelt cities (e.g., parts of San Antonio, Atlanta, Charlotte, Phoenix).
    • Quote:

      "The ownership share as of 2022 is about 0.3% of all housing units in the United States." — Caitlin Gorbach, UT Austin economist (12:01)

• Impact on Prices and Rents:

  • In early periods, corporate purchases led to lower rents and sales prices (due to more rentals).
  • During COVID, both rents and prices went higher in affected neighborhoods, but it's unclear if this was caused by investors or broader market shifts.
    • Quote:

      "During COVID... that's one of the technical ways that we would describe it: banananess." — Caitlin Gorbach (16:04)

• Effectiveness of Order:

  • The order does not ban purchases, but discourages them by ending mortgage guarantees for big investors and signaling antitrust scrutiny.
  • Skepticism: Big Wall Street landlords usually buy homes in cash, so removing mortgage guarantees (Fannie/Freddie) may have limited impact.
    • Quote:

      "I don't think they're using mortgages nearly as often as you or I would." — Caitlin Gorbach (18:12)

• Overall Assessment:

  • These firms aren’t a big enough part of the market to “move the needle” much for most Americans, except possibly in certain localized markets.
    • Quote:

      "They're not a big enough share of the market to really move the needle for most Americans." — Caitlin Gorbach (19:06)

4. Mortgage Rate Intervention: $200 Billion in Mortgage Bonds

• Announcement: Trump administration instructing government-backed institutions to purchase up to $200 billion in mortgage bonds to lower interest rates on new mortgages.

  • Quote:

    "I've instructed government-backed institutions to purchase up to $200 billion in mortgage bonds to bring down interest rates." — Donald Trump (22:17)

• How It Works:

  • Increased demand for mortgage-backed securities lowers rates for new borrowers.
  • The plan triggered an immediate "announcement effect," with rates dipping by 0.2 percentage points.
    • Quote:

      "Just announcing this, Susan says, pushed rates down 0.2 percentage points. The markets adjusted immediately." — Erica Barris (24:41)

• Caveats:

  • Many other factors affect rates (e.g., geopolitical events).
    • Quote:

      "Mortgage rates went down a little after the White House announced Fannie and Freddie's plans and then went right back up a week after when Trump threatened tariffs on Europe over Greenland." — Nick Fountain (25:41)

  • Increased risk for taxpayers if Fannie and Freddie end up with bad debt.
    • Quote:

      "The downside is that Fannie and Freddie...are taking on additional interest rate risk." — Susan Wachter (26:05)

5. What’s Missing? Supply Side Solutions

• Most economists say the biggest problem is lack of supply—not enough homes being built.
  • Current policies only address demand (helping buyers, making financing easier).
    • Quote:

      "Both of these are demand side. We need to solve the supply side part of this equation. We need to build more homes." — Susan Wachter (26:53)

6. The Tension in U.S. Housing Policy

• Americans desire both affordable housing when young and rising housing wealth as they age—these goals are at odds.
  • Quote:

    "We as Americans think we can have it all, that we can have lots of affordable housing when we're young and lots of housing wealth when we're old. And those two things...are in tension." — Caitlin Gorbach (approx. 27:40)

7. Returning to James: Why Homeownership Matters

• Despite discomfort and sacrifice, James continues to save in Djibouti, dreaming of homeownership for reasons of autonomy, stability, and personal fulfillment.
  • Quote:

    "It feels like you're not in control of your own life when someone else is dictating how you live, where you live... I would love to build a catio for the cats." — James Lawrence (28:40)

Timestamps for Important Segments

• 00:55–04:12: James Lawrence’s personal housing journey
• 07:01–07:19: Trump’s approach—raising prices for homeowners
• 08:45–16:10: Interview with Caitlin Gorbach on Wall Street’s role in housing
• 17:30–19:27: Assessing the executive order's effectiveness
• 21:41–24:41: Explaining the $200B mortgage bond program with Susan Wachter
• 26:53–27:40: Economists’ supply-side critique
• 28:38–29:39: James’s hopes for homeownership

Notable Quotes & Memorable Moments

• "Shipping off to Djibouti to afford a down payment for a house sounds about right."
  — Nick Fountain (06:41)

• "During COVID... banananess."
  — Caitlin Gorbach (16:04)

• "We need to build more homes."
  — Susan Wachter (26:53)

• "I would love to build a catio for the cats."
  — James Lawrence (28:40)

Summary Takeaways

• Two main Trump administration policies examined: targeting large Wall Street homebuyers and lowering mortgage rates via a massive government bond purchase.
• Both actions may provide some short-term or localized help, but neither tackles the root crisis: not enough new homes are being built.
• The episode illustrates the complexity and tension inherent in U.S. housing policy—and the very real struggles faced by ordinary Americans like James.
• Real, lasting affordability likely depends on increasing housing supply, not just tweaking demand or investor incentives.