According to a new analysis from NBC News, many of the counties that swung most dramatically toward President-elect Donald Trump this year were in America’s toughest housing markets – a reflection of how skyrocketing interest rates and a housing affordability crisis influenced the 2024 election. As Republicans look to tackle this issue through a free-market approach, Democrats remain stubbornly committed to dangerous socialist housing policies, setting up a showdown in the years ahead.
As NBC reports, “Across the country Tuesday, counties moved toward Trump by a median of 3.1 percentage points compared to the 2020 election.” However, in the top 10 percent of counties ranked most difficult for buying a home, “the median shift was 4.5 percentage points.”
Since Biden took office, 30-year fixed mortgage rates have soared from an average of 2.77 percent in January 2021 to a high of 7.79 percent in late 2023. That figure is currently still near 7 percent.
Inflation has also driven up home prices, with the median home costing about 25 percent more today than four years ago. As a result, 63 percent of Americans now say they can’t afford to buy a home.
Trump has promised to make addressing housing unaffordability a top priority in his second administration. His “Agenda 47” platform calls for opening limited portions of federal land for housing development, promoting homeownership through tax incentives, and cutting regulations that raise housing costs, along with lowering inflation. According to the National Association of Home Builders, excessive regulations account for up to 25 percent of single-family home costs and 40 percent of apartment development costs.
Trump’s approach relies on creating free-market incentives for builders and buyers alike, empowering families to earn their way to the American Dream. Kamala Harris proposed precisely the opposite approach, advocating for more government involvement in the housing market, including a proposal to give $25,000 to homebuyers that would’ve only further driven up prices.
Voters rejected Harris’s agenda at the ballot box, but congressional Democrats aren’t backing down. The “Homes Act,” recently introduced by Democrat Senator Tina Smith of Minnesota and Representative Alexandria Ocasio-Cortez of New York, is the left’s next grand scheme to “reimagine” American housing policy.
The bill allocates $300 billion “to establish an independent entity within the Department of Housing and Urban Development to acquire and maintain distressed real estate to stabilize communities and increase the supply of affordable housing, and for other purposes.” In other words, it’s an enormous expansion of federal housing to make the government the biggest landlord in the country.
The new federal housing authority Smith and Ocasio-Cortez propose would function as both a public bank and developer. Over the next 10 years, it would allocate $30 billion annually to fund a total of 1.25 million “affordable” housing units. Taxpayer-funded state guarantees will back the loans to buyers, further increasing to deficit.
The Homes Act mandates that new homes constructed under the program meet specific requirements, including that they are “permanently affordable” (whatever that means), “publicly financed,” “climate resilient,” and “protected from financial speculation.”
For “climate resiliency,” the new homes must feature super-insulated roofs and exterior walls, electric heat pumps for air conditioning and water heating, heat recovery systems, solar panel rooftops, photovoltaic glass windows, and all-electric appliances. Dedicated bicycle and electric vehicle infrastructure must be included to meet “minimum property standards.” The bill also mandates that the new housing authority have at least one “political officer” with expertise in “environmental justice.”
In short, instead of empowering Americans to make and keep more of their money to build or buy a home of their choosing, the Homes Act wants to keep housing unaffordable and force priced-out buyers into Green New Deal government nightmare homes.
Professor of economics Giambattista di Domenico, who advised former Italian Prime Minister Giovanni Spadolini, told me in an interview that, in effect, what Smith and Ocasio-Cortez are proposing is an ideologically driven, state-controlled real estate company disguised as an “agency.”
“This is not the answer to unaffordable housing, but a tremendous spending trap,” he warned, describing the bill as “a paradise for bureaucracy” but “a torment for American taxpayers.”
Dr. Esbjörn Ragnvaldsson, another expert I spoke with on the bill, said that it ignores the reality of problems facing the U.S. real estate market, including rising material costs and labor shortages. While the bill promises to throw billions of dollars at the problem, money alone won’t address underlying issues slowing new home construction in the first place.
The experts I spoke with for this column said that the best solution should be making homes more affordable for middle- and working-class Americans through lowering inflation, cutting regulations, and letting workers keep more of their hard-earned money, rather than further restricting their entry into the market as the Homes Act would do.
The Republican sweep earlier this month means that the Homes Act or anything close to it stands virtually no chance of becoming law anytime soon. But Republicans, particularly in the Senate, will still have to work with Democrats to pass any meaningful legislation on housing. They should be wary of liberal efforts to sneak in measures that would further undermine Americans’ ability to purchase a home of their own.
Ben Solis is the pen name of an international affairs journalist, historian, and researcher.
