Trump Administration Seeks to Address Housing Affordability Amid Fed Rate Hike

The Federal Reserve's decision to raise interest rates has put additional pressure on Americans struggling with housing costs. On September 16, 2026, the Fed increased the federal funds target range by a quarter percentage point, setting it at 3.75%-4.00%. President Donald Trump's administration is limited in its ability to directly influence this benchmark rate.

The administration can, however, address housing affordability through policy changes. One key area of focus is increasing the supply of homes available for purchase or rent. The shortage of affordable housing contributes significantly to elevated prices. The Trump administration has taken steps to remove regulatory barriers to construction, including Executive Order 14394, signed on March 13, 2026.

This order directs federal agencies to review regulations affecting residential construction and develop best practices for state and local governments. However, much of the nation's zoning and land-use regulation remains controlled by states and local governments. The administration can use federal programs, funding, regulatory guidance, and incentives to encourage jurisdictions to make construction easier and faster.

Another area of focus is promoting competition in real estate markets. The Justice Department's Antitrust Division has already pursued cases involving alleged anticompetitive conduct in rental housing. Regulators are examining private listing networks, which can limit consumer access to housing information and raise competition concerns. The administration can scrutinize potentially anticompetitive practices in real estate and rental markets.