(Reuters) – Homebuilders are working on a proposal to develop nearly a million "Trump Homes" that would address the U.S. affordability crisis, Bloomberg News reported on Tuesday.
The initiative, still in early stages, would rely on a pathway-to-ownership model in which private capital finances construction of entry-level homes. Buyers would gradually build equity while living in the properties, according to people familiar with the discussions cited by Bloomberg.
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This calls for builders to sell entry-level homes into a pathway-to-ownership program allowing private capital funding of billions of dollars, Bloomberg News reported, citing sources familiar with the proposal.
Shares of major U.S. builders reacted sharply to the report. Lennar, D.R. Horton, PulteGroup, Toll Brothers, Taylor Morrison and KB Home all climbed between 5% and 7% in early trading, reflecting investor optimism that a large federally supported housing push could boost order books.
Industry analysts say the concept resembles rent-to-own programs but on a far larger, nationally coordinated scale. Supporters believe such a structure could help first-time buyers locked out of the market by high mortgage rates and elevated prices. Critics, however, warn that private-capital involvement may introduce complex financing terms that could still leave households vulnerable.
At the 1 million homes estimate, the program would likely deliver more than $250 billion worth of housing.
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Lennar declined to comment, while the other homebuilders and the White House did not immediately respond to Reuters' requests for comment.
The proposal comes at a time when U.S. consumers continue to face affordability challenges in an inflationary macro environment, dampening home sales across the country.
However, a White House official told Bloomberg News that the administration is not actively considering the plan.
Such a program would be complicated to implement and it's possible that it won't gain enough support to move forward, Bloomberg News reported.
The discussion follows recent moves by the Trump administration aimed at reshaping the housing market. Last month, U.S. President Donald Trump signed an executive order to restrict large institutional investors from competing with individual homebuyers in an effort to make housing more affordable.
Economists note that while limiting investor purchases could ease competition, it does not solve shortages of land, labor and materials that have constrained new construction for years. Mortgage rates hovering near multi-decade highs have further slowed activity, leaving many builders searching for creative demand-side solutions.
Market watchers caution that branding the effort as “Trump Homes” could politicize what is fundamentally a structural housing issue. Any federal involvement would likely require congressional approval, and details on subsidies, buyer qualifications and investor protections remain unclear.
Originally reported by Reuters.
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