Despite President Trump’s refusal to sign, the 21st Century Road to Housing Act has become law without his signature, marking the largest housing affordability bill in decades. This bipartisan legislation, aimed at making homeownership more accessible, includes over 40 provisions designed to encourage homebuilding and increase market competition for individual buyers. While the law introduces measures like capping corporate home purchases and streamlining construction processes, its ultimate impact on housing markets remains to be seen, given the significant influence of local regulations, builder sentiment, and fluctuating mortgage rates.
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The Senate has overwhelmingly passed a comprehensive housing affordability bill, marking a significant bipartisan effort to address rising costs. This legislation, the 21st Century ROAD to Housing Act, aims to streamline home construction and limit institutional investors’ acquisition of single-family homes, a key concern for voters. Negotiated by lawmakers across the ideological spectrum, the bill now heads to the House before reaching President Trump’s desk. This victory offers Republicans a tangible win on a critical economic issue, though it has been somewhat overshadowed by other headline-grabbing actions.
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The average long-term U.S. mortgage rate saw a slight decrease this week, falling to 6.48% for a 30-year fixed mortgage, offering some relief to potential homebuyers. This movement follows a period of rising rates, largely attributed to inflation fears spurred by the conflict in the Middle East and its impact on oil prices. Despite this recent dip, rates remain elevated compared to a year ago, contributing to a continued drag on the housing market, with home sales showing little improvement and mortgage applications declining. Nevertheless, some buyers are finding opportunities amidst a market with more available properties and falling listing prices.
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US mortgage rates have risen back above 6% after a brief dip below this key psychological threshold. This reversal is attributed to the impact of military strikes in Iran on financial markets, causing Treasury yields to climb contrary to typical safe-haven behavior during turmoil. While this week’s increase is modest, sustained conflict and rising oil prices could disrupt the downward trend in mortgage rates, potentially hindering efforts to alleviate the housing market’s “lock-in effect” despite recent affordability gains for buyers. Nevertheless, home sales remain sluggish, with a notable decline reported in January, even as median home prices continue their upward trajectory.
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Senate Democrats have introduced The American Homeownership Act, a bill aimed at curbing Wall Street’s influence in the housing market. This legislation proposes to end tax breaks and housing benefits for corporate landlords, reinvesting these funds into building new affordable housing and supporting American families in achieving homeownership. The bill also seeks to empower antitrust enforcers to prevent large-scale corporate acquisitions of homes that displace families and drive up rental costs.
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Contrary to predictions of a mass exodus following Zohran Mamdani’s mayoral victory, the luxury home market in New York City has seen a surge in sales. Data from real estate firms indicates significant increases in sales contracts for properties priced above $4 million in the month following the election. Experts attribute the market’s performance to factors like a robust stock market and record compensation on Wall Street, not to any “Mamdani effect”. Despite some initial hesitations, the anticipated flight of wealthy residents to Florida has not materialized, as the real estate market is still doing very well in New York City.
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Foreclosure activity in the U.S. is experiencing a rise in 2025, with October marking the eighth consecutive month of annual increases. According to ATTOM, there were 36,766 foreclosure filings in October, a 19% jump year-over-year, though still remaining low compared to historical levels. Experts suggest this increase reflects a normalization of foreclosure volumes as market conditions adjust, but overall risk remains low due to factors like low-interest mortgages and the positive equity of most homeowners. While states like Florida are seeing the worst foreclosure rates, there is no indication of a crisis.
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Home Depot announced that it would have to raise some prices due to tariffs on imported goods. The company’s CFO stated that while these price increases would be modest and not across all categories, they are a direct result of the Trump administration’s import taxes. Although sales increased, net income slipped, and the company anticipates a 2% decrease in full-year earnings per share due to economic uncertainty and high interest rates discouraging large home renovation projects. Home Depot executives remain optimistic that these large projects will resume in the future, driving improved financial results.
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Younger generations are finding it increasingly difficult to enter the housing market due to high mortgage rates and elevated home prices. Data from the National Association of Realtors (NAR) indicates that in 2024, older baby boomers and individuals aged 60 and over purchased a significantly larger share of homes compared to millennials and Gen Z. The median age of first-time home buyers has risen to a record high of 38 years old. While the American dream of homeownership seems out of reach for younger generations, experts predict that they will eventually break into the market, although the timing and financial implications remain uncertain.
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Real estate investors are increasing their share of U.S. home purchases, with nearly 27% of homes sold in the first quarter of the year going to investors, the highest in at least five years. This increase reflects a broader slowdown in the housing market, as rising prices and high borrowing costs deter traditional buyers. Investors purchased 265,000 homes during this period, a modest increase from the previous year, and are able to do so by utilizing cash or existing home equity. While mom-and-pop investors dominate the market, there are signs large institutional investors are scaling back purchases.
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John Q. Hosedrinker