‘Trump homes’ plan promises to help Americans buy houses in 3 years, but there’s one big problem experts see

Homebuilders Lennar Corp and Taylor Morrison Home Corp have proposed a new idea called “Trump homes.” The plan is designed to create a pathway-to-ownership program that helps entry-level buyers get a house. This new approach could make the housing market more accessible and affordable for everyday Americans.

The housing market is extremely difficult right now. Many people find it nearly impossible to afford a home, especially in high-demand areas. With the median home sale price at around $428,000, saving enough money for a full down payment is a major challenge for many families.

According to Newsweek, the proposal would flip the usual rental system. Entry-level homes would be sold through a pathway-to-ownership program funded completely by private investors. Buyers would move in as tenants, but after about three years, all their monthly payments would convert into a down payment on the house.

Private investors controlling the market could drive prices even higher

Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, explained the concept. “Renters would have the option after three years to purchase the home they’re currently living in and apply prior payments to the down payment on the property,” he said. This could help people who cannot save up the necessary funds upfront.

The builders want to focus construction on entry-level homes. Drew Powers, the founder of Powers Financial Group, noted that home builders usually find it “far more profitable to build a 5,000 square foot home with top-end finishes versus four separate 1,200 square foot starter homes.” 

The current administration is looking to private investment, not government subsidies, to change this trend. While the administration pushes various policies, Trump’s reconstruction plans face mixed reactions from different groups.

The project could be huge if approved. Builders have discussed that the idea could cover as many as 1 million homes, potentially providing more than $250 billion worth of housing. Lennar Chief Executive Officer Stuart Miller said they are “very well positioned to provide the affordable supply that the market needs when demand is ultimately activated.”

However, financial experts have serious concerns, and this is where the big problem appears. While the plan addresses the down payment issue, it greatly expands the role of investors as landlords. Kevin Thompson, the CEO of 9i Capital Group, struggled to see how this model improves affordability over time.

Thompson believes the proposal might actually “do more harm than good for many Americans.” Investors are always profit-driven, and Thompson pointed out that those costs rarely disappear. “They are typically passed through higher rents or purchase prices,” he said. If the system is poorly regulated, it could become a private version of failed public housing, with investors continuing to set high prices. Powers emphasized that the “devil is in the details, specifically the regulations around the initiative.”  

While Taylor Morrison expressed encouragement about the “thoughtful discussions” with the administration, White House officials have stated that the plan is not currently being actively considered by the Trump administration. The mention of an action plan to address affordable housing is promising, even if fine-tuning the details proves difficult. Meanwhile, a pro-Trump influencer faced unexpected consequences in an unrelated incident.