Trump seeks high home prices as study finds deregulation won't solve housing crisis

President Donald Trump has stated he wants home values to rise for current property owners, a position that appears to contradict his previous campaign pledge to slash the cost of new housing by half.

The housing affordability crisis remains a top issue in the United States, as housing costs now consume nearly half of the average middle-class family's income.

While both the Trump and Biden administrations, along with construction lobbyists, have advocated for loosening zoning regulations to increase supply, a recent study from several leading universities questions the effectiveness of that strategy.

The research indicates that rising home prices are primarily driven by growing income inequality. High-earning college graduates concentrated in major metropolitan areas are pushing prices beyond the reach of the rest of the workforce.

Even with a massive increase in housing supply, the study estimates it would take anywhere from several decades to more than a century for rents in cities like New York or San Francisco to become affordable for workers without a college degree.

Donald Trump’s recent rhetoric has inadvertently highlighted the central paradox of American housing politics: any policy effective enough to significantly lower prices would inevitably alienate the nation's largest voting bloc—existing homeowners. Because most Americans view their home as their primary financial asset, they are inherently incentivized to oppose any depreciation in value. This creates a political stalemate where elected officials instinctively avoid any intervention that might trigger a sharp market correction.

Within this framework, “zoning deregulation” has emerged as a politically convenient panacea for both parties. It frames the crisis as a supply-side issue that can be solved through free-market principles without requiring significant public expenditure, all while shifting the blame onto local "bureaucratic red tape." However, emerging research debunks the notion that deregulation is a silver bullet. The evidence suggests that the crisis is not merely a byproduct of a housing shortage, but rather a reflection of widening income disparity.

When housing prices are driven by the rising purchasing power of a high-income professional class, the construction of additional luxury units does little to assist retail or factory workers. This shift in the analytical lens moves the debate from "building more" to the structural reality of income inequality. It underscores a sobering conclusion: until the widening gap between the college-educated elite and the rest of the workforce is addressed, the housing crisis will remain a permanent fixture of the American economy, regardless of who occupies the White House.

The housing crisis across the U.S. is dealing a heavy blow to the Vietnamese community, especially in major hubs like California and Texas. Many families running small businesses, such as nail salons and phở restaurants, are finding that their household income simply cannot keep pace with skyrocketing home prices and commercial rents. Consequently, the dream of homeownership—once a cornerstone of the immigrant success story—is slipping away for the younger generation. They are caught in an economic squeeze where property values are inflated by the tech and finance industries while wages in traditional sectors remain stagnant. Analysis suggests that current policy proposals will offer little immediate relief for families struggling to maintain their footing in enclaves like Little Saigon.