Major homebuilders considering providing 1 million ‘Trump Homes’ for first-time buyers

Several major homebuilders are weighing plans to band together to provide up to 1 million new entry-level houses for first-time buyers, branded as “Trump Homes,” according to a new report.

Lennar and Taylor Morrison are among the builders involved in the proposal, which would be funded by private investors, according to a Bloomberg report citing sources familiar with the matter.

The homes would be intended to provide a pathway to homeownership for first-time buyers, with one version of the plan allowing for monthly rental payments over three years to be applied toward a down payment, in a version of rent-to-own, the sources said.

The plan is reportedly tentative, and it is unclear whether it will gain critical support among builders or backing from the Trump administration, according to the report.

Although the plan would be privately funded, to be profitable for the builders, it might require changes to the mortgage guarantees offered by federally controlled mortgage giants Fannie Mae and Freddie Mac.

Industry players pitched the plan to the Trump administration last year, but a White House official told Realtor.com® that it was premature to speculate on whether the plan would gain federal backing.

The ‘Trump Homes’ would be intended to provide a pathway to homeownership for first-time buyers. Iriana Shiyan – stock.adobe.com

“President Trump pledged to put an end to Joe Biden’s inflation and affordability crisis, and the administration is constantly exploring new policy actions to do just that,” the official said on condition of anonymity.

“Until policy announcements are officially made by the administration, however, any reporting about potential action is pure speculation.”

Lennar declined to comment. Taylor Morrison did not immediately respond to a request for comment.

The reported plan for Trump Homes follows President Donald Trump’s call last fall for major homebuilders to dramatically boost construction to address the housing affordability crisis.

“I’m asking Fannie Mae and Freddie Mac to get Big Homebuilders going and, by so doing, help restore the American Dream!” Trump wrote on Truth Social in October.

By late December, however, Trump appeared to change his tune, shifting his emphasis from bringing home prices down to keeping existing homeowners “wealthy and happy” through record-high home prices.

Trump repeated comments in support of high home valuations at his speech in Davos last month, and in a Cabinet meeting last week.

“I don’t want to knock those numbers down, because I want them to continue to have a big value for their house,” Trump told reporters in the Oval Office.

“In other words, you create a lot of housing all of a sudden, and it drives the housing prices down.

“I don’t want to drive housing prices down. I want to drive housing prices up for people that own their homes. And they can be assured that’s what’s going to happen.”

By late December, however, Trump appeared to change his tune, shifting his emphasis from bringing home prices down to keeping existing homeowners “wealthy and happy” through record-high home prices. AP

The president’s shift in rhetoric raises questions about whether he would support a major new construction push from homebuilders.

Realtor.com senior economist Joel Berner also questions whether a specific rent-to-own pathway would actually benefit many first-time homebuyers.

“The reason this hasn’t been done before at a large scale is that rent-to-own just isn’t a very favorable proposition to buyers,” he says.

Rent-to-own makes sense only in specific circumstances where the buyer is unable to get a mortgage now, but will be in the future, and is willing to commit to a specific home upfront, says Berner.

The rent-to-own buyer is also gambling that the home’s value won’t decline over the lease period.

“It’s a small subset of the buyer population that experiences all these conditions,” he says.

“Building more homes is great for buyers, and a large-scale building boom will make homes more affordable. Just build them. Sell them or rent them out as builders normally would.”