‘I think everything is on the table,’ Treasury Secretary Scott Bessent said in a Labor Day interview.
President Donald Trump is thinking about declaring “a national housing emergency in the fall,” Treasury Secretary Scott Bessent has said.
In a Labor Day interview with the Washington Examiner, Bessent stated that the administration is considering a list of measures to bolster supply and cut housing costs, including possible tariff exemptions on construction materials. They are also studying tactics to standardize local building and zoning codes, the finance head said.
“We’re trying to figure out what we can do, and we don’t want to step into the business of states, counties, and municipal governments,” he said on Sept. 1. “I think everything is on the table.”
He added that the Federal Reserve potentially cutting interest rates this year would help improve housing affordability.
Investors overwhelmingly expect the Fed to lower the federal funds rate—a key policy rate that impacts business, consumer, and government borrowing costs—later this month. Mortgage rates typically track the 10-year Treasury yield, which is partially influenced by the Fed funds rate.
According to Freddie Mac’s Primary Mortgage Market Survey, the average 30-year fixed rate mortgage was 6.56 percent for the week ending Aug. 28, down 21 basis points from a year ago.
Bessent, meanwhile, acknowledged that the administration can employ policies to ensure more families can purchase a residential property.
“We may declare a national housing emergency in the fall,” he said.
So far this year, the president has declared several national emergencies, including those related to border security and economic threats.
On the 2024 election campaign trail, Trump vowed to open up federal land for housing development and slash red tape that he said was driving up costs.
State of the US Housing Market
The U.S. real estate market experienced a post-pandemic boom, driven by low housing inventories, surging demand, and near-zero interest rates that enabled homebuyers to secure extremely low mortgage rates.
Recent industry data indicate that the national housing market has since come to a standstill.
Last month, Redfin estimated that there were 36 percent more sellers than buyers, the widest gap since 2013.
“Homebuyers are spooked by high home prices, high mortgage rates, and economic uncertainty, and now sellers are spooked because buyers are spooked,” Asad Khan, senior economist at Redfin, said in the report.
This has prompted a growing number of sellers to delist their homes or opt not to list their properties on the open market. However, this has not led to a collapse in national housing stocks, with active listings rising 22 percent since January and exceeding 1.01 million.
Current inventories are at a more than five-year high, said Lawrence Yun, chief economist at the National Association of Realtors.
“The ever-so-slight improvement in housing affordability is inching up home sales. Wage growth is now comfortably outpacing home price growth, and buyers have more choices,” he said.
“Homebuyers are in the best position in more than five years to find the right home and negotiate for a better price.”
Median existing home prices rose 0.2 percent year over year in July to $422,400, the latest association data show.
Overall, according to Redfin statistics, the median home sales price in July increased 1.4 percent from the same period a year ago to $434,189.
Despite elevated home prices that have prevented the younger generation from achieving homeownership, the U.S. real estate market remains a significant facet of the country’s economic growth prospects, says Jeffrey Roach, chief economist for LPL Financial.
“As a major component within GDP, the housing market’s health is a key indicator of the broader economy,” Roach said in a note emailed to The Epoch Times. “Robust residential investment, including new construction and remodeling, stimulates growth, while a downturn can slow the economy significantly.”
If the Fed follows through on a rate cut at the September Federal Open Market Committee meeting, the monetary policy decision “could be a catalyst for homebuilders,” which would boost supply, Roach added.
Regarding upcoming economic conditions, Bessent expressed high optimism for the economic outlook next year. “I think we’re going to see a big economic pickup in 2026,” he said.
The Bureau of Economic Analysis revised its initial estimate of the second-quarter GDP growth rate to 3.3 percent from 3.1 percent. This is up from the 0.5 percent contraction reported in the first quarter.
Looking to the third quarter, the widely watched Atlanta Fed GDPNow Model anticipates 3.5 percent growth, up from its previous projection of 2.2 percent.
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