Could Trump Use a National Housing Emergency to Sell Federal Lands and Would It Even Help?

Americans are struggling to afford homes. People in their prime homebuying years are being squeezed out of the market because wages haven’t kept up with home prices, pushing the average age of today’s homebuyer to a record-high 56. And although mortgage rates are hovering near one-year lows, providing at least a little relief, it’s likely not enough to unlock enough supply to meet a 4.7-million home shortage. Even with a recent Fed rate cut, stagnant wages and creeping inflation are both hindering a lot of pent-up demand.

It’s no wonder, then, that President Trump has floated the idea of declaring affordable housing a national emergency. Pressure is coming from all quarters, and it may take bold (if controversial) action to move the needle on this problem.

But what sort of power could declaring a “housing emergency” give the current administration? Could Trump use the opportunity to sell federal lands for residential development? It’s not out of the realm of possibility. The real question is, would building homes on federal land ease the supply crunch, or cause new and more challenging problems?

Can Trump Sell Off Federal Lands? Perhaps.

More than a quarter of land in the U.S. is held and managed by the federal government – a hefty 640 million acres. Most of it is managed by the Bureau of Land Management (BLM), and 90% of it is located in the West (or Alaska).

The West is also where a disproportionate percentage of the U.S. population is experiencing a crisis of housing affordability.

“The rise of prices faster than incomes in many major Sunbelt markets is absolutely real,” said Joseph Gyourko, a professor of real estate at the University of Pennsylvania’s Wharton School of Business. “It’s becoming a more national problem, and it’s way more widespread than I would have thought.”

Rising population and Restrictive zoning policies constrain the existing number of homes, driving the median price of a home in Western states to nearly $600,000, or more than 1.4 times the national average of $410,800 according the the St. Louis Federal Reserve.

Selling federal lands seems like an easy decision: build more homes, create more supply, and demand (and prices) will fall.

Legally, though, it’s not that easy.

Trump could not use his authority to issue an executive order to sell federal public lands, according to Daniel Rohlf. He’s Professor of Law and Of Counsel at Earthrise Law Center, the environmental legal clinic at Lewis & Clark Law School in Portland, Oregon.

“An executive order would not be sufficient to sell any federal public lands. Transferring lands that are owned by all citizens of the United States to another owner would require authorization from Congress,” Rohlf said.

At the very least, “there would need to be conditions on any land transfers to ensure that land was used for affordable housing or starter homes, rather than just sold to developers to build expensive properties,” he said.

The Potential Upside

Still, some developers and market advocates argue that selling federal land could open new opportunities, increase supply, and drive down costs.

“The federal government is the largest landholder in the entire country. There’s no reason why some of that land cannot be carved off to create new housing,” said Justin Pogue, a real estate investor and asset manager based in Dallas, Texas. “Of course, we're going to keep the national parks and those recreation areas, absolutely. But [some of] that land is not even really being productive in the ways that it could be.”

Eric Brotman, CFP, advises high-net-worth clients in his Baltimore, Maryland, advisory firm. As a longtime resident, business owner, and advisor in the congested East Coast, he’s seen firsthand the need for more wide-open spaces for housing development, and he believes there’s potential in the idea.

“If federal land is sold, two things will happen,” he said. “First, there’d be a cash infusion to the federal budget, and second, tax receipts from property tax. That’s a win.”

But just because you make land available doesn’t mean you’ll get a real community, he said. “You can’t just pop a house up somewhere and expect it to be a win.

“In real estate, the three things that matter most are location, location, location. If the land is in the middle of nowhere, it won’t solve anything. But if it’s near existing infrastructure—schools, hospitals, grocery stores, jobs—that could be good for families and communities.”

The Limitations

One immediate concern is whether the federal lands in question are actually buildable, or even livable. After all, these lands are remote and, practically by definition, undeveloped.

“Less than 1% of federal public lands are within any reasonable commuting distance of a major metropolitan area,” said Rohlf.

Without utilities, schools, shopping, employment, police services, and medical care, you’re not building a neighborhood — you’re just building houses, Brotman said. “And those two things are very different.”

There’s also a concern that taking federal lands private will benefit only a wealthy few, and not the people who need relief. Without guardrails or constraints, “investors will scoop up a lot of this land, and they’re not necessarily going to build homes for families,” Brotman said. “They might hold it, speculate, or build luxury retreats. That’s not what middle-class America needs.”

What’s more, the idea of privatizing public lands is not generally a popular one.

“The vast majority of Americans don’t think [public lands] are unproductive. They love them,” said John Leshy, Emeritus Distinguished Professor of Law at University of California Law, San Francisco. “Polls for years show people across the West—Republicans and Democrats—want more federal lands better protected, not less. … I don’t know of any analysis that suggests that public lands can play any real role in solving housing problems,” he said. “The housing thing is just a crisis, an excuse.”

Rohlf expressed a similar concern. “Proposals to use transfers or sales of federal public lands as a means to solve the housing shortage in this country are much more of a sound bite rather than a solution,” he said.

Big-Picture Solutions May Require Smaller Decisionmakers

Housing affordability requires more than raw land – it requires holistic, multilevel solutions, Pogue said.

“Just because you make the land available does not mean that you’re going to get this holistic community that’s going to pop up in this location overnight,” he said. It would require developing new economic centers that could support the varied needs of new residents. It would also likely require changes to zoning and other key factors that are decided on the local level.

“Housing is all local,” Gyourko said. “Washington, D.C. doesn’t issue housing permits—states and municipalities do. What we’re seeing is markets becoming built out enough that they’re starting to restrict new development the way Bostonians did 40 years ago.”

The solution may be found even farther back in history.

“The vast majority of land across the country that’s zoned is zoned single-family,” Pogue said. “If that’s all you can build, you get low density and sprawl. At some point, cities will have to move up, not out—just like Manhattan shifted from two-story buildings to skyscrapers 200 years ago.”

These types of changes, such as requiring developers to include affordable housing, can be politically unpopular, “but that’s where meaningful solutions lie,” Rohlf said.

What It Means for Homebuyers

Many wonder whether declaring a national housing emergency would really produce affordable homes, or just more expensive ones in the wrong places.

“Are we talking about land that will be used for affordable housing for people that will live within a reasonable distance of jobs and shopping, or are we talking about land eyed by second-home developers and hobby ranchers? That’s really what we don’t need,” Rohlf said.

In that case, it may be best not to get your hopes up.

“I’m not guessing that the Trump administration wants to create what is historically called affordable housing,” Brotman said. “I think this is new housing stock, but not affordable housing by definition. Unless you flood the market with supply, prices won’t really move.”

Privatizing federal lands for development isn’t a quick fix, either.

“You can open up federal lands, but really, you’re talking about building cities from scratch,” Pogue said. “A faster solution may be converting underused commercial buildings in desirable areas into apartments—those places already have transit, infrastructure, and third places like restaurants and shops.”

Nuanced Problem Requires Nuanced Solutions

As with any discussion of the housing crisis, the truth is more nuanced than a sound bite. Real relief depends on local zoning, addressing cumbersome red tape for developers, and exploring alternative ways to increase the housing supply to meet demand.

“Pointing to the housing shortage as a reason to transfer large amounts of federal public land is really just using housing as a convenient political cover for long-standing efforts to privatize those lands,” Rohlf cautions. But doing nothing is not an option, either.

“I basically think any reasonable experimentation is worth pursuing,” Gyourko said. “Selling lots in Yellowstone is not reasonable, but I can imagine other federal lands being sold for housing development would pass muster. We don’t know—so let’s experiment and see if it works.”