Harris vs. Trump on Housing: Where Does Each Candidate Stand?

As the 2024 U.S. presidential election draws nearer, one of the hottest topics on voters’ minds is housing. With a shortage of about 4.5 million homes as well as record-high rental unaffordability, home price-to-income ratios, and homelessness, voters want to know: How will the next president improve the housing crisis?

For vacation rental owners, this question takes on even more weight, as the policies introduced in the next four years will not only impact them personally, but also professionally.

We should note that neither Kamala Harris nor Donald Trump has communicated any views or policies related to vacation rentals, specifically. However, their broader housing and economic policies could easily impact the vacation rental market—and thus your business.

So, to help you understand what to expect from the Harris and Trump Administrations when it comes to housing, we’re reviewing their top proposed policies here. Read, consider, and—most importantly—be sure to get out and vote!

Don’t see the form to download our vacation rental business plan? Click here.

Kamala Harris housing plan

While Kamala Harris has adopted some of the Biden Administration’s policies, she also released a press release in August outlining her agenda to lower costs for American families. The first section of this agenda—including three primary proposals—is dedicated to lowering housing costs and ending America’s housing shortage.

Let’s take a look at her plan.

Down payment assistance for first-time home buyers

If you’ve heard anything about Kamala Harris’s housing policy, you’ve probably heard this: That she plans to provide up to $25,000 in down payment assistance for first-time homebuyers.

More specifically, this assistance would be available for first-time homebuyers “who have paid their rent on time for two years,” and those who are also first-generation homeowners would be eligible for more generous assistance. This proposal would enable over 4 million first-time buyers to get down payment assistance over the four years she’s in office.

Potential impact on the vacation rental industry:

This down payment assistance will not, of course, be available to current or aspiring vacation rental owners, but that’s not to say it won’t impact them. Such significant down payment assistance may increase demand among first-time homebuyers, thus increasing competition and potentially driving up home prices. Granted, Harris also plans to drastically increase housing availability (more on that next), and if construction is efficient enough, demand might not outpace supply.

Expanding affordable housing

One of the pillars of the Harris housing plan is to expand affordable housing. And, as one of the main drivers of high housing prices is the widespread housing shortage, she plans to build 3 million new affordable housing units in the next four years.

To help make that happen, Harris plans to remove barriers that stand in the way of building new housing by:

• Introducing a first-ever tax incentive for building starter homes sold to first-time buyers, making it easier for renters to become homeowners.
• Expanding the existing tax incentives for building affordable rental housing. Harris has specifically mentioned the Low-Income Housing Tax Credit (LIHTC), which incentivizes the acquisition, rehabilitation, and new construction of rental housing targeted at lower-income households.
• Creating a new $40 billion federal fund to spur innovating housing construction, empowering local governments to fund solutions. This effort would also support innovative methods of construction financing and promote the design and construction of affordable rental/housing solutions.
• Cutting red tape and unnecessary bureaucracy. This would involve streamlining permitting processes and reviews to get homes on the market—and bring down costs—as soon as possible.

Potential impact on the vacation rental industry:

Typically, we’d expect home prices to decrease (or at least stabilize) with the construction of so much new housing—which would be a boon for aspiring vacation rental owners. However, it’s hard to say exactly how far this will be true, as the new supply would likely be tempered by many new first-time buyers entering the market, thanks to Harris’s proposed down payment assistance.

Regulating corporate home buying and price fixing

Harris’s plans don’t stop at the construction of affordable housing: She also wants to prevent corporations and major landlords from contributing to surging rent prices.

Specifically, Harris’s housing proposal includes plans to:

• Stop investors from purchasing single-family rental homes in bulk and then marking them up. This would involve passing the Stop Predatory Investing Act, which would remove tax benefits for major investors who make these bulk purchases.
• Prevent rent-setting data firms from price fixing to raise rents by encouraging Congress to pass the Preventing the Algorithmic Facilitation of Rental Housing Cartels Act.

Potential impact on the vacation rental industry:

Although these measures don’t directly target the vacation rental market, they could benefit vacation rental owners in the same ways they benefit anyone looking to purchase a home. For example, curbing large-scale institutional purchases would increase property availability for individual buyers and smaller investors, potentially creating more opportunities for those looking to invest in vacation rentals. Additionally, limiting corporate-driven rent inflation could help stabilize housing markets, making it easier for vacation rental owners to predict costs and revenues.

Donald Trump housing plan

Unlike Kamala Harris, Donald Trump has not outlined a specific housing plan leading up to the 2024 elections. However, he has proposed broader initiatives and economic changes that could indirectly impact the housing market. Reviewing potential policies he’s mentioned in interviews and rallies, as well as his first four years in office, also gives us an idea of what to expect.

Support for single-family zoning

Donald Trump has consistently voiced his support for single-family zoning, opposing the development of multi-family housing in residential areas. His administration had previously dismantled the Obama-era Affirmatively Furthering Fair Housing (AFFH) rule, which aimed to ensure communities promoted fair housing.

Potential impact on the vacation rental industry:

For vacation rental owners, especially those in suburban areas, this policy might preserve property values by limiting large-scale development. However, in tourist-heavy urban areas, this could restrict the supply of housing, maintaining upward pressure on home prices and rental rates.

Less regulation, more tariffs

Trump’s housing platform includes a push for deregulation, including reducing environmental reviews and other regulatory hurdles that slow down construction projects. He has also advocated for tariffs of 10-20% on all imports, with tariffs of 60% or more on imports from China.

Potential impact on the vacation rental industry:

Like Harris’s plan to remove unnecessary bureaucracy and red tape, Trump’s call for deregulation could speed up the construction process, helping to stabilize home prices as quickly as possible. However, reduced environmental protections (which Trump has hinted at) could come with the tradeoff of making certain vacation rental destinations less desirable in the long-term.

While Trump’s goal in implementing tariffs would be to promote U.S. manufacturing and generate government revenue to fund other initiatives, many economists agree that tariffs would actually drive up prices for consumers. So, the end result here could be more expensive construction materials, contributing to higher home prices.

See also: Short Term Rental Regulations: Laws, Licenses and Taxes

Deportation

Trump tends to go big or go home, and in this case he’s decided to encourage both with a proposal to deport millions of illegal immigrants in what would be the largest deportation program in U.S. history.

Potential impact on the vacation rental industry:

How is deportation related to housing? Trump has argued that mass deportations will reduce demand for housing, thus lowering costs.

However, there is scant evidence that illegal immigration is driving up housing costs. In fact, experts agree that other factors, including the slowdown in residential construction, are primarily responsible for driving housing prices.

There’s even some reason to believe that mass deportation could jeopardize the country’s housing market because of the significant number of mortgages that would be affected. According to a 2017 report by the Center for Migration Studies (CMS), 1.2 million households with undocumented residents have mortgages. Some of these households are what the CMS calls “mixed-status,” meaning they consist of both U.S. citizens and undocumented residents. In these cases, undocumented residents may be contributing to mortgages held by U.S. citizens, but it’s also possible for undocumented residents to apply for loans through options like the ITIN mortgage.

There’s also much concern about how mass deportation would impact construction, since an estimated 14% of U.S. construction workers are undocumented. Removing that labor could disrupt construction across the country, impacting the nation’s capacity to build new homes.

Trump’s housing policies during his first term

With Trump, we also get the opportunity to look to his previous four years in office for signs of what may be to come. Here are some key housing-related highlights from Trump’s first term:

• Congress rejected multiple of Trump’s budget proposals for the Department of Housing and Urban Development (HUD).
• All four of Trump’s presidential budget requests included plans that would increase rent by 40% for around 4 million low-income households.
• Trump’s budget requests also proposed eliminating housing programs such as the Community Development Block Grant, the HOME program, and the Low-Income Home Energy Assistance Program (LIHEAP).
• The “Opportunity Zones” Trump authorized in the 2017 Tax Cuts and Jobs Act (tax incentives for investing in real estate and businesses in low-income communities) have seen mixed outcomes.

Federal lands for housing development

Both Trump and Harris support opening up federal lands for housing development, which would involve selling the land for construction and—at least in Harris’s case—requiring a certain percentage of it to be developed for affordable housing. While neither candidate has provided extensive details, this plan could lead to new housing opportunities in previously undeveloped areas.

Potential impact on the vacation rental industry:

For vacation rental owners, new developments on federal lands could create competition if these areas become attractive destinations, but they might also present new investment opportunities if zoning allows for vacation rentals.

See also: The U.S.’s Best Short-Term Rental Markets for Investing (2024)

Looking ahead

So, which candidate’s policies are best for vacation rentals, the housing market, and (lest we forget) the nation at large? Will Harris’s plan for a more active government role in promoting affordable housing and limiting corporate home buying, or Trump’s plan for deportation, deregulation, and single-family zoning, prove more effective?

We’ll leave that to you.

Whoever you choose and however things go, we wish you luck over the coming months. And, once again, don’t forget to get out and vote!

Don’t see the form to download our vacation rental business plan? Click here.