Homebuilders are reportedly developing a plan to address prospective buyers' concerns about affordability with what they're calling "Trump homes" that would cater to first-time homebuyers.
Bloomberg, citing sources familiar with the matter, reported that homebuilders, including Lennar Corp., are developing a proposal that would have builders sell homes as part of a program backed by private investors who would help finance the program.
The outlet reported that one version of the proposal would see investors rent the homes to tenants. And, after three years, the tenants' monthly rental payments would count toward a down payment if they wanted to buy the home, though a person involved told Bloomberg the plan would be complicated to implement.
It's unclear what the scope of the program would be, although Bloomberg's report indicated that builders have considered building up to 1 million homes, which would amount to over $250 billion in housing.
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Homebuilders first discussed the proposal with the Trump administration last year, though many details haven't been finalized, according to Bloomberg's report. The outlet reported that one of its sources indicated that private investors wouldn't bear initial losses, although many details are still in flux.
Lennar declined to comment on the reports of the company's planning.
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Federal Housing Finance Agency Director Bill Pulte said in an appearance on FOX Business Network's "Making Money with Charles Payne" that the administration isn't considering the plan as it reviews a variety of proposals to improve the affordability of housing.
"The homebuilders are presenting a lot of different ideas," Pulte said. "I know that one of them or two of them had floated this 'Trump homes' idea. It's not something that we're actively looking at, but, look, we appreciate all ideas. All ideas are welcome."
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The proposals come amid a challenging housing market for Americans, as high home prices along with elevated interest rates make it difficult for first-time buyers to purchase their first home and also constrain supply. And existing homeowners are reluctant to sell and take on a new mortgage with higher interest rates.
A poll conducted for the National Association of Realtors by Public Opinion Strategies and Hart Research found that just 17% of voters think now is a good time to buy a home, down from 69% in 2013.
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Despite the headwinds affecting housing affordability, homeownership remains a key part of what voters view as the American dream, with 85% calling it an essential part of the American dream, an increase from 79% in 2013 with strong support across political groups.
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