Trump’s Housing Proposals Could Work, There’s Just One Big Problem

Dave:
President Trump’s housing policy is starting to take shape, as in just the last couple of weeks, the White House has announced several new policy proposals targeting many different parts of the housing market, all with an intention of improving housing affordability. And in today’s episode of On the Market, we’re diving into the Trump administration’s philosophy on housing policy, the potential impact of the specific proposals we know about, and how retail real estate investors should respond. Hey, everyone. Welcome to On The Market. I’m Dave Meyer, real estate investor, housing analyst, chief investment officer here at BiggerPockets. And as you probably know, housing and home ownership, they’re a big part of American culture. And right now, given the very low levels of affordability that we have in the market, it’s really on people’s mind even more than normal. Because even if you don’t work in this industry, it seems everyone is talking about, has an opinion on, and in most case, has an opinion on what is wrong with the housing market.
And sure, some people might be content with the housing market, but I think it’s fair to say that the general sentiment right now about the housing market is just negative. People are not happy with low levels of affordability. They’re not happy with low inventory. They’re not happy with high rents. And I think that is fair criticism. It is really not a good time in the housing market. And now, because of that, politicians are starting to take notice. And we saw this back in November when a couple of regional elections hinged a lot on housing policy, very notably, the mayoral race in New York, but it was happening all over the country, and it is now starting to get more and more attention on a federal level as well. In just the first few weeks of 2026, President Trump has said that he’s considering declaring a national housing emergency, and he has even started to share some policies that he’s pursuing in the near term to alleviate some of the considerable housing challenges that are out there.
Now, as we all know, much of housing is local, it’s handled at a town level or at a state level, but federal policy can play a large role in broad market trends. And as such, we’re gonna dive into this today on, on the market. We’re gonna figure out and talk about what the White House’s approach is to housing policy. Now, of course, as of now, we are light on details. Nothing significant has actually been passed or implemented yet, but we’re starting to get a sense at least of the philosophy that the White House is going after. They’re picking the levers that they’re going to try and pull to improve affordability. And just from that, we can learn a lot. We know what sectors of the market the president is intending to target, and we can really actually start to draw some conclusions, start thinking about how we as investors can adapt to what might be coming in the near future.
So in this episode, what we’re gonna do is we’re gonna cover briefly, first, the affordability challenges in the United States, talk about some of the stubborn challenges that we face. Second, we’ll talk about the White House’s emerging philosophy. We don’t know everything yet, but we can see some things about their philosophy, and I’m gonna share a lot about my thoughts about what might work, what might struggle to actually impact the market. And we’ll also talk about a couple policies we’ve gotten some details about, and we’ll dig into those and how they can impact you specifically. And then lastly, we’ll talk about strategy. What you should be doing right now, what you should be thinking about, and what you should be watching for in the coming months as more and more housing policy comes to a head. So that’s the plan. Let’s do it. First up, we’re talking about affordability.
If you listen to the show, you know, this is what I’ve been saying for three years, four years now, that it’s the biggest challenge in the housing market. The way affordability goes is the way the housing market goes. If it gets better, the housing market will get better. If it stays like this, we’re in for a long slog. And people know this. This is no secret. This is not some insider thing thinking about affordability. At this point, people are really feeling that the housing market is unaffordable. And it is, I should mention, it’s not really just feeling this is actually a measurable thing that is going on in the market. There are different ways that you can evaluate affordability in the housing market, but no matter how you look at it, it’s bad. Price to income ratios are pretty bad. When you look at rate adjusted affordability, so you factor in mortgage rates, also really bad, near 40, 50-year lows.
Rents are super high. It’s just, generally speaking, more expensive than it normally is to find shelter and kind of buy a lot. And of course, there are a lot of reasons to this. Everyone wants to blame someone, right? Some people wanna blame investors like all of us or Wall Street. Some people wanna blame Airbnb. Other people want to blame the Fed. Some people want to blame the lack of supply. The truth is, it’s a combination of things. I wish it was so easy that we could say it’s just this one thing that is causing the housing market to be so unaffordable. But unfortunately, that’s not the truth and that’s not possible. But I think I can actually narrow it down to maybe just three big picture things that are causing this affordability. First and foremost is since the great financial crisis, construction has lagged, and that has just created a housing deficit in the United States.
You’ve probably heard me say this, but depending on who you ask, there’s an estimated shortage of between three and seven million units in the United States. We just haven’t built enough homes to keep up with demand, and that in itself puts a lot of upward pressure on pricing. This is econ 101. When there is not enough supply to meet demand, prices go up. Now, at the same time as that, two other really important things happen that have negatively impacted affordability over the long run. The first is millennial demographics. There are just a lot of people who are getting to the home buying age during the last 10 or so years. That means there’s a lot more demand when there’s a lot less supply. That’s basically the perfect recipe for prices to go up. Now, the third thing, and, you know, you can pick which one you think is the most important, but this is a very big one, is that we just had really cheap money for a really long time.
Some people would say that we had artificially cheap money because the Fed kept rates really low. We had quantitative easing where the Federal Reserve was buying mortgage-backed securities. They were buying treasury bonds, which keeps mortgage rates lower than they would have normally been. And when you have that situation, artificially cheap money for a long time, that’s gonna put upward pressure on housing prices, right? Because all of a sudden, even though the prices are going up, it’s actually still pretty cheap for people to buy homes because mortgage rates are so cheap, and about 70% of people who buy a home use a mortgage. And so if you have the longest period of sustained low mortgage rates for, like, 12 years, that’s gonna push up prices. On top of that, the quantitative easing didn’t just keep mortgage rates low, it also added new monetary supply. It’s a fancy econ term for just printing more money.
And so when there’s more money floating around and there are cheap mortgage rates, people invest that money into real estate. And for a while it worked, right? Because as long as mortgage rates stayed low, it didn’t really even matter all that much. It mattered some, of course, but it wasn’t super concerning that prices were going up because mortgage rates were so cheap. But as we all know, starting in 2022, that cheap money went away, and all of a sudden we’re left with this situation where, oh my God, we bid up the price of housing so much, and now the support that we had, those low mortgage rates are now gone. Wow, now we’re in a really unaffordable situation. So to me, these three things, the lack of supply, millennial demand, and the cheap money for a really long time, that is the big picture stuff when you’re talking about affordability.
This is the stuff that really matters when we start to talk about policies that could be implemented to fix affordability. There are, of course, other variables too. Airbnb, it does take some supply. That is true. Institutional investors do own more single family homes than they did a decade ago. But if you just look at the math, these are frankly just kind of minor issues. They really aren’t moving the needle in a dramatic way. They have not caused the situation that we’re in. They make an already bad situation a little bit worse, but they are not the driving causes of low affordability, and that’s really important when we start to think about how do you fix affordability challenges. These things, they’re kind of on the fringes, they’re not the major issues. So all of that is the context for our conversation going forward about Trump’s housing proposals, which we’re gonna get to right after this quick break.
Stay with us.
Welcome back to On The Market. I’m Dave Meyer talking about President Trump’s emerging housing policy that we’re learning more and more about basically every day. Before the break, we talked about the big three variables in housing affordability. That’s low supply over a decade of cheap money and just boring old demographics, sounds boring, actually counts for a lot. Now, the Trump administration has acknowledged a lot recently the affordability challenges that exist in America and their proposed solutions are starting to take shape. You’ve probably heard of a lot of these. I’ve actually gone into details on some of these specific ideas on the show. You can do some deep dives if you wanna go back a couple episodes, but what we’ve heard so far is stuff like a portable mortgage, a 50-year mortgage. Most recently, we’ve heard about $200 billion in buying of mortgage-backed securities and potentially even a ban on quote unquote institutional investors.
Those have come from the White House. We’re also hearing other politicians, Senator Josh Holly of Missouri suggested on social media, maybe people should be able to pull their down payment out of their 401k or their retirement account without any penalties. So a lot of ideas are flowing around. I wanna make clear none of this has happened yet. These are just ideas. But to me, as I look at all of these ideas, a theme, an important theme, is starting to emerge. It is what it would be known as demand side policy, because we all know in economics, right, there is supply side, how many houses are for sale, and then there’s a demand side. How many people want to buy a home and can actually afford to buy a home? And before we go on, I just wanna clarify the word demand in economics. It sounds like it’s just who wants to buy something.
It’s not actually what it means. It means who can buy something, but also who can afford that thing at the same time. And so when you look at the ideas that are being float around, what we’re seeing are demand side ideas. It is true that there are plenty of people who want to buy homes right now. The challenge is that they can’t afford it. And so what the president and other politicians seem to be mostly proposing is helping people buy homes. Let’s just look at the policies that we’ve talked about so far, portable mortgages, 50-year mortgages, buying of mortgage-backed securities, raising money from retirement accounts. All of this is aimed at stimulating buyers. The whole goal of these ideas is to improve affordability by making it easier, or at least a little bit cheaper for buyers to pay for that limited supply that we have.
Now, each of these ideas might move the needle a little bit more. Each of them, I think, personally have zone merits. I obviously have my opinions about each of these idea, but generally speaking, all of them are designed to do the same thing. So let’s talk through them and see how these might impact the market. First up is portable mortgages. I did a whole episode on this. Not gonna get into it here, but I think there’s a near zero chance that this happens in a way that people think there is almost no feasible way that people who have existing two and 3% mortgages are going to be able to take that to a new home. It would just undermine the entire way that mortgages work in our country. Maybe in the future, portable mortgages will exist, but you would have to originate that loan as a portable mortgage.
I think there’s truly no chance that this is going to happen in the way people are hoping for. If it did, and I’m wrong, great, that would be awesome, but I really just don’t think that’s going to happen. But let’s just say on its face, because we’re talking about the philosophy here, this would be a demand side idea, right? It’s not creating new supply. It might help break the lock in effect. That could help. But basically the idea is there’s not a lot of movement in the housing market. Noah would help people move and free up some inventory and maybe get some activity, some transaction volume back to the housing market. If we let people take that cheap money that we gave them for 12 years to a new home, that’s mostly a demand side policy. What about a 50-year mortgage? This one doesn’t even have that secondary benefit of supply, but this is just a straight up demand side, a policy aimed at lowering the monthly payment for home buyers, which could improve affordability.
We’re not gonna get into the details of this, but over the long run, obviously that would mean a lot more interest for people, but it would lower their monthly payments, not by as much as you would think, but it would lower people’s monthly payments a little bit, and that can improve affordability. Again, demand side support. What about a ban on institutional investors? If you did ban them, you would probably have lower competition. You might even have higher inventory. And actually, I’ve gone on the record and said that I think this one could help. I don’t think it’s gonna help nationally because institutional investors only own two to 3% of homes in the whole country anyway, but there are markets like Atlanta where they own 25% of the market or places like Jacksonville or Charlotte where they are super active. And if they stopped buying, and this, you know, we don’t know the details, but if this policy actually was designed in a good way, it could increase inventory and help a little bit in those markets.
I also kinda like this idea because I think it could prevent a problem that isn’t really that big of a problem right now from getting worse because as we’ve been talking about this whole episode, housing is unaffordable to the average American. But these big hedge funds, they can self-insure. They have access to cheaper debt than you or I do, and so they might actually be able to increase their buying at a time where it’s really unaffordable for Americans. So the idea of preventing them from doing that and taking that from two to s- percent to 4% or 5%, I think that might be a good idea. And while this can help inventory, it is still fundamentally a demand side help because it is not increasing the total supply of units that we have in the country. So again, more demand side stuff. What about the $200 billion in mortgage-backed securities?
That is definitely a demand-side thing, right? We already saw that after that was announced, it lowered rates by about a quarter of a percentage point. We’ve probably seen most of the benefit of that, so don’t expect a lot more declines just from that announcement alone. So this is something that can work and actually improve affordability in the short term. I like that the idea is doing this with real money, not true quantitative easing. They’re not creating money out of thin air to go buy these mortgage-backed securities. Instead, what they are doing is taking money that Fannie and Freddie May have, profits that they’ve earned, and they’re using that. So I do like that. But again, fundamentally a demand side thing, they’re trying to make mortgage rates lower because Fed action alone isn’t going to do it, but if you go out and buy mortgage-backed securities, that is a direct way to lower mortgage rates as we’ve been talking about a lot on this show.
Now, these are just a couple examples. We’re probably gonna see more in the next couple of weeks, but all of these ideas are trying to stimulate demand. Now you’re probably wondering, I’m making a big deal about this, right? I’m talking a lot about demand. Is that a bad thing? Like, is there a problem with demand side stimulus? No, I don’t think fundamentally there is a problem with demand side stimulus, but the way I come out on this is that if you only do demand side support without doing the other thing, without trying to figure out that third big variable, right, that supply side challenge, this could actually backfire. Now, it might help in the short term, but it could backfire long term. Demand side support does make things cheaper. That can get more people into the market today or tomorrow, but that induced demand just pushes up housing prices over the long run.
And then whether it’s six months from now or 12 months for now or three years from now, things are just unaffordable again, right? Because what would normally happen if you did nothing is the market would start to correct, right? It’s so unaffordable that sellers have to lower their prices. But if we just give demand side support, then more people will come into the market, prices won’t go down, and sure people might be able to buy a couple homes for a couple years or months, whatever, while that stimulus lasts. But as soon as that stimulus gets taken away and it usually gets taken away at some point, then we’re actually not even in the same position. We’re in a worse position because housing prices went back up. So it’s not like demand side alone is just a bandaid, it can actually make things worse. Now, we need to be clear that none of the policies being floated right now are even in the same universe as quantitative easing.
Again, that’s the idea of the Fed going out and buying mortgage-backed securities in treasuries, creating money out of thin air. That made housing prices go up so much, and none of the policies that are being floated right now are even in the same universe in terms of scale. Quantitative easing made things artificially cheap, so prices went up like crazy, but even though the scale is different, the idea is the same. You are making things artificially less expensive, which puts upward pressure on the pricing. Now, don’t get me wrong, I am not in any way opposed to short-term fixes. I know that it is a real struggle out there, and if the government is thinking about ways to make it more affordable for people to live, I am all on board with those kinds of things. But they need to be paired with supply side improvements.
As I said, at the beginning of the show, the biggest issues that cause the situation that we’re in are demographics, cheap money, and low supply. So if all we do is add cheap money and don’t fix the low supply, we can’t really do anything about demographics, right? Then it’s not gonna fix this in the long run. So we need to address supply. We can address supply. It is not easy. I admit that it is difficult to address supply, but it can be done. So if it were me, if I had the opportunity to design a perfect fix to affordability, which of course is not politically or economically feasible, I know, but if I just had a magic wand and I could design a way to get us from where we are today to a better housing market, what I would do first is stimulate supply.
We need more houses. That is just the way to do it. That would, could be through government grants, public-private partnerships, trying to bring down the cost of construction, whatever it is, we need more houses, but that takes years. So in the meantime, I do think you could use demand side support to make things better soon while that supply comes online gradually. Now, unfortunately, I don’t get to wave that magic wand and housing policy is really difficult. And so what we’re seeing right now is just the demand side stuff without the supply side fixes. Of course, we may see more, right? I’m just evaluating this in the middle of January, right? We may see more supply side ideas come soon. We’ve heard about the idea of, like, opening federal lands to building. Personally, I’m skeptical that that’s going to work. These are typically not places people wanna live.
They’re not great for housing, but we haven’t heard much else on the supply side. I think, frankly, we need a zoning reform, which is handled locally, not federally, but the federal government could provide incentives to states and local governments to do zoning reform. We need to reduce construction costs, which unfortunately are going in the wrong direction, and tariffs have actually sent construction costs higher in the last couple of months. So color me skeptical, I don’t think we have a long-term fix right now, at least among the policies we’ve heard about so far. And in fact, I think all this demand side support is kicking the can down the road and could actually make the affordability challenges last even longer. And I know as a real estate investor, this might sound crazy or people might not agree, but I think the best solution is letting the market correct.
Like, that is the natural thing that the market is supposed to do. When it is unaffordable, people should not buy homes that puts sellers in a bind and they have to lower their prices and that restores affordability. We’re already starting to see this. Prices are starting to come down in many markets. Affordability has improved four out of five months. What we need is prices to come down while rates come down slowly and while wages rise. That is the recipe for improving affordability. So if what we do instead is just stimulate demand, pricing could accelerate again, which would just make the long-term affordability issues worse, even if it provides a short-term respite for buyers. And I just wanna say, I see this all over the place. This goes across both parties. We’re talking mostly about federal policy here, but I look into this stuff a lot, and honestly, you see it everywhere.
Politicians, just generally speaking, look for easy solutions that can make things better in the short run, and I don’t blame them, like, people want relief right now, but you don’t see a lot of politicians, or governments, state, local, federal, whatever, figuring out ways to actually solve the long-term challenge of supply, because it’s really hard. It’s really not easy. And so you have to put in a very concerted effort over a long time to fix it. And unfortunately, I just think the way our election cycles work in the United States don’t really incentivize politicians to look at long-term fixes, right? It might take eight years to fix supply. It might take 10 years. Most politicians are worried about how to improve the lives of their constituents, how to win elections in the next two to four years. And I’m not saying that politicians are necessarily doing these things malevolently, but they just naturally look at things that they can implement in a short term and they don’t think as much about long-term fixes, which is why we’re getting a lot of demand side ideas and not a lot of supply side ideas.
So that’s my rant. Back to the, the main theme. Personally, I would rather see the market correct, get back to a healthier, long-term position, but I don’t get to decide those things, so that’s where we are. And I do think what … I, I don’t know which one of these things are going to come to fruition, but it does seem likely we’re gonna see demand side stimulus in the next year, for sure. And as an investor, that’s important. There are tactical things or strategic things that you need to think about if we’re gonna get demand side stimulus, and we’re gonna get into that right after this break.
Welcome back to On The Market. I’m Dave Meyer. Before the break, I gave you my thoughts on the short versus long-term implication of demand side stimulus and a lot of the stuff that we are seeing being proposed at the federal level. Before we move on and talk about strategy, tactics, things you should be thinking about, just a reminder that none of the stuff we’re talking about has passed, but I think it still makes sense to start at least mentally preparing for demand side stimulus because it’s probably gonna come, even though we don’t know which specific policies are gonna make it through, right? We’re getting a sense of the philosophy the Trump administration is using, and we can start to at least think about the things that we’re going to do. Now, I, again, I hope we hear more supply side stuff soon, but as we said, even if President Trump and the White House come out with supply side ideas, it’s probably gonna take years for those things to come to fruition.
So as investors, I think the game really is to prep for some demand side support in 2026. So, what does that mean for your portfolio? I’ll start by just giving you a summary of my predictions for 2026. And when I make predictions, I don’t say, “I think the market’s gonna crash, the market’s gonna melt up, it’s gonna be flat.” As a trained data analyst, I think in probabilities. I recognize I don’t know what’s going to happen, but I’m a good analyst and I can say, “Hey, there’s a 50% chance that will happen. There’s a 20% chance that will happen.” It’s not super precise, but you have to accept the idea that there are a lot of variables out there. There are a lot of different things that can come in the next year, and we don’t know exactly what’s going to happen. And so as we enter 2026, I benchmarked things this way.
I think the most likely scenario going into this year before we knew about this stuff is, uh, the great stall. I’ve talked about it a lot on this show, but I think prices are gonna be relatively flat and I think rates are gonna come down slowly. Wages are gonna go up. That’s gonna get us back to affordability, but it’s gonna take years, two or three years. And I said, “I think that that scenario, about a 50-ish percent case, that’s the most possible, but there’s a 50% chance something else happens.” I said there was a 25% chance that there was a melt up, which is prices going up, and that idea was precisely from demand side support. I thought there’s a 25% chance we see significant demand side stimulus, and that’s gonna create a melt up in prices. I put that at about a one in four chance, set about a 15% chance of a crash, and then I always leave about 10% for a black swan situation, just something we don’t see coming, because that can happen, and frankly, the world feels pretty black swanish right now.
So, does this change? Does the information that we have right now change a lot? I would say a little bit. I actually still think this is roughly correct, because we don’t have the specifics, but even if these things, you know, the general idea of what is going to happen, I don’t think it’s enough demand side support to really cause a meltup. When I was talking about a meltup being a one in four chance, what I’m talking about is maybe quantitative easing, or significantly more mortgage-backed security buying, more bond buying than $200 billion. 200 billion is a lot, but in the mortgage market is tens of trillions of dollars, and so to really move the needle on that, I think that we would need significantly more of that stimulus. So when I came into the year, I was thinking a moderately declining market. I said, I thought my best guess for the national market was minus 1%, but I kind of said it might be anywhere between negative four to positive two.
And maybe this stuff, if it all comes true, we get a little bit higher, right? Like maybe instead of negative one, I think we go to flat. Or maybe instead of a minus four to a plus two range, I give a minus three to a three range, right? It might move the needle a little bit, but I don’t think it’s going to fundamentally change things that much. Why? Well, there’s two reasons. First and foremost, it’s just not enough. Like I said, we’re getting mortgage rates, you know, they’re at six and a quarter now, they’re a little bit above six. That is not enough to fundamentally change the housing market, people’s behaviors. It’s just not. The second thing is even if we do get a little bit more mortgage rate relief, we’re probably gonna see supply come back with demand. Inventory will go up. Now, I think this is the fundamental miss in all of the analysis I see out there or on social media, people saying, “Rates are gonna go down and prices are going to go crazy.” No, they might go up, but they are not going to go crazy.
And here’s why. When mortgage rates went up, did prices crash? No, because supply and demand both moved. When affordability changes, it doesn’t just impact demand, it impacts both. Rates went up in 2022. We did see a significant decrease in the number of people who are buying, but we also saw a significant decrease in the number of people of selling, and that has kept the market stable over the last couple of years. So why then would you assume if rates come down that it’s only gonna impact demand and not impact supply? That doesn’t make any sense. What we will see if rates come back is yes, more people will jump in the market, but so will more sellers. It will break the lock in effect. And I do think we might see more demand come back than supply and prices might go up one, two, three, four percent.
I don’t know, but the idea that if rates come down, we’re gonna see the market go crazy, I’m not buying it. I just don’t think it’s going to happen. So that’s why I still think the great stall is the most likely scenario, but I do think the other probabilities change a little bit. Trump is showing that he probably is gonna do a lot to prevent the market from crashing. And he has tools like quantitative easing. It’s not totally up to him, it’s up to the Fed, but, you know, he has influence and is trying to exert a lot of influence over the Fed, but I think he will do everything in his power to prevent the housing market from crashing. And so I think the chances of a crash, you know, I said 15%, maybe they’re down to like 5% now, right? I think it’s less and less.
I see a black swan. Let’s bump that up to 15%. There is a lot going on geopolitically. We have no idea. And now I think upside is probably closer to 30% because I think, you know, we’re buying mortgage-backed securities, paving the way potentially for buying of more mortgage-backed securities or bonds. Like it is possible that we start quantitative easing at some point this year to stimulate the housing where market, and so I’m putting the upside now at 30%. So for me, I am gonna shift my strategy a little bit, but not too much, and here’s what I’m personally going to do. I’m gonna stick with my plan for buy and hold. I said at the beginning of the year, I think it’s a good time to accumulate assets, and I think that’s still the case, and potentially it just got a little bit better, because prices are still a little bit soft, but the upside is getting a little bit better.
There’s still more inventory, but we might see some growth in the next couple of years from this demand side stimulus, and that’s all the more reason I wanna get into the housing market right now, while I still have good negotiating leverage before too much changes, we’re sort of in this slow period where I think it’s a good time to buy, so I’m definitely sticking with my plan for buy and hold. I actually think just in the last couple of weeks, the case for flipping and value add just got a little bit better. There is less risk in my opinion of market declines. We have potentially better affordability, which could speed up transactions, making it easier for disposition for selling the properties once you’ve renovated them without a much harder buying process. So at present, before we know the details of any specific policy, I’m getting a little bit more bullish.
I’m not, like, fundamentally changing how much money I’m putting into the market, but I am probably thinking a little bit more aggressively, wanting to act a little bit faster than I had been just a couple of weeks ago. Now, I have also freed up some money, though, in case there is even more demand side support. I have a little bit of money I’m holding on the side, because if we see quantitative easing, if we say, “Hey, the mortgage-backed security thing works, let’s do more of that, ” I think I’m going to buy more aggressively. Like I said, in November, I think the chance of quantitative easing are higher than I would like. I don’t think quantitative easing is a good idea, by the way. I should just mention, I don’t want that to happen, but if it does happen, I will buy more real estate because prices are probably going to go up.
So I, that is one other thing I am doing is freeing up some money. I sold some money from the stock market last year and I’m sort of keeping it aside. So if something changes and I spot a big opportunity because potentially a lot of demand side support are gonna shoot up housing prices, again, not from the current policies, but from future policies maybe this summer, I am keeping some money available for that. So just to summarize, I think buy and hold still an excellent thing to be buying right now. There’s more and better inventory. The risk of decline is starting to go down. I think we still have a good buying window, but a little bit higher upside than just a couple of weeks ago. So all those things, I, I think I’m sticking with my plan, but probably gonna be a little bit more aggressive.
I think buy and hold, I think potentially Burr. I think flipping all can work in this kind of market, and we’re just getting a little bit more confidence. And confidence to me matters a lot, but we are seeing that there’s probably gonna be some support in the market, and that can be helpful in the short term. Because I do wanna say that if we have … Again, I wanna remind people what we’re talking about here. If we see quantitative easing, or we see a ton of demand side stimulus, yes, it will probably push up home prices in the next couple of years, but the risk of a bubble also goes up. The risk of a crash in the future, that also goes up. So buy accordingly, buy good value, buy cash flowing rentals. Do not get in this COVID mindset of buy anything because it’s all going to go up.
Some things might go up. Everything might go up for a couple of years, but if that happens, the risk that they come crashing back down is high. So you want to have those great assets. The fundamentals right now, they’re different than they were during COVID. Good assets are always going to perform. These are things that you wanna hold even if prices go down in the future. Great assets, even if there is a bubble five years from now, those will still probably be cash flowing. They probably won’t go down as much as everything else. They’ll probably still be worth more after the bubble pops than they are today. So you really just need to be disciplined. Stick to the stuff that we keep talking about on the show of finding great assets and being really disciplined, negotiate well, buy deep, a lot of that still works.
But that’s a long way away, right? As I said, I don’t think any of the proposals right now are gonna create that kind of bubble, but I just kinda wanna give you the pros and cons of a quantitative easing situation because I hear a lot of people saying, “Prices are gonna go crazy if rates come down. I don’t think it’s that simple.” So hopefully this explanation helps you a little bit in your own thinking. I wanna clarify one more thing before we get out of here. I did say I’m gonna be a little bit more aggressive. I’m gonna move a little bit faster, but my approach to real estate right now is still risk off. As an investor, I think there are times to take risks and to take big swings, and there are times to just stick to strong fundamentals. Now is a time to strict to strong fundamentals.
The stuff we have heard from the president, it hasn’t even passed. It’s not enough to have a ton of confidence, but it does make me feel that the window is there to buy, but I’m gonna focus really on the fundamentals, the bread and butter, because frankly, just everything going on in the world right now, we don’t know what’s going to happen, and so I’m just gonna stay in risk-off mode, but if I find something good, I’m going to buy it. Frankly, I just think it’s a good time to accumulate assets. I think risk is a little lower right now than it was two months ago. Upside is a little bit higher, but since we’re still in an uncertain environment, I recommend that you plan accordingly. Now, could that change by summer? Sure, we might know a lot more about policy. We might have a new Fed chair, we might have a couple new Fed voters, things could change a ton by then.
But the point of the show is to help you adapt in real time, and I just want to share with you how I’m thinking about the housing market here in January of 2026. And of course, we will continue to update you as things change every single week here on On the Market. That’s all we got for you all today. Thank you so much for being here and for listening to this episode. I’m Dave Meyer. We’ll see you next time.