Trump Hints at Letting Homeowners Write Off Their Houses to Level the Playing Field With Corporations
President Trump is teasing a potentially sweeping change to the tax code that could affect millions of American homeowners: allowing depreciation deductions on primary residences. The idea, floated during a high-profile appearance in Davos, comes as housing costs dominate voter concerns ahead of the November midterm elections and as the White House rolls out a broader slate of unconventional housing policies.
Trump Suggests Depreciation for Primary Homes
Speaking during a 90-minute address at the World Economic Forum in Davos, Switzerland, President Trump questioned why homeowners cannot claim depreciation on their personal residences while corporations and investors can deduct it on income-producing properties. “The crazy thing is a person can’t get depreciation on a house but when a corporation buys it, they get depreciation,” Trump said, adding that it was an issue worth thinking about.
While the remark stopped short of a formal proposal, it signaled openness to reworking a long-standing feature of the tax code in a way that could materially lower taxable income for homeowners.
Why Housing Costs Are a Political Flashpoint
Housing affordability has become one of the most pressing cost-of-living issues in U.S. politics. A poll conducted in December 2025 found that 87 percent of Americans believe securing affordable housing is difficult, with nearly half calling it “very difficult.” Those concerns are now shaping policy debates as both parties jockey for advantage ahead of the midterms.
For the Trump administration, easing housing costs has become a central pillar of its economic messaging, alongside efforts to curb inflation and boost household wealth.
How Depreciation Works Under Current Tax Law
Under existing rules, depreciation is limited to business or income-producing property, such as rental homes or commercial real estate. Owners can deduct a portion of a property’s value each year based on its “basis,” generally the purchase price plus qualifying improvements, spread over a set recovery period.
Primary residences are excluded, except for portions used for business, such as a home office. When depreciated property is sold at a gain, the IRS recaptures some of those tax benefits through depreciation recapture, increasing the tax bill at sale.
What a Home Depreciation Deduction Could Mean
If extended to primary residences, depreciation could allow homeowners to deduct a portion of their home’s value annually, reducing taxable income and potentially easing monthly financial pressure. Supporters argue it would better reflect wear and tear and recognize housing as a major household expense.
Critics, however, warn it could complicate taxes for everyday homeowners and lead to larger tax bills when homes are sold due to depreciation recapture, unless Congress also revises capital gains rules.
Tax Experts Point to Outdated Capital Gains Rules
Housing advocates say the current tax framework already disadvantages homeowners. Tax experts noted that the capital gains exclusion on primary residences; unchanged since 1997; has been eroded by inflation and rising home prices.
According to experts, updating housing-related tax provisions could strengthen the middle class, ease affordability pressures, and support broader economic growth, especially if paired with other reforms.
Trump “Not a Huge Fan” of Using 401(k)s for Home Purchases
While some in his administration support tapping retirement savings to boost homeownership, Trump has expressed reservations. White House National Economic Council Director Kevin Hassett said the administration is finalizing a plan to allow some 401(k) withdrawals for home down payments.
Trump, however, pushed back, saying he prefers keeping retirement accounts intact. “The housing market’s good, but the 401(k)s are doing much better than the housing market,” he told reporters aboard Air Force One, signaling skepticism about trading retirement security for homeownership.
Longer-Dated Mortgages Enter the Conversation
Trump has also floated the idea of longer-dated mortgages as a way to lower monthly payments and expand access to homeownership. Extending loan terms beyond the traditional 30 years; potentially to 40 or even 50 years; could significantly reduce monthly costs, making homes more affordable on paper.
Supporters argue such mortgages could help first-time buyers and younger households priced out of today’s market.
Critics counter that longer terms mean borrowers pay far more interest over time and could be locked into debt well into retirement, raising new financial risks.
Executive Order Targets Wall Street Homebuyers
In a move that aligns Trump with long-standing Democratic critiques, the president this week signed an executive order aimed at limiting large institutional investors from buying single-family homes. The order declares it U.S. policy to preserve single-family housing for individual families rather than Wall Street landlords.
The directive instructs federal agencies to restrict programs that facilitate investor purchases and to promote home sales to individual buyers instead.
DOJ and FTC Told to Scrutinize Big Investors
The executive order also calls on the Justice Department and the Federal Trade Commission to review acquisitions by large investors for anti-competitive practices in the single-family rental market. Regulators are instructed to prioritize enforcement against practices that may be driving up housing costs.
Federal agencies are further directed to give individuals priority over institutional buyers when purchasing foreclosed properties.
What Comes Next for Trump’s Housing Push
For now, depreciation for primary residences similar to commercial real estate remains an idea rather than a policy, with no formal proposal or legislative language released. Still, combined with actions targeting Wall Street investors, pressure on Fannie Mae and Freddie Mac to buy $200 billion in mortgage bonds, and discussions around unconventional mortgage structures, the administration is signaling an aggressive approach to housing affordability.
With voter anxiety over living costs running high, Trump’s housing agenda is likely to remain front and center as the midterm elections draw closer; and could reshape how Americans buy, finance, and pay taxes on their homes.
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Your Child Could Get $1,000 With a New Trump Account and Major U.S. Employers Pledge to Match It
JPMorgan Chase, Intel, Nvidia, IBM, Bank of America and Wells Fargo are among a growing list of major corporations pledging to match a new $1,000 government contribution to children’s investment accounts under President Donald Trump’s flagship “Trump Accounts” initiative. The announcements mark a significant expansion of private-sector participation in a program the administration says could eventually channel trillions of dollars into long-term savings for young Americans.
Your Child Could Get $1,000 With a New Trump Account and Major U.S. Employers Pledge to Match It
‘Too Big to Save’: Big Short Investor Michael Burry Issues Dire Warning on AI Mania
Michael Burry, the investor made famous by The Big Short, is sounding one of his starkest alarms yet; this time on artificial intelligence. Burry says the AI boom has all the hallmarks of a historic bubble and warns that when it bursts, the damage could ripple through markets and the broader economy in ways policymakers won’t be able to stop.
‘Too Big to Save’: Big Short Investor Michael Burry Issues Dire Warning on AI Mania
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John Dealbreuin came from a third world country to the US with only $1,000 not knowing anyone; guided by an immigrant dream. In 12 years, he achieved his retirement number.
He started Financial Freedom Countdown to help everyone think differently about their financial challenges and live their best lives. John resides in the San Francisco Bay Area enjoying nature trails and weight training.
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