Trump Directs $200 Billion Mortgage Bond Purchase to Lower Housing Costs

President Donald Trump announced on Thursday that he has directed his representatives to purchase $200 billion in mortgage bonds, aiming to lower mortgage rates and make homeownership more affordable.

In a post on Truth Social, Trump stated that Fannie Mae and Freddie Mac, the two government-sponsored enterprises under federal conservatorship, have accumulated significant cash reserves. He attributed this to his decision during his first term not to sell these entities, a move he described as "a truly great decision, and against the advice of the 'experts.'"

Federal Housing Finance Agency (FHFA) Director Bill Pulte confirmed the directive, indicating that Fannie Mae and Freddie Mac would execute the bond purchases. Pulte emphasized the agencies' readiness, stating, "We have the capability, we have the cash to do it, and we are going to go about executing it very smartly and in a very big way."

Analysts have offered mixed reactions to the plan. Some suggest that the bond purchases could help narrow the spread between the 10-year Treasury yield and 30-year mortgage rates, potentially reducing borrowing costs. However, others caution that the initiative may not fully address the broader housing affordability crisis.

The announcement comes ahead of the November midterm elections, with the administration seeking to address voter concerns about rising housing costs.