The homebuilding industry faces a pivotal year as a new policy regime unfolds under President Donald Trump’s second term.

While uncertainty looms large over labor, trade, and regulatory policy, many homebuilding leaders are choosing to focus on opportunities – in an intensified "Let's-Make-A-Deal"-mode – rather than threats.

The prevailing sentiment among industry executives is clear: Take the president seriously, but not necessarily literally. For business leaders, the task is twofold: safeguard their organizations' ability to flourish while serving the households striving to achieve the dream of homeownership or rental stability.

In the long term, a natural selection-style competitive race over the next five to 10 years will favor organizations, business models, and operational systems that learn to build and market affordably priced homes faster, better, and at greater scale than their rivals.

Any Federal policy regime, however dramatically it declares and succeeds in carrying out its goals, may likely hold less sway in that long-term context than competitive outperformance.

A New Administration, Familiar Themes

Donald Trump's return to the presidency brings a mix of familiar rhetoric and bold policy ambitions. For the homebuilding industry, his administration’s stated priorities—deregulation, tax relief, and a renewed focus on energy independence—could offer opportunities to address long-standing challenges. However, the potential for volatility remains high, with key issues such as immigration policy, tariffs, and environmental deregulation poised to test the industry’s resilience.

The National Association of Home Builders (NAHB) has stepped into the arena, engaging with the new administration’s transition team to advocate for the stability and growth of the housing sector. Their efforts signal an acute awareness of the delicate balance between addressing policy shifts and ensuring the industry's ability to meet the nation’s pressing housing needs.

NAHB’s Top-Line Priorities for Trump 2.0

The NAHB’s priorities reflect the industry's pressing challenges and opportunities under the new administration, positioning homebuilders to thrive amid uncertainty. These priorities, outlined in early discussions with the transition team, aim to ensure the homebuilding industry remains a cornerstone of economic growth. Key focus areas include:

• Addressing Labor Shortages: Advocating for pragmatic immigration reforms to sustain workforce stability and meet the demand for housing construction.
• Improving Housing Affordability: Countering cost pressures by opposing tariffs that inflate material costs and supporting policies that reduce construction expenses.
• Streamlining Permitting and Regulation: Backing initiatives to cut red tape, speed up permitting processes, and lower compliance costs, enabling faster project delivery.
• Ensuring Access to Capital: Promoting policies that enhance lending opportunities for small and mid-sized builders, ensuring liquidity for ongoing and new development projects.
• Building Resilient Supply Chains: Encouraging material sourcing diversification to protect builders from trade disruptions and reduce dependency on single regions or suppliers.

These priorities underscore NAHB’s strategic engagement as an essential intermediary between policymakers and the businesses they impact. By championing actionable solutions in a domain many regard as non-partisan or bi-partisan, NAHB aims to provide builders with the tools that can help them navigate the challenges of 2025 and beyond.

Aligning Industry Action with Policy Priorities

Homebuilding leaders can use NAHB’s advocacy approach to align their operational strategies with broader industry goals. For example:

• Workforce continuity efforts, such as apprenticeship programs and visa renewals, will help address critical labor gaps exacerbated by stricter immigration policies.
• Supply chain diversification strategies, informed by past tariff battles, can ensure operational resilience and cost stability.

Labor: The Workforce Challenge

The industry’s reliance on immigrant labor has long been a cornerstone of its operations. Immigrants comprise over 30% of the residential construction workforce and significantly higher percentages in key trades like roofing and drywall installation. Trump’s proposals to end birthright citizenship, deploy the military at the border, and expedite deportations pose real risks to an already strained labor market.

Stan Marek, CEO of Marek Brothers, recounted the operational chaos caused by an ICE audit that forced him to fire long-tenured employees. His story is a stark reminder of how policy can directly impact the workforce and, by extension, the speed and cost of housing production.

Yet, not all leaders share Marek’s sense of alarm. Doug Bauer, CEO of Tri Pointe Homes, has expressed confidence that such policies may not materialize to their full extent.

As you look back on the Trump years, we had no issue with labor," Bauer noted, suggesting that the administration’s extreme positions often serve as negotiation tools rather than actionable plans.

For now, builders are hedging their bets, advocating for pragmatic immigration reforms to sustain workforce continuity.

Trade and Tariffs: Pressure on Supply Chains

Tariffs remain another wildcard. In his inaugural address, Trump reiterated his commitment to protecting American industry, including through new trade barriers. While this could disrupt supply chains for materials like Canadian lumber or imported fixtures, many builders have grown adept at navigating such challenges.

Gabriel Rodriguez, president of Miami-based A Customs Brokerage, highlighted the industry’s agility: “Kitchen sinks moved from China to Malaysia and now Mexico. Flooring moved to Ecuador.” Diversified supply chains and strategic warehousing are now essential tools for builders to manage costs and mitigate risk.

However, as Jim Tobin, CEO of the NAHB, cautions,

Any tariffs that raise the cost of building products are going to flow directly to the consumer.”

This underscores the delicate balance builders must strike between absorbing costs and maintaining housing affordability in a market already constrained by high prices and limited inventory.

Economic Tailwinds: Optimism Amid Uncertainty

Despite these challenges, many homebuilding leaders see reasons for optimism. Corporate tax cuts, deregulation, and a more dovish Federal Reserve under Trump could provide significant economic tailwinds. Lower borrowing costs, eased financial regulations, and streamlined permitting processes are all expected to unlock capital and reduce friction for builders, enabling faster project timelines and potentially boosting housing supply.

Tony Avila, CEO of Builder Advisor Group, forecasts increased mergers and acquisitions within the sector, driven by favorable fiscal policies and a strategic push toward consolidation.

The economic windfall from this administration will help the industry as a whole,” Avila stated.

Builders are also exploring innovative solutions to address systemic challenges. From adopting asset-light operating models to leveraging technology for greater efficiency, the industry embraces strategies that align with long-term resilience.

Trust as a Competitive Advantage

In an industry defined by complexity, trust emerges as a critical metric for success. Trust underpins every aspect of the homebuilding lifecycle from land acquisition to customer handover. The annual America’s Most Trusted Study underscores this, with Taylor Morrison once again ranked as the most trusted homebuilder, a distinction that extends beyond consumer sentiment to influence relationships with investors, trade partners, and local governments.

Trust isn’t merely a byproduct of operational excellence; it is a strategic imperative. High-trust organizations report lower turnover, higher productivity, and greater resilience—qualities that will prove essential as builders navigate a volatile policy and market environment.

Leadership Amid Uncertainty

For homebuilding leaders, the path forward lies in strategic adaptability. Success in 2025 will hinge on asking the right questions and making decisions that balance immediate risks with long-term opportunities:

• Will labor challenges demand a reevaluation of recruitment and training strategies?
• Can supply chain diversification offset potential tariff impacts?
• How will deregulation and economic tailwinds shape growth strategies?
• What investments in technology and talent will deliver the most value over the next five years?

Ultimately, the ability to thrive in this environment depends on a commitment to doing right by all stakeholders—owners, shareholders, customers, and employees alike. The challenge is not just to adapt to policy changes but to leverage them in ways that align with the industry's core mission: creating and sustaining communities where people can live, work, and thrive.

A Season of Opportunity

As the dust settles on the administration’s early days, one thing is clear: this is a time for homebuilding leaders to play offense. By focusing on trust, innovation, and strategic adaptation, the industry can weather uncertainty and capitalize on the opportunities. The year 2025 may be marked by challenges, but for those prepared to rise to the occasion, it also promises growth, resilience, and renewed purpose.