​If you’re trying to understand why starter homes have vanished, why marriage and birth rates are falling, or why your kids can’t afford to move out, you won’t find a clearer guide than Dr. Emily Hamilton. Her latest piece in Governing, “To Support Families, Repair the Housing Ladder,” is a must-read. It makes a simple but devastating point: 

We’ve eliminated the low rungs of the housing ladder—and now we’re shocked people can’t climb it.

Starter apartments? Outlawed. Manufactured housing? Zoned out.SROs? Gone. Family-friendly rentals? Blocked by NIMBY politics. And now the U.S. is flirting with population decline for the first time ever. This conversation explains why—and what to do about it.

👉 Subscribe on vanceginn.substack.com to get shows and show notes in your inbox and follow my handle on X at @vanceginn for more pro-growth policy content that doesn’t pull punches.

​This Thanksgiving, I’m grateful to bring you a conversation that captures exactly why freedom matters so much for human flourishing. In this special holiday episode of the Let People Prosper Show, I sit down with Dr. Jason Sorens, Senior Research Fellow at the American Institute for Economic Research, whose work shows—again and again—that prosperity grows when government gets out of the way and lets people build, create, move, and thrive.
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We talk about housing affordability, zoning reform, migration trends, and the economic importance of local freedom. On this day of gratitude, Jason’s message is a needed reminder: America’s prosperity has always come from free people making free choices, not from bureaucratic micromanagement.

If you’re thankful for liberty, opportunity, and the chance to build a better life, this episode fits the moment perfectly.
For more insights, visit vanceginn.com. You can also get even greater value by subscribing to my Substack newsletter at vanceginn.substack.com. Please share with your friends, family, and broader social media network. 

(0:00) – Thanksgiving intro & guest bio
(3:00) – Why freedom deserves our gratitude
(9:00) – Housing affordability challenges
(15:00) – Zoning’s impact on opportunity
(21:00) – How government distorts prosperity
(27:00) – Private alternatives and innovation
(33:00) – What opportunity zones got wrong
(39:00) – Property taxes and civic accountability
(45:00) – Freedom in the 50 States
(51:00) – Gratitude, freedom, and future policy

Originally published at The Daily Signal. 

The federal government’s grip on America’s housing finance system is contributing to the very affordability crisis it claims to solve.
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Fannie Mae and Freddie Mac, two government-controlled mortgage giants, now back more than half the $16 trillion residential mortgage market. While they don’t issue loans directly, they purchase mortgages from lenders and securitize them, funneling credit through a government-directed system that distorts prices, encourages risk-taking, and leaves taxpayers exposed.

Now, under the direction of Federal Housing Finance Agency Director Bill Pulte, the Trump administration has reopened the long-stalled debate over what to do with these entities.

President Donald Trump recently pledged to take Fannie and Freddie public again, and Pulte has said the administration is considering how to do so while still keeping them in federal conservatorship. This contradictory posture—suggesting privatization while maintaining government control—has left markets, lawmakers, and taxpayers uncertain.

That uncertainty matters because the status quo is already creating long-term damage. Fannie and Freddie have been in conservatorship since the 2008 financial crisis, when their collapse required a $187 billion bailout funded by taxpayers. That was supposed to be a temporary fix. Instead, they’ve become permanent fixtures of the federal housing system, with an outsized footprint that crowds out private competition and weakens the incentives for prudent lending.

Nevertheless, the Trump administration is right—privatization is the answer here. However, it must be real privatization. While the White House can take a phased approach to removing their conservatorship, eventually, it must come off. 

Critics of reform argue that ending federal backing could lead to higher mortgage rates. But those same critics ignore the long-term cost of the current arrangement. When lenders and investors operate with the understanding that the federal government stands behind their losses, the result is a mispricing of risk. The implicit guarantee that Washington will step in when things go south may keep rates lower in the short term, but it inflates home prices, misallocates credit, and leaves taxpayers holding the bag when the cycle turns.

The government’s role has also expanded in troubling ways. In January, the FHFA raised conforming loan limits to a record high of $806,500. These loans are now eligible for federal backing, meaning taxpayers subsidize million-dollar mortgages. That’s not a policy targeted at helping working families. It’s a distortion that inflates demand in already expensive markets and rewards politically connected interests at the expense of long-term affordability.

Meanwhile, the real challenge—supply—goes largely unaddressed. According to Axios, the U.S. faces a shortage of nearly 4 million homes. Easier credit does nothing to solve that. In fact, when supply is constrained, subsidizing demand only pushes prices higher. 

The solution isn’t more government-backed debt. It’s more homes. And that requires less regulation and more room for private capital to operate.

According to the National Association of Home Builders, nearly $94,000 of the cost of an average new home is attributable to local, state, and federal regulation. Those barriers choke off new construction, especially in places where demand is strongest. The answer isn’t more government-subsidized credit; it’s a freer, more responsive market.

We’ve already seen the benefits of private capital stepping in to increase supply. Private ownership of newly built rental units has grown sharply—by nearly 70% in some areas—bringing stability and options to markets that would otherwise be constrained. Yet instead of encouraging this private-sector dynamism, some in Washington want to shut it down. Lawmakers have floated proposals to ban corporate homebuyers, cap investor purchases, or impose new restrictions on private equity in housing.

These misguided efforts mirror the broader failure of Washington’s housing policy: punishing private capital while doubling down on federal programs like Fannie and Freddie that drive up costs and distort incentives. Instead of vilifying the private sector, policymakers should welcome its role in helping lower housing costs and increasing housing supply. Privatizing Fannie and Freddie would represent a great place to start.

Fannie and Freddie were never meant to be permanent arms of the federal government. Their continued dominance—underwritten by taxpayers and controlled by regulators—creates a housing system built on political priorities instead of market signals.

Privatizing them would correct these distortions. It would restore risk-based pricing to mortgage markets, reduce taxpayer exposure, and invite new entrants and innovation into the system. A phased release from conservatorship—paired with a clear plan to reduce implicit guarantees—would allow a competitive private housing finance market to emerge, while maintaining stability during the transition.

​Preserving the current model doesn’t protect affordability—it protects dysfunction. If the Trump administration is serious about improving access to housing and restoring fiscal responsibility, it must finish the job: end the conservatorship, get government out of the way, and let the housing market function like a market again.

​Why is housing so expensive in many cities—and is the government making it worse?

In this episode of the Let People Prosper Show, I interview Dr. Emily Hamilton, senior research fellow and director of the Urbanity Project at the Mercatus Center. We explore the big questions in housing policy: What drives rising costs? How do land-use regulations distort supply? And what reforms would make it easier for families to afford homes?

Dr. Hamilton is a leading voice on urban economics and has worked extensively to evaluate how government decisions, particularly at the local level, restrict housing development and make affordability harder to reach for many Americans. We break down the challenges of the modern housing market through a free-market lens, offering real solutions that expand opportunity, protect property rights, and let people prosper.

For more insights, visit vanceginn.com. You can also get even greater value by subscribing to my Substack newsletter at vanceginn.substack.com. 

(0:00) – Introduction to Housing Policy and Urban Economics
(8:41) – Understanding Land Use Regulations
(17:49) – The Role of Government in Housing
(26:49) – The Impact of Institutional Investors
(35:22) – Current Challenges in the Housing Market
(39:30) – Future Outlook for Housing

For many American families, homeownership—a cornerstone of the American Dream—is slipping further out of reach. Housing prices continue to rise, and even renting has become more expensive, leaving families feeling squeezed on all sides.

There are signs of hope. Several states are taking action this legislative cycle, exploring ways to reduce or eliminate property taxes. But more can and should be done—at both the state and federal levels—to make homeownership more affordable. Smart policy reforms won’t just benefit buyers; they’ll also help lower rental costs, easing the pressure on families across the board.

For more insights, visit vanceginn.com and get even greater value with a subscription to my Substack newsletter at vanceginn.substack.com.