Real Estate Veteran Pens Open Letter To Donald Trump: 'Resurrecting Housing Will Require Innovative And Daring Solutions'

A mortgage industry veteran has proposed three solutions to address America’s housing crisis in an open letter to President-elect Donald Trump, challenging conventional approaches to market recovery.

President and founder of Highland Mortgage, Mark Milam, outlined a strategy focusing on tax incentives, lending reforms and pricing adjustments to combat what he describes as a “crash landing” in the housing market. His assessment, issued via HousingWire, comes as existing home sales have fallen to 1995 levels despite a 32% population increase since then.

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The first proposal calls for a temporary reduction in capital gains tax for investment property sales. With individual investors owning 14.3 million of the nation’s 20+ million residential investment properties, Milam suggests halving the capital gains rate could unlock much-needed inventory. His calculations indicate the measure could generate about $22 billion in tax revenue while increasing available housing stock.

“This could be a huge win-win-win (country, seller and buyer),” Milam wrote, proposing the program run from Q2 2025 to Q4 2026.

His second recommendation introduces “Premium Recapture,” which addresses lenders’ concerns about early mortgage payoffs. This mechanism would protect lenders against early prepayment losses, potentially leading to more competitive lending terms and improved affordability for borrowers.

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The third solution targets Fannie Mae and Freddie Mac’s loan-level price adjustments. Milam highlighted the agencies’ increasing profitability despite declining volume – Fannie Mae reported $4 billion in net income in the third quarter of this year alone. He argues for simplifying the adjustments, demonstrating how removing certain fees could reduce monthly payments by hundreds of dollars.

Milam also expressed concerns about Trump’s immigration policies potentially affecting construction labor. He referenced a 2024 Immigration Impact study showing 1.6 million undocumented immigrants working in construction, noting similar policies under previous administrations coincided with decades-low housing starts.

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The letter points to the severity of current affordability challenges, citing the Atlanta Fed’s Homeownership Affordability index at 71, well below the threshold for median-income families to afford median-priced homes.

With the national median income at $85,000 and required homeownership income at $120,000, Milam argues traditional solutions won’t suffice.

“Reestablishing affordability and resurrecting housing will require innovative and daring solutions,” Milam said, urging immediate action on what he terms America’s largest asset class.

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