4 ways Trump wants to make America more affordable. Will they work?

By Tami Luhby, CNN

(CNN) — With affordability at the top of his domestic agenda for 2026, President Donald Trump unveiled in rapid succession last week a series of proposals aimed at making Americans’ cost of living less, well, costly. He focused on two major burdens — housing and credit card debt.

Trump has been on a tear lately, also throwing out vague ideas on reducing health care premiums by giving federal subsidies directly to consumers, instead of insurers, and on lowering utility costs by requiring that big tech companies, including Microsoft, pick up the tab for their data centers’ energy consumption, among other measures. Last month, he signed “Most Favored Nation” agreements with nine drugmakers aimed at reducing the price of medicine in the US and secured another two deals in recent days.

And, of course, he’s floated using some of the increase in tariff revenue to issue $2,000 rebate checks to Americans.

More proposals are coming, Trump teased in a speech Tuesday in Detroit that was billed as being focused on the economy. Later this week, he said, he will announce a health care affordability framework that will hold insurers accountable, lower drug prices and make prices more transparent. And he promised to “provide much more detail” about his housing proposals at the World Economic Forum in Davos next week “so that every American who wants to own a home will be able to afford one.”

It’s questionable whether Trump has the authority to enact many of these proposals on his own, despite his pronouncements on Truth Social. Several experts say he needs Congress’ buy-in for at least some of the measures, which would not be easy to obtain.

Notably, several of the ideas are contrary to Republican orthodoxy and have been pushed by lawmakers he often accuses of being from the “radical left,” including Sens. Bernie Sanders and Elizabeth Warren and Rep. Alexandria Ocasio-Cortez.

Even more importantly, experts have questioned whether his latest batch of ideas would really put a dent in the nation’s affordability crisis and help ease Americans’ struggles.

“Despite some real prioritization from the White House, it’s going to be a challenge to get enough traction on affordability that it really changes voters’ mindset,” said Tobin Marcus, head of US policy and politics at Wolfe Research who served in the Obama administration.

Here are some of Trump’s main proposals:

Cap credit card interest rates at 10%

Trump on Friday called for a 10% limit on credit card rates for one year, echoing a campaign promise he made in 2024. The cap would go into effect on January 20th, and companies that don’t comply would be “in violation of the law,” he told reporters on Sunday.

“They’ve really abused the public,” he said of the credit card companies. “I’m not going to let it happen.”

Such a limit, however, would likely make it much harder for Americans with lower credit scores to obtain credit cards, said Andy Laperriere, head of US policy research at Piper Sandler and economic policy adviser for former GOP House Majority Leader Dick Armey. Banks might also lower their limits or raise their annual fees.

“The economics of it just aren’t going to work,” Laperriere told CNN of the cap.

Currently, the average interest rate on credit cards is just under 20%, according to Bankrate, though some rates are much higher.

The banking industry echoed that view in their response to Trump’s demand, saying such a cap would “reduce credit availability and be devastating for millions of American families and small business owners.”

It’s unclear what law Trump is referring to that credit card companies would violate, and it’s doubtful Trump could enact this measure on his own, experts said. One vehicle he could try to use is the Consumer Financial Protection Bureau, but he is trying to defund and gut it.

The idea has the backing of Sanders and populist GOP Sen. Josh Hawley, along with Ocasio-Cortez, a Democrat, and GOP Rep. Anna Paulina Luna, who have co-sponsored legislation placing such a cap on credit card rates. Warren said Monday that Trump called her, and she told him a rate cap could pass “if he will actually fight for it.”

But GOP leaders on Capitol Hill have raised serious concerns about the impact on credit availability — with Senate Majority Leader John Thune saying Tuesday, “That’s not something I’m out there advocating for.”

Ban large institutional investors in single-family homes

Trump said on Wednesday that he is “immediately taking steps” to prevent large institutional investors from buying more single-family homes, calling on Congress to codify his proposal.

Though such large investors — those that own more than 1,000 properties — control more than 10% of single-family rental housing in a handful of markets, they represent a small percentage overall across the US. Plus, they are shedding their holdings, not buying additional homes, since real estate is no longer as good an investment as it was last decade because of the surge in prices, Laperriere said.

Rental properties are typically owned by small-time landlords, not Blackstone and other investment management companies, Marcus said.

Banning big investors from buying more single-family homes would not do much, if anything, to make homeownership or renting more affordable, experts said.

Regardless, the idea has support on both sides of the aisle. Senate Democrats tried to curb institutional ownership of single-family rental homes last year, and Warren has advocated for it for years.

After Trump’s announcement last week, several Republican lawmakers cheered the proposal and said they would introduce legislation.

Buying mortgage bonds

Another way Trump wants to make housing more affordable is to have the federal government, through Fannie Mae and Freddie Mac, buy $200 billion in mortgage bonds.

“This will drive Mortgage Rates DOWN, monthly payments DOWN, and make the cost of owning a home more affordable,” he posted on Truth Social last Friday. “It is one of my many steps in restoring Affordability.”

Since the announcement, mortgage rates have slid about 0.2 percentage points, which helps but it isn’t a game changer, experts said. And they may not fall much further once the bond purchases take place.

“I don’t think it is going to transformatively unlock the housing market or change voter perceptions of housing affordability,” Marcus said.

Though Trump has the authority to increase Fannie Mae and Freddie Mac’s portfolios, it’s not a popular move among some lawmakers and experts. Plus, it will make it harder to privatize the companies, as the administration has pushed to do.

Issue $2,000 tariff refund checks

Though he didn’t mention it in his speech Tuesday, Trump has also dangled sending $2,000 tariff refund checks to lower- and moderate-income folks to give them a financial boost.

The idea has sparked a lot of interest among Americans, but it’s not likely to happen for several reasons — including that the federal government isn’t bringing in enough tariff revenue to afford it, according to estimates from the Tax Foundation.

There not much appetite for this among GOP lawmakers, whose support would be crucial, Laperriere said. And such a payment risks reigniting the high inflation that was sparked by the Covid-19 pandemic stimulus checks and other programs.

Trump’s affordability playbook is similar to former President Joe Biden’s — attacking industries for high prices and proposing symbolic solutions, he said.

“There is no easy answer, period,” Laperriere said. “That’s part of the reason you are seeing these symbolic things.”

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CNN’s Ted Barrett contributed to this report.