Federal Impacts
New Executive Order Aims to Remove Regulatory Barriers to Housing
summary
- A new Executive Order directs the U.S. Department of Housing and Urban Development (HUD) to issue best practices for state and local governments covering streamlined permitting, by-right development for single-family homes, updated building codes, and more.
- The order also directs revisions to environmental review standards, including stormwater and wetlands permitting.
- The order coincides with ongoing Congressional debates over a major housing bill, and sends a signal that housing affordability issues remain a priority.
President Trump signed a new Executive Order (EO), Removing Regulatory Barriers to Affordable Home Construction, directing a range of federal agencies to reduce regulatory obstacles to new housing development. The EO includes provisions aimed at supporting local zoning and land use changes, streamlining environmental reviews, and aligning federal tax incentives.
The EO was issued along with a separate Executive Order to improve access to mortgage credit. Both come as Congress continues debate on a major housing bill with similar objectives. The 21st Century Road to Housing Act was passed by the Senate and intended as a compromise between two previous bills. The bill is now awaiting House action, but controversy over some provisions that could constrict the built-to-rent market may lead to further changes.
HUD Fast-tracks Guidance for Housing Regulatory Reforms
A key provision of interest to planners in the Removing Regulatory Barriers to Affordable Home Construction EO requires the U.S. Department of Housing and Urban Development (HUD) to issue "best practices" for state and local governments addressing issues, including:
- Streamlined permitting
- By-right development for single-family homes
- Updated building codes
- Limits on green-energy mandates
- Acceptance of manufactured and modular housing
- Removal of urban growth boundaries and similar restrictions
This best practice guide is placed on a fast track for delivery and is due by May 12, 2026.
Federal Guidance Can Drive Local Solutions
With access to national data, guidance, and best practices from agencies like HUD, planners can right-size reforms to fit their communities' unique needs. That's why strengthening an appropriate partnership between federal and local level governments is a top policy priority for planners and APA.
Learn more about APA's 2026 policy priorities and see how Congress can ensure communities have clarity, certainty, and support in accessing federal programs.
HUD is also on the clock for the release of a new round of Pathways to Removing Obstacles to Housing (PRO Housing) grants. It is also possible that the best practices noted in the HUD guide could be incorporated into PRO Housing and other federal grant criteria. A separate provision of the EO specifically directs HUD to re-evaluate the criteria for PRO Housing grants.
The EO also directs the Secretary of the Army and the Environmental Protection Agency (EPA) to revise permitting standards, including stormwater permits, wetlands permits, and related construction-site requirements. Home energy-efficiency mandates would also be reviewed for HUD and U.S. Department of Agriculture (USDA) financed housing.
Permitting Reforms Prioritize Housing Development
Federal standards for environmental and historic preservation permitting would also be revised under the Executive Order. The Council on Environmental Quality (CEQ) is directed to issue guidance creating categorical exclusions under the National Environmental Policy Act (NEPA) for housing construction. The Advisory Council on Historic Preservation is called on to reduce burdens on housing, construction, and related infrastructure projects under Section 106 of the National Historic Preservation Act.
On tax alignment, the Treasury Department and HUD will review and issue recommendations for how Opportunity Zones and New Market Tax Credits can better work together to support housing construction. Both tax incentives were made permanent in last year's major tax bill.
Formal regulatory action based on the EO will likely take months to be finalized. However, the action by the White House is intended to send a strong signal that housing affordability issues remain a priority. The order also keeps pressure on Capitol Hill to deliver a housing package.
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