The US Government Is Sitting on a Possible Solution to the Housing Crisis

The US Government Is Sitting on a Possible Solution to the Housing Crisis

The idea of opening up public lands to development enjoys bipartisan support and cuts through red tape.

Photographer: Hannah Whitaker for Bloomberg Businessweek

By Michael Albertus
January 8, 2025 at 3:00 AM PST

Among the more urgent tasks facing Donald Trump now that he’s heading back to the White House is answering calls to address the country’s housing availability and affordability crisis. First-time and low-income homebuyers are all but shut out of the housing market, foreclosing the opportunity to build wealth and put a down payment on their own American dream.

The Trump campaign offered several policies to address the problem, but the centerpiece was the idea to open up federally controlled public lands for housing construction. It’s a particularly attractive idea because it can skirt local red tape, and it has bipartisan support. 

But if it’s going to succeed, the plan has to be oriented toward transforming smaller plots of land within urban areas and on their periphery. . .

The trouble is that many federal lands are not attractive for development or have other important uses, including outdoor recreation, wilderness habitat preservation and forestry, as well as livestock grazing and mineral and energy extraction. 

• Much of the terrain is too rugged for building or too far from the places where people want to live. That’s especially true of the vast expanses of arid land in the West, where most federal land is located. 
• Many developers have made a similar point: 

The chief housing problem is that affordable homes are not available in the most attractive places to live, which are typically dynamic cities. Of course, building in remote areas could help alleviate housing pressure elsewhere. 

• And it’s notable that after the Covid-19 pandemic, many remote workers fled cities for rural areas where opportunities for recreation abound.

Federal Lands in the Western US

The US government owns about 50% of the land in the West

Source: US Geological Survey

The idea of building whole cities from scratch in the middle of nowhere is unattractive to most homebuyers, who want to live where there are ample economic opportunities, services and cultural activities. Instead, the Trump administration should focus on identifying federal parcels of land within or adjacent to metropolitan areas that could be transformed into housing.

A considerable amount of property meets this criterion. 

• One study found that in Utah alone, the US Forest Service and the Bureau of Land Management (BLM) own 217,000 acres within the boundaries of cities. Another 650,000 acres of federal land—excluding national parks, military bases and areas with other congressional protections—are located within a mile of Utah city boundaries. In a state where new homebuilding permits have hovered at 30,000 a year, that’s sufficient acreage to keep developers busy for decades.

A separate national estimate, from a recent report by Senate Republicans, looks at the potential to build housing on federal land. Based on an analysis of holdings of the BLM, the report estimates that about 680,000 buildable acres of federal land near or within existing developed areas could yield 2.7 million new homes.

May 18, 2020 
Sen. Lincoln Fillmore Co-Chair, Federalism Commission
320 E Capitol St Salt Lake City, UT 84114

Rep. Keven Stratton Co-Chair, Federalism Commission
350 N State St #350
Salt Lake City, UT 84114

Re: Federal Land Valuation Model Agreement, Amended August 20, 2019 RFP No. COF-2018-03, 
November 14, 2018

U.S. Senator Mike Lee has described your unanimously bipartisan initiative as “a generational opportunity” and we share in his enthusiasm and excitement for the future of our great state, in this regard... While this contract is with Geomancer, AEON AI has now acquired all of Geomancer’s software and technology. As such, all of the future data and software maintenance specified in the contract, as well as any additional services that this Commission may require, will be performed by AEON AI.

In fulfillment of our agreement, we are prepared to provide login credentials, training for the users identified by the Commission, and maintenance to fulfill the contract support provision. Having now completed the fully operational Federal Land Valuation Model (FEDERAL LAND VALUATION MODEL) for all counties within the state of Utah, please find our analysis below...

For the purposes of this particular analysis of PILT, compared to the equivalent property tax for similar property, the federally controlled public lands inside city limits (in-held) include only Bureau of Land Management (BLM) and U.S. Forest Service (USFS) lands, and exclude military, national parks, and other federally controlled lands with congressionally designated protections.

 • The federal PILT payment for these 217,000 in-held acres is $505,000.

 • The equivalent property tax for these 217,000 acres of raw, undeveloped federal inheld land, under the current city zone or general plan, exceeds $131 million a year.

 • The potential property tax equivalent for these 217,000 acres, assuming their built-out use as low density residential, under the current city zone and general plan, exceeds $361 million a year. 

• The fair market value of the 217,000 raw, undeveloped, in held federal acres exceeds $21 billion dollars. 

• If the federal government decided to apply these in-held lands to community planning and recovery, as it did for more than 70,000 acres in and around Las Vegas, Nevada over the past two decades (pursuant to the Southern Nevada Public Lands Management Act), the five percent (5%) attributable to the support of Utah schools under our Statehood Enabling Act, exceeds $1 billion.