Dream Finders CEO Patrick Zalupski struck an ominous tone on land entitlement, government assistance, and affordability challenges facing the housing industry in his 2025 letter to shareholders.
While builders have found success combating elevated interest rates with mortgage rate buydowns and price cuts, solutions for land entitlement challenges remain more elusive. Zalupski notes that the local government process required to bring new housing stock to market will continue to strain affordability and push home prices higher.
“Although interest rates are expected to eventually decline, the process of entitling and developing land has never been more complex or difficult than it is today,” wrote Zalupski. “The most significant factor affecting housing stock is the constraints on new community creation. Unfortunately, this type of development is being hindered by the actions of local municipalities throughout the country, which are withholding their approvals of new communities and, thus, artificially limiting supply.”
“While county officials frequently discuss the importance of accessible housing, the reality is that nearly every policy they enact leads to increased home costs and prices rather than improved affordability,” Zalupski continues.
Zalupski’s letter provides context for the 2024 performance of Dream Finders Homes, the 2025 Builder of the Year, but the challenges highlighted related to entitlement, local municipalities, and affordability persisted throughout 2025. They also will likely remain headwinds for builders in the years ahead. In her outlook for 2026, Susan Heffron, vice president of home building for the southeast at Zonda, said policy, land entitlement, and regulations are affecting Southeastern markets from Nashville to Orlando.
“The entitlement process taking so long just adds more and more cost to a home [and] that impacts affordability,” Heffron told BUILDER.
Zoning, entitlement, and regulatory barriers were also central themes at the first annual National Housing Supply Summit held in March 2025. At the federal level, housing affordability has gained increased visibility. The Trump administration issued an executive order on Inauguration Day citing affordability challenges as a key issue and in September 2025 considered formally declaring a national housing crisis related to affordability. Despite the attention, industry leaders caution federal attention alone will do little to resolve the underlying local issues.
Among builders surveyed by Zonda, land costs and regulatory challenges ranked among the top concerns impacting margins heading into 2026. These findings reinforce long-standing builder sentiment that restrictive land-use policies and fragmented local regulations are constraining supply and limiting the industry’s ability to deliver attainable and affordable housing.
Zalupski echoed that frustration in his shareholder letter, writing that the reliance on government intervention to improve entitlement and affordability issues “often feels futile and lacks promise.”
“Until local politicians recognize and address this issue, it is unlikely that the industry’s long-term affordability challenges will be meaningfully resolved,” Zalupski wrote. “Home builders, like any other business owners, are resilient and will continue to find ways to succeed even in challenging conditions. Unfortunately, the repercussions of these difficulties will likely be felt most acutely by ordinary Americans and those aspiring to own homes.”
Zalupski’s letter notes a positive tailwind for the industry is the national attention housing affordability is receiving. However, the changes needed to improve conditions for builders and buyers will occur on a smaller scale. Housing is local and the solutions that will help move the needle are also local.
“The core issue is that there is not much the federal government can do to help,” Zonda chief economist Ali Wolf said when the Trump administration was considering declaring a national housing crisis. “A lot of housing issues are local, whether it’s ‘Not in My Backyard’ residents stopping new construction, cities creating prohibitive laws, or high local land prices making it difficult to achieve an attainable home price.”
As builders look toward 2026, reducing regulatory burdens and entitlement delays remain top priorities for expanding housing supply. Such an outcome is not only essential for builders, but for restoring affordability for future buyers.
