Cheaper Homes and a Tax Trap Fixed: The US Housing Reforms Jamaica Should Study

Kingston, Jamaica, 28 June 2026

The United States Congress has passed what amounts to the most ambitious federal intervention in housing policy in a generation, and two of its provisions carry particular significance for anyone tracking Jamaica’s housing affordability conversation. One addresses manufactured housing. The other takes aim at the capital gains rules that have quietly locked millions of American homeowners in place, freezing inventory and driving up prices for buyers of all income levels.

Manufactured Housing: A Federal Reset

Buried within the 21st Century ROAD to Housing Act is a provision that removes the requirement for manufactured homes to be built on a permanent chassis. This single technical change, easily overlooked in the legislative debate, has the potential to reduce the cost of a manufactured home by between $4,000 and $13,000 per unit, according to industry analysis. The Bipartisan Policy Center notes that manufactured housing already accounts for 5 percent of the US housing stock while housing 22 million Americans, many of them on lower incomes. It is the country’s largest source of unsubsidised affordable housing. Removing the chassis requirement allows more flexible design, reduces production costs, and may make factory-built homes eligible for traditional mortgage financing in a wider range of circumstances. The Act also updates Department of Housing and Urban Development codes to require higher energy efficiency, weather resilience, and sustainable materials. A series of zoning reforms tie federal infrastructure grants to local government adoption of manufactured housing in residential zones, an attempt to overcome the single biggest obstacle to wider deployment: local resistance.

Capital Gains: A 30-Year Tax Trap

The capital gains exclusion for primary residences has been set at $250,000 for single filers and $500,000 for married couples since 1997. When Congress set those limits, the national median home price was approximately $129,000. Today it sits at around $419,000, and in many coastal and urban markets, prices are far higher. Research from the National Association of Realtors estimates that 34 percent of American homeowners, roughly 29 million people, could now face capital gains tax exposure if they were to sell, with that figure projected to rise to 56 percent by 2030. The practical effect has been to discourage long-term homeowners, particularly older residents, from selling, because the tax bill would consume a significant portion of their equity. Homes stay off the market. Inventory tightens. Buyers compete over a smaller pool of available properties. Prices rise.

The legislation now moving through Congress includes proposals to double the exclusion thresholds and index them to inflation going forward, correcting the slow erosion caused by decades of fixed limits in an appreciating market.

What Jamaica Can Take From This

Jamaica does not have a manufactured housing industry at any meaningful scale, and its capital gains framework differs from the American model. But the underlying dynamics are recognisable. A housing market in which long-term owners are effectively locked in, where the cost of building is rising faster than affordability allows, and where the policy tools designed to help were set decades ago and never updated, describes pressures Jamaica is navigating in its own way. Factory-built and modular construction is gaining attention in the Caribbean as a potential accelerant for housing delivery. The US experience, with its combination of federal standards, zoning pressure, and financing access, offers a working model of what it takes to bring manufactured housing into the mainstream. Whether Jamaica’s policymakers are watching closely enough is a different question.