In a new research note published Thursday, UBS analysts assessed the Economic Report of the President, which laid out the administration’s most detailed housing strategy to date and found that the U.S. is short roughly 10 million homes, even higher than UBS’s own estimate of approximately 7 million units. The verdict: well-intentioned, directionally right in places, but unlikely to provide the “adrenaline shot” the housing market needs heading into the midterms.

The administration’s central argument is that government regulation — what the White House calls a “bureaucrat tax” — is the primary culprit behind the nation’s housing affordability crisis, and that the burden adds more than $100,000 to the cost of a single-family home. The administration estimates that a one-standard-deviation decline in the Wharton Residential Land Use Regulatory Index could increase the U.S. housing stock by 13.2 million units.

To prove the concept is achievable, the White House pointed to Texas in the early 2000s, when looser land-use rules and rapid suburban expansion enabled home prices to remain stable even as its population surged.

The problem is that the model eventually produced overheated prices — and a boom-bust cycle that Texas is still working through. Fortune‘s Lance Lambert reported in 2022 that Austin had become overvalued by 41% and Dallas by 33%. By 2026, the correction has arrived: Austin home values have fallen more than 11% from their 2022 peak and the city now ranks 51st out of 52 large U.S. metros in housing market health, with Dallas down nearly 11% as well.

“While frothy home prices and negative demand shocks are key elements of boom-bust cycles, so is supply elasticity,” Lambert, currently the editor-in-chief of ResiClub, told Fortune. “The fact that markets like Austin, Punta Gorda, and Tampa have more available land that can be built on means they are more likely to see a supply response following overheating in home prices and rents.”

When demand surges in those markets, builders can ramp up construction relatively quickly. But when demand cools, the additional supply coming online can amplify downside pressure on prices and rents.

The flip side, Lambert noted, is that supply-constrained markets like those in the Northeast or coastal California tend to see less dramatic boom-bust swings precisely because of limited buildable land and lower levels of new construction.

In Texas, therefore, the administration is essentially citing a success story that became a cautionary tale — precisely the boom-bust volatility that deregulation alone, absent coordinated demand management, has historically failed to prevent.

None of that means deregulation is the wrong long-term prescription. “There isn’t a magic wand that will all of a sudden return housing affordability to its historic average tomorrow,” Lambert said. “It will take time for the recent deterioration to heal, and some markets will see it faster than others. That said, over the long term, if we make it easier to build in more markets, the faster supply may be able to respond to these cyclical spikes in housing demand — like we saw in 2020–2022 — and we’d have a healthier housing market.”

UBS analysts called the attempt to tackle housing from both a supply and demand perspective “encouraging.” The suggested best practices organized around unleashing manufacturing innovation, streamlining homebuilding stages, and protecting consumer choice also represent “a step in the right direction,” it added.

But the bank sees a fundamental structural problem: housing regulation in the United States is overwhelmingly controlled by local governments, not Washington. That means the administration’s guidelines are, at best, voluntary suggestions. So the states with the heaviest regulatory burdens, like California and New England, lean Democratic and “may prove less willing to abide” by the White House’s playbook.

This is not a new finding. In January, Morgan Stanley strategists characterized Trump’s housing directives as only “modestly helpful for homeowner affordability,” warning they amount to a marginal adjustment rather than a market cure. The real obstacle, Morgan Stanley concluded, is the “lock-in” effect: roughly two-thirds of all outstanding mortgages still carry interest rates below 5%, meaning homeowners have little financial incentive to sell no matter how much deregulation Washington pushes through. Apollo Global Management’s Torsten Slok noted that 40% of U.S. homes carry no mortgage at all, making the lock-in effect even deeper than mortgage data alone suggests.

Meanwhile, the housing market has been frozen for nearly three years, with the spring thaw that buyers keep hoping for repeatedly failing to materialize.

If the White House wants to move the needle quickly, UBS pointed to a more tractable lever: having Fannie Mae and Freddie Mac ramp up mortgage-backed securities purchases, or temporarily cutting the guarantee fees the two government-sponsored enterprises charge lenders. It’s the same mechanism the administration tried in January, briefly pushing the 30-year rate below 6% for the first time since 2022 before the effect faded.

There was one area where UBS expressed genuine enthusiasm: off-site and modular construction. Construction labor productivity declined roughly 30% between 1970 and 2020 — a drag the administration estimates has cost the U.S. economy about 20 basis points of GDP growth per year — while overall U.S. productivity rose by 100% over the same period. UBS estimates wall panelization alone could generate $6,200 in per-home cost savings at scale, 30% fewer framing days, and 20% less waste.

The administration’s report recommended aligning building codes for modular and prefabricated housing with national standards, which UBS called a potential catalyst for efficiency gains across the entire housing value chain.

Still, off-site construction is a years-long buildout, not a spring solution. For now, the gap between the administration’s housing ambitions and its available tools remains wide.