Building Houses on Federal Land: Is It Viable?

The recent push to sell federal public lands—spearheaded by Republican Senator Mike Lee—has been framed as one way to alleviate housing pressures throughout the West. Now, we could spend all day theorizing on the other motives behind selling public land, and I reckon we’d sadly be correct in a few assumptions. But framing a land sale as a way to “increase housing supply” in an area of the country where home prices have skyrocketed in the past five years is a savvy (if likely dishonest) move to garner support from folks who may not understand the true value of wide open spaces. 

So, let’s take this idea at face value: would selling public lands actually help with the housing problems in the West? 

Well, let’s start with where Lee’s bill currently stands. He made changes to it that exclude any Forest Service land from being sold. That means land administered by the Bureau of Land Management is on the table, and to be eligible, it would need to be within five miles of a “population center.” While those terms aren’t as yet defined, that leaves us with just about one million acres of land that could be sold. 

Where to build?

Jackson, Wyoming, is home to one of the nation’s biggest housing shortages. Only billionaires can afford homes there, but the mega tourist destination still requires regular people to run shops, bus tables, and keep the city moving. If BLM land near Jackson were sold, this is what’s available: 

The land highlighted in yellow is BLM land. There are a few islands in the Snake River, and a good deal of riverfront property. Just how viable is that type of land for building? Flood risks would be high, and fair market value on land right on the Snake River means any housing built here would likely not be affordable for the average worker in Jackson. 

Well, the folks over at Headwaters Economics did a deep dive into this issue. While they didn’t focus on Jackson, specifically, what they found is just how challenging it would be to build houses on federal land. 

First, they looked at all the Forest Service and Department of the Interior land (which includes BLM) near communities “where housing production has lagged behind demand, including in rural places…[and] developing gateway communities near national parks.” Of the 181 million acres they looked at, only 2.4 million would be suitable for housing development. However, when you factor in wildfire risk, that number becomes roughly one million acres that are available. 

Their report goes on to say that “Applying a conservative density estimate of 0.66 housing units per acre—the Census standard for defining urban core areas—and assuming areas with high wildfire risk should be avoided, we estimate fewer than 700,000 new homes could be built on the suite of federal lands that are near Western towns and cities with unmet housing needs. The potential is concentrated in just a handful of states: Nevada, Arizona, California, New Mexico, and Utah.” 

Again, that report assumes Forest Service land is for sale, which it no longer is. The total number of homes is likely much less than 700,000 now that BLM land is all that would be sold, if Lee’s bill passes. 

Is it affordable?

That’s also assuming the homes can be built for a price point that’s affordable. Many of the communities where these housing projects would take place are already more expensive (Jackson is the most expensive real estate in the United States) than most people can reasonably afford. 

I keep hitting the affordability aspect because Lee has consistently framed this public land sale as a way to help young Americans afford homes. 

Housing prices are crushing families and keeping young Americans from living where they grew up. We need to change that.

Thanks to YOU—the AMERICAN PEOPLE—here’s what I plan to do:

1. REMOVE ALL Forest Service land. We are NOT selling off our forests.

2. SIGNIFICANTLY REDUCE…

— Mike Lee (@SenMikeLee) June 24, 2025

When you look at the situation objectively, you have to ask yourself if developers would be willing to put high-density, cheap housing on prime real estate. Are rows of condos along the Snake River really what would be built if that land were sold? Or would it be another mini-chateau for a part-time resident? 

And would insurance companies even cover homes built in these areas? Major carriers are leaving entire states (California), and those living in fire-prone areas in the West are being dropped from coverage completely. 

You’d also need to consider the infrastructure for these homes. Is there enough water? Could electric and sewer service realistically be brought to the development at a reasonable cost? And is there enough of a workforce in these areas to build the homes? 

These are all questions that Lee’s bill fails to account for. 

Another smokescreen

Even engaging with the idea in good faith, it’s clear that this public land sale wouldn’t be the bonanza for housing that Lee and his supporters make it out to be. On top of that, mechanisms already exist to sell federal land for housing, notably the Federal Land Policy and Management Act. There’s a good argument to be made for streamlining that process, instead of a fire sale on public lands in general. 

While it’s cleverly constructed, the idea of selling public lands for housing development is another smokescreen designed to engender support for a policy that would drastically alter the quality of life for everyone who lives and recreates in the West. 

Mike Lee’s Next Public Lands Move

Support Public Lands: Flood The Lines Day June 25