Tuesday February 3, 2026
One of the lesser acknowledged facts about today’s housing market is that scarcity isn’t universal. In many rural areas and small towns, a robust housing supply exists. Inventory is widely available. Prices are (often dramatically!) lower. What’s often missing isn’t housing itself, but the ability for people to live in those homes and connect to reliable high-speed broadband to remain economically productive.
Said differently, the shortage in the housing supply today isn’t just about what’s built; it’s about what’s usable. And increasingly, usability depends on whether people can participate in the information economy from where they live. When that condition is met, formerly stagnant housing becomes viable once again. When it isn’t, that supply remains stranded … technically available, but practically unusable for many or most.
This isn’t a failure of effort or imagination. Broadband access in small and sparsely populated communities has long struggled to attract private investment. The economics are challenging: high upfront costs, low density, and long timelines to return. Housing professionals already recognize this pattern in other forms of infrastructure such as water systems, sewers and roads. These elements are essential for economic life but are unlikely to be delivered everywhere by the market alone.
Over time, federal agencies including HUD, USDA, and NTIA have increasingly treated broadband the same way: not as a consumer amenity, but as critical economic infrastructure. Connectivity has been identified as a prerequisite for workforce participation, community stability and long-term housing viability. In that context, subsidies aren’t ideological; they are structural.
There are historical parallels. Programs like rural electrification and the Tennessee Valley Authority weren’t designed as housing policy. They were responses to market realities that left entire regions economically sidelined. Electricity didn’t create demand on its own. It made participation possible. Housing stability followed because communities became economically usable again.
Broadband plays a similar role today. It doesn’t tell people where to live. It determines where living can work.
The pandemic offered a real-world test. As remote work expanded, proximity to major employment centers became less of a determinative factor for many people. Migration data from 2020 through 2023 showed movement toward smaller communities and non-metro areas, particularly where reliable broadband already existed. This wasn’t just about lifestyle preferences; it was about feasibility. Where people could work, housing supply became actionable. Where they couldn’t, housing demand continued to languish.
Which brings us to the Broadband Equity and Access and Deployment (BEAD) program. Functionally, BEAD was designed as long-horizon infrastructure; extending connectivity into places where commercial deployment alone wouldn’t close the gap. From a housing perspective, its effect is straightforward: expanding the geography in which existing housing stock can actually be used.
Recently, that infrastructure has been interwoven with an entirely different policy objective. A December 2025 executive order signaled that states adopting artificial intelligence (AI) regulatory frameworks considered “onerous” or “overly burdensome” could risk losing previously awarded BEAD funding.
It’s worth noticing the attempt to create an intersection of AI regulation and BEAD. Broadband infrastructure and AI governance operate on different timelines and solve different problems. One addresses a long-standing market limitation and enables economic participation. The other seeks to manage emerging technology in a national market. Linking the two introduces a tradeoff that might be less than ideal, especially for unlocking housing supply.
To be sure, state versus federal tension isn’t unusual. States have long served as laboratories for policy, responding to local conditions and priorities, while the federal government often seeks uniformity where national markets are involved. We’re certainly well accustomed to that in the world of housing finance. The balance between state authority and national consistency is a feature of the system, not a bug.
What’s notable here is the leverage point. Broadband infrastructure, one of the few tools that makes existing housing supply economically usable, becomes conditioned on alignment in an adjacent(?) policy domain.
It’s been described by some officials as “keep your AI peanut butter out of our rural broadband chocolate.”
Why does it matter? Broadband investment has increasingly become a housing strategy. Not by creating new homes, but by making more places livable for people who need to work.
AI governance serves an entirely different (and legitimate) purpose. Asking one to carry the other creates a bargain worth questioning.
Until Next Time,
Mary Schuster
Chief Knowledge Officer
October Research, LLC