Political research shows an increasing interest in the political repercussions of subnational heterogeneity in housing markets. Whereas the effects on voters’ preferences and behaviors receive increasing attention, effects on parties’ policy supply remain understudied. Integrating theories of party competition with literatures on intra-party politics and dyadic representation, we argue that MPs in territorial representation systems seek to strategically diversify their housing policy supply in response to housing market contexts in the districts they represent. In doing so, MPs avoid ‘direct confrontation’ with their national parties and instead use ‘selective emphasis’: They do not openly oppose the party line but emphasize (tone down) their parties’ stance where doing so is electorally (in)opportune. To test our argument, we study German MPs’ housing-related policy communication on Twitter. Using a novel approach for legislator-level position and salience estimation in conjunction with original characterizations of local housing markets in terms of rent-to-income ratios, we find both cross-sectional and longitudinal evidence in support of our argument. Our findings deepen our understanding of the political effects of housing markets and highlight new research potentials for the study of representation and subnational party competition.