What the Future Holds for the Real Estate Market During Trump’s Presidency

By: Alejandra Zamora

Almost two weeks ago, Donald Trump, perhaps one of the United States’ most controversial presidents, was inaugurated into office. While many of his political viewpoints, leadership tactics, and what he plans to change in this country still remain unclear to many Americans, his administration’s effect on the real estate market takes a much more definite shape.

Many infer that businessman Trump will run the country similarly to that of his business empire. His experience as a real estate developer will hopefully support significant economic growth over the next four years, and will sustain beyond that time frame. According to CNBC, Trump plans on cutting both “corporate and individual taxes while investing up to $1 trillion on the country’s infrastructure.”  This plan reflects what Trump has done with his real estate development in the past, only this time it is to use debt to invest in property, which, as time progresses, will hopefully lead to increased capital that will pay back the investment and create that economic growth.

Furthermore, Forbes magazine has laid out 5 real estate trends that they predict will come with this plan:

1.     Non-bank lending: This practice is projected to take over real estate lending, which may protect lenders from the implementation of risk-retention requirements.

2.     Increased interest rates: A clever tactic in itself, implementing increased interest rates may reduce risk for borrowers by making real estate more costly, therefore forcing borrowers to proceed their endeavors with greater caution.

3.     Financial legislation: Forbes predicts that this will be a risky trend, for by creating a dangerous market environment proven to be harmful to real estate, balanced regulation requirements (meaning they are not too loose) are needed to prevent another financial crisis from happening.

4.     White House and Wall Street: With Trump appointing former Goldman Sachs banker Steven Mnuchin as Secretary of the Treasury, Wall Street will be well represented in the White House.

5.     Decreased foreign investment: With foreign property deals being subject to examination, this serves as a potential danger to the real estate market.

             To read about how the Trump administration will affect our local real estate market, check out: