Real Estate After Trump's Election: What Next?

Everyone in my business is trying to get an understanding of what a Trump presidency will mean for real estate, both residential and commercial. The stock market has surged since November 8, and while there are sharp disgreements, a lot of people in business are pleased.

Here is how two industry news organizations analyze it, as of December 7, 2016.....

From REALTOR.com:

"We do know that the incoming president will limit the federal government’s role in the real estate market, as was outlined in the 66-page Republican Platform 2016. So, longer term, the implications of this for home buyers, sellers, and owners could be sweeping.

"As for now, “our November elections come at one of the slowest time of the year for sales, so I doubt we will see much disruption to the normal seasonal pattern” of home buying and selling, says realtor.com’s chief economist, Jonathan Smoke. “However, one short-term risk could be if the [election] has a big impact to financial markets that lasts more than a few days. “About half of voters got what they wanted,” he adds. “If this does impact purchases, it is more likely to be in blue states and not the red heartland.” 

"A Trump presidency could be a boon for home buyers struggling to save up for a hefty down payment. That’s because he has promised to cut taxes and shrink the number of tax brackets from seven to three. This could, in theory, leave buyers with more money to spend on the homes of their dreams. 

"And it could give the luxury market, which has been slowing down as of late, a boost, says James Harris, one of the star real estate agents on Million Dollar Listing Los Angeles. “For the high-end, luxury market, it may turn into something very positive.”


From NREI Online:

"Business owners, investors and others are asking key questions, such as whether it is feasible to make hiring decisions, launch expansion programs or make investments during this uncertain period. In a broader sense, they are asking how markets and foreign leaders will respond. Some early signals, within the first seven to 10 days after the election, aren’t conclusive; they may only reinforce the uncertainty: Just after the election a prospective client announced his intention to delay investing in our Fund III until there is “greater clarity about what a Trump presidency means for the investment outlook” in the United States. Since election day, the Dow Jones Industrial Average has produced a 625-point-gain (3.4 percent) to about 18,957. This is far different than late election night when the futures market was down 800 points. Interest rates already have started to climb, increasing more than 30 percent, from 1.75 percent to 2.30 percent. We know a lot of the president-elect’s positions and likely actions on a variety of issues, or at least we think we do.” 

My own perspective:

In addition to the continuing stock market surge, Carrier announced a deal where it will keep some 300 engineering jobs and 800 lower wage manufacturing jobs in the U.S. rather than shipping them all off to Mexico. The company still plans to send another 1300 jobs to Mexico, but was persuaded to keep a plant open in Indiana rather than shutter the facility. Mr. Trump has claimed credit for that agreement, though some suggest he is taking credit for too much.

More recently, the CEO of Softbank, Mr. Masayoshi Son, announced in a joint appearance with President Elect Trump, that the Japanese business concern will invest $50 billion in the United States in the next several years. He expects that infusion to wind up creating some 50,000 jobs for Americans.

Regardless of politics, when jobs are increasing, that is good for the economy and GREAT for housing. Reducing the number of tax brackets also would be a boon for all buyers, particularly in the luxe segment.

Time will tell. More to come . . .