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How the Trump Presidency Could Impact Real Estate

posted Jan 20, 2017, 4:04 PM by Joyce Evans   [ updated Jan 20, 2017, 4:06 PM ]
Regardless of political affiliation, PSAR members are wondering what President Trump will mean for the housing market in 2017. How will a Trump presidency impact the U.S. real estate industry? Will homeownership rates begin a sustained upward trend in 2017 and beyond?
 
As with any new president, we are hoping that President Trump will join our allies in local, state and federal government, spanning the political spectrum, and fight for the interests of homeowners and the real estate profession. It’s important to Americans that we improve the economy by creating job opportunities and affordable housing. Today, Americans want to feel secure and believe they have a fair shot in the marketplace. Mr. Trump has a tremendous opportunity to build a legacy based on achievement and building prosperity for the working class.
 
We’re especially hoping for solidarity with the platform put forth by the REALTOR® Party, an initiative of the National Association of REALTORS®, including such non-negotiables as protecting the mortgage deduction and promoting affordability. Other key issues of the REALTOR® Party include a commitment to protecting the environment and property rights, federal tax provisions that stimulate investment and diversity and fair housing issues since REALTORS® are ethically committed to equal professional service without discrimination based on race, color, religion, sex, familial status, handicap, sexual orientation, gender identity or national origin.
 
Meanwhile, real estate industry analysts vary in their predictions on the impact to our profession under a Trump administration with Republicans controlling both chambers of Congress. Trump made his billions as a real estate developer so he knows well the hurdles of dealing with regulations. As promised during his campaign, there could be less regulatory land-use and zoning burdens for home construction, thereby lowering the cost of building and increasing homeownership. Simply put, Mr. Trump’s first term will be defined by fulfilling his campaign promises and economic improvement.
 
Others crystal ball watchers are expecting the following:
-- The housing market thrives on optimism. Boosted by a Trump confidence pop, mortgage money may become plentiful as equity-sharing mortgages become more widespread with support from big lenders. Watch for a move away from stringent mortgage underwriting to more normal lending, along with reforms to Fannie Mae and Freddie Mac.
-- Job creation efforts will make headlines, as unemployment has already reached new lows. Expect Mr. Trump to not miss a beat when it comes to announcing a success, such as a factory saved, returned or open, or a failing company acquired and jobs saved.
-- With a U.S. President who specialized in luxury real estate, the high-end market may have a revival.
 
What’s also unknown is the impact of Ben Carson as secretary of Housing and Urban Development (HUD). We’ve seen that what seems to motivate Ben Carson is education. The home is the place where kids do their homework and read. So, as a result, it’s likely to expect the FHA to enhance multi-family lending to be friendly to single-family investors and expand access to capital for investors of single-family rentals.
 
Also, Carson is expected to take a “listening tour” of Americans to find out how a bloated, dysfunctional and detached government can best serve them and how they can do more for themselves. Watch for overcoming adversity, discrimination and poverty at the heart of Carson’s HUD. The rap against Carson is that he may be a fantastic neurosurgeon, but without experience in housing or running a government agency, can he lead as head of housing? We need to wait and see.