What Effect Would a Trump Presidency Have On The Real Estate Market?
According to some, the former real estate mogul may not have a positive effect on the current market.
Like it or not, November 9th we’re all going to wake up to a new President of the United States. It may be difficult to think about, but if that guy—what’s his name… the one who used to host The Apprentice—actually becomes the new POTUS, we might as well find out what that would mean for the condition of the real estate market in the US. After all, just because he’s a real estate tycoon doesn’t necessarily mean he’s going to be a positive influence for the economic development of the real estate markets.
Even with high end real estate muckity-mucks like Howard Lorber—owner of Douglas Elliman, owner and developer Richard LeFrak, and Vornado Realty Trust’s CEO- Steven Roth supporting Trump, more than 100 past and present Republican officials and politicians still absolutely refuse to vote for him. So if his fellow tycoons support him, does this mean he’s good for the market?
Jay Rollins, CEO of JCR Capital and all around smarty-pants about the economy and all things real estate shares, “A Trump presidency would cause more emotional investing than quantitative and there would be a tremendous amount of volatility in the commercial real estate world, primarily from the liquidity side. Equity markets would also freeze-up and that could cause a value decline, which would primarily affect people who have loans coming due. A Trump victory could also slow down the transactional side due to less capital available.”
However, a lot of information isn’t as readily available as to what affect a Trump—or even a Clinton presidency would have on the residential real estate sector. This is probably due to the fact that the housing market isn’t in the limelight as much as it was during the Obama administration. Trulia’s chief economist, Ralph McLaughlin says, “Voters shouldn’t necessarily be surprised by the little attention that Hillary Clinton and Donald Trump have paid to housing this election cycle. Eight years ago, housing and the economy were the main talking points of Obama and McCain because millions of homeowners were going through foreclosure and the economy was in shambles.”
Now that some Americans are on the road to recovery from the former housing crisis, Trulia.com asked some to participate in a survey about whether or not their housing decisions would be based on the election of either candidate. See what they said, here. In general, Trump is not touting a typical Republican platform that would normally be positively associated with an up-tick in the real estate market. His foreign policies could lead to a trade war which may negatively impact the entire economy.
A Trump presidency will not only affect immigrants because of the restrictions he plans to implement to allow them into this country, but additionally short term visitors will also be limited to the US. This will then have an effect on foreign investors who usually buy a lot of high end US real estate. As if that’s not foreboding enough, kiss all affordable housing good-bye under a Trump Presidency. He’s talked openly about demolishing the U.S. Department of Housing and Urban Development which is ground zero for federal funding for affordable housing. This would affect hundreds of thousands of lower income Americans and would be a game changer in the housing market.
But if one wants to know what The Donald feels about the real estate market, one doesn’t have to look further than the first debate when he told the world he was hoping the housing market would collapse before the 2008 recession. According to Politico.com, Hillary Clinton shared in the first debate, “… Donald was one of the people who rooted for the housing crisis. He said back in 2006, ‘Gee, I hope it does collapse because then I can go in and buy some and make some money. Well it did collapse.” To which Trump retorted, “That’s called good business, by the way.” That might well be. For The Donald, that is. But maybe not so much for rest of the country.
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