Trump’s impending presidency has created a lot of controversy and given subject to many conversations. One such discussion revolves around real estate and whether or not it will improve or decline.
Some believe Trump’s election to office will improve the real estate market due to his experience in the field.
The President-elect Donald Trump, who made his fortune building luxury condominiums, hotels, and casinos, will have to face his biggest challenge yet, helping the middle class find affordable housing. During his campaign for president, Trump didn’t discuss any plan of action to fix the affordable housing and rising cost of rentals among middle class people.
During Trump’s speech on November 9th, he promised new investments in infrastructure, which may increase demands for housing. What he did say was he would be rebuilding many basic things needed for social life, schools, hospitals, airports, etc. And much like during the Hoover Dam project, skilled workers will need housing for these projects. But housing rental demands are at an all-time high, with affordable housing being a top priority for everyone. With the increase of paid workers, steady incomes and jobs, the housing market should soar, but that also depends on the amount of housing in the area. Demands are at a high, and supply is not increasing for middle income families. Added on, 30 year mortgage rates are steadily increasing to 4-4.5%, which has started many locking in their loan interest rates. But with the increase of jobs, means stable incomes for more workers, and that in turn leads to more people being able to purchase their own home rather than rent an apartment. With the Federal Reserve indicating they will continue to raise rates in 2017, it makes it rather hard to know which way the economy will fall. Though construction and real estate workers will be at an all time high in demand with the many projects Trump has promised. For those buying, the future looks bright, even with a higher interest rate of 4.0%, which is around a percent higher than the lowest rate at the beginning of 2017. For middle income renters the future seems less clear with middle income housing being sought, and supply of such housing is remaining steady.