New President Elected: What It Means for the Housing Market

A recent Redfin survey found that 23% of home buyers are holding off until after the election to make a purchase, and 15.9% are waiting to see if Trump’s housing affordability plan becomes law. As Donald Trump gets ready to take office, we could see some big changes in real estate policy that might affect the housing market, property taxes, and home loans. Here’s a simple breakdown of what these changes could mean for home buyers and homeowners:

Trump's approach to Real Estate

Trump's approach to real estate focuses on deregulation, with the goal of making it easier for developers to start projects. By reducing restrictions and cutting red tape, he aims to streamline approval processes and lower building costs. This could lead to an increase in housing supply, which may help alleviate affordability issues in some areas in the long term.

However, while this increased supply might temper housing prices in the long term, other factors, such as high interest rates, could still weigh on buyers in 2025. The Federal Reserve’s current interest rate policies have led to higher borrowing costs, making it harder for buyers to afford homes. Unless there’s a shift in interest rates, home sales might slow down, keeping prices relatively high due to supply-demand imbalances as per Go Banking Rates.

Property Taxes and Mortgage Lending

In terms of property taxes, Trump's administration is expected to lean towards maintaining or expanding tax cuts, especially those benefiting real estate investors. Tax cuts like those included in the 2017 Tax Cuts and Jobs Act (TCJA), which included provisions like the 20% deduction for pass-through entities, might be extended or enhanced, providing benefits for real estate investors and possibly landlords. However, any changes in local property tax policies will likely vary by state, especially as property values continue to adjust​.

On the mortgage front, Trump has historically advocated for the privatization of government-sponsored enterprises (GSEs) like Fannie Mae and Freddie Mac. Privatizing these entities could lead to changes in how home loans are structured and offered, possibly reducing federal guarantees and making lending more conservative. For some buyers, this could mean stricter loan qualification standards but more competitive loan products in a less federally dominated mortgage market​ (Norada Real Estate Investments).

The Limits of Presidential Power

While the President can influence the housing market, their control is limited by Congress, the Federal Reserve, and the natural ups and downs of the economy. Market forces like supply, demand, and consumer confidence also play big roles, so the President’s impact isn’t absolute. In short, the President can shape housing policies and the economy, but housing prices and mortgage rates are largely driven by broader economic forces and independent institutions.

The bottom line? Stay open-minded, because there’s no wrong time for the right property! While interest rates aren’t likely to drop back to 3% unless there’s a major economic downturn (which nobody wants), it’s all about finding what works for you. Start by figuring out a comfortable monthly mortgage payment and how much you can save for a down payment. Navigating today’s real estate market can feel overwhelming, but we’re here to help! Reach out anytime for a free consultation tailored just for you.