As we approach Inauguration Day, many Americans are wondering what a Trump presidency will mean for their lives and their families. When it comes to real estate, having Donald in the White House might be a good thing.
Trump knows a thing or two about real estate, as his father was a real estate tycoon and Donald himself has made his millions buying and selling luxury real estate. Trump’s surprise win of the recent election puts a leader of property and real estate in the White House for the first time. He will undoubtedly be a pro-real estate and pro-property president, which many buyers and sellers look forward to.
It’s all still a bit of a mystery now, since nobody knows exactly what Trump will do once he moves into his new home on Pennsylvania Ave. It is safe to assume that there will be a short-term boost in the economy in the early part of the year, at the beginning of Trumps’ presidency. Tax cuts and Trump’s plan to spend more money on national defense will play a big part in the boost we see in the first half of the year. He has proposed massive tax breaks for the wealthy, including lowering the corporate tax. The market will more than likely react positively to these changes as first, but there is also the risk of creating a “bubble” that will eventually burst down the line.
A lot of what happens in the real estate market depends on future Wall Street reform laws and how banks are regulated, since they are the ones giving the loans to the real estate community. Some argue that changes in mortgage laws will have little-to-no effect on the luxury real estate market, as many of those buyers pay cash for their homes.
The one thing that is certain regarding the Trump presidency is that nothing is certain. It is a wait-and-see game now until we see what policies, rules, laws and regulations Trump decides to put into action. When things do start to get moving, we may see some rapid and unpredictable changes in the stock market, which is closely linked to the luxury real estate market, since most of the investors are also owners of homes in the luxury real estate market.
A Trump victory does not just affect luxury real estate in the great ole’ US of A, but around the world as well. UK investors are starting to turn away from the European Union, which opens up a world of possibilities when it comes to new trade deals between the US and the UK. “We are already seeing over the last four months an upturn in U.K. buyers looking at New York, Miami and L.A,” said Peter Wetherell, chief executive of Wetherill and a leading London real estate broker.
Some worry about another economic shift: the devalued dollar. But for international investors, this may not be such a bad thing. A weakened dollar means a stronger British pound and would increase UK purchases of luxury property in places like the Venetian Islands in Miami.
All we can do is wait and see what surprises Trump has in store for our country. Hopefully, his proposed aggressive financial policies will give the luxury real estate market a nice boost and benefit those who are looking to buy and sell luxury homes across the country.
About the author: Kaya Wittenburg is the Founder and CEO of Sky Five Properties. Since the age of 10, real estate has been deeply ingrained into his thoughts. With world-class negotiation and deal-making skills, he brings a highly impactful presence into every transaction that he touches.