Now that some of the dust is settling after a tumultuous election, investors and property owners are waiting for answers. They’re interested in whether the real estate market will be impacted by the Trump presidency and Republican control of both chambers of Congress.
Will anything change? Moreover, will Trump being a real estate man himself have any influence?
With all of the passion expressed during his candidacy, Trump has been relatively vague when it comes to the real estate industry. Regardless, some impacts are expected early next year.
The way it stands now, credit is tight. Interest rates have already gone up this month and the chokehold on lending has been slowing new home purchases for quite awhile. A look at who is getting approved for loans shows mainly those with very high credit scores.
The stock market is up which experts say is evidence of a certain level of confidence. Others say it’s the calm before the storm.
As consumer confidence stabilizes, the GDP should go up and with it interest rates. Hopefully, the rise in the GDP will create more jobs. With more jobs will come more spending and the economy will be further infused. Will this mean anything for the real estate industry?
There’s no denying things have changed over the last decade. Although the market is coming back, fewer mortgages have created a shift in homeownership. Lawsuits on lending institutions in recent years have contributed to more conservative loaning.
If the Trump administration continues with this trend, lenders will respond by tightening the reins. Whether more consumers will have access to mortgages next year—or the year after—will depend on what a government with Trump at the helm determines to be an infraction.
Over the last several years, newly constructed homes have been inordinately higher in price than existing homes. Is the cost of lumber and other materials responsible? It is not, say homebuilders. Prices have gone up due to the higher cost of regulations placed on the industry. Whether this will continue to be an issue will depend on how the Trump administration works to change this.
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