How Trump’s Second Term Could Impact the Real Estate Market

With Donald Trump back in the White House, many homebuyers, sellers, and investors are wondering how his policies might shape the real estate market. Whether you're planning to purchase your first home, invest in property, or refinance your mortgage, understanding these potential shifts can help you make informed decisions. Here’s what we might expect in the coming years.

Tax Benefits for Real Estate Investors

Trump’s administration has historically been pro-business, and if tax cuts for real estate investors are introduced, those who own rental properties or commercial real estate could see bigger profits. Lower taxes might also encourage more investment in housing, increasing the supply of available homes and boosting competition among buyers.

Deregulation for Home Builders

The new administration is likely to continue its push for reducing government regulations, which could benefit homebuilders. With fewer restrictions, developers may be able to construct more homes, especially in suburban and rural areas. However, with relaxed regulations, there may be concerns about building quality and safety standards, making it crucial for homebuyers to conduct thorough inspections before purchasing.

Infrastructure Upgrades Could Drive Home Prices Up

A focus on improving roads, bridges, and public services could make previously overlooked areas more desirable, leading to rising home values. If major infrastructure investments happen, homeowners in growing areas could see increased property values, while buyers might face higher prices in newly developed regions.

Mortgage Rates Likely to Stay Elevated

Interest rates remain a major factor in affordability. With mortgage rates currently around 7%, the cost of borrowing is still high. While some economic factors may lead to slight declines, significant drops in mortgage rates aren’t expected soon. This means buyers will need to budget for higher monthly payments, and refinancing to a lower rate may not be as easy as in previous years.

Rising Construction Costs Could Push Home Prices Higher

If tariffs on imported materials increase, the cost of essential building supplies like lumber, steel, and concrete could rise. This would make new home construction more expensive, potentially leading to higher home prices. As a result, buyers looking at new construction homes may need to stretch their budgets further.

What This Means for You

• Higher Home Prices – With construction costs increasing and potential deregulation in play, the price of new homes could rise, making affordability a challenge.

• More Investment Opportunities – If tax policies favor investors, those looking to build wealth through real estate may find more opportunities.

• Higher Mortgage Costs – With rates remaining elevated, buyers will need to factor in higher monthly payments, and refinancing may not yield major savings.

• Potential for Stronger Housing Demand in Growth Areas – If infrastructure projects improve certain neighborhoods, home values in those locations could see significant appreciation.

Final Thoughts

The real estate market under Trump’s second term will bring both opportunities and challenges. While investors may benefit from tax cuts and deregulation, homebuyers could face affordability concerns due to high mortgage rates and rising construction costs. Staying informed on market trends will be key to making the best financial decision—whether you’re buying, selling, or investing in real estate.

Would you like to discuss how these changes might affect your homebuying plans? Let’s connect!