With the 2024 presidential election drawing closer, understanding each candidate’s stance on housing can help you make more informed real estate decisions. The housing policies of candidates Kamala Harris and Donald Trump reflect distinct approaches to affordability, homeownership, and zoning regulationākey factors that will shape the real estate market in the coming years.
šļø Kamala Harrisās Housing Policy & Market Impact
Vice President Kamala Harris, the Democratic presidential nominee, has presented a comprehensive housing plan with an ambitious goal: ending Americaās housing shortage by the end of her first term. Hereās how her proposals could shape the market:
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Development of 3 Million Homes
Harrisās plan includes a $40 billion federal fund to build affordable homes and repurpose federal land. By incentivizing developers to create starter homes and affordable rentals, her strategy aims to counter the supply shortage that has driven up home prices nationwide.- š” Buyer Insight: Increased housing supply over time could ease price pressures, especially in high-demand areas. Buyers might find more entry-level homes available, with a reduction in bidding wars.
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Down Payment Assistance for First-Time Buyers
Harris has proposed offering up to $25,000 in down payment assistance for first-time homebuyers, designed to lower entry barriers to homeownership.- š” Buyer Insight: This initiative could make homeownership more accessible to low- and moderate-income families. With lower down payment requirements, more people can qualify to buy homes, though demand pressure might persist in some regions.
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Targeting Corporate Landlords
Harris aims to address the influence of corporate landlords in the housing market, particularly in metropolitan areas where their presence may increase rental prices.- š” Renter Insight: Policies limiting corporate landlords could potentially stabilize rental prices in high-density urban markets, making rental units more accessible. However, itās unclear how corporate landlords will respond or if this will have significant impacts outside of large metropolitan areas.
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Reducing Regulatory Barriers to Housing Construction
Harrisās focus on zoning and land-use reform signals her intent to encourage states and cities to ease building restrictions, particularly in regions with chronic housing shortages.- š” Market Insight: If enacted, her zoning reforms could open up new development opportunities in historically restrictive areas, promoting a mix of housing types that may ultimately broaden buyer and renter options.
š Donald Trump’s Housing Policy & Market Impact
Donald Trumpās housing approach reflects traditional conservative priorities, emphasizing local control and deregulation. Hereās how his potential policies could shape the housing landscape:
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Preserving Single-Family Zoning
Trump has historically defended single-family zoning, advocating against high-density developments in suburban neighborhoods. His rhetoric suggests a preference for protecting suburban areas from state or federal mandates on zoning.- š” Seller Insight: Trumpās policies could preserve property values in suburban neighborhoods by limiting high-density developments that might otherwise increase competition in these areas.
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Deregulation and Developer Incentives
While specifics are limited, Trumpās pro-deregulation stance may prioritize easing building codes and regulations to speed up new housing development, especially in red states where zoning laws are often less restrictive.- š” Investor Insight: Investors may see fewer regulatory hurdles in markets aligned with Trumpās policies, potentially encouraging suburban or rural developments. These areas could become attractive for new residential and mixed-use projects if local autonomy over zoning is preserved.
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Interest Rate Advocacy
Trump has criticized current mortgage rates, suggesting that high interest rates are a significant barrier to affordable housing. His support of lower interest rates might appeal to buyers struggling with the cost of financing.- š” Buyer Insight: Although the president doesnāt control mortgage rates directly, Trumpās policy stance could influence federal approaches to rate control, potentially benefiting buyers in need of lower borrowing costs.
š Broader Election Impact on Real Estate
Beyond the specific policies, elections can significantly impact real estate through broader economic confidence, tax policy, and mortgage rates. Hereās what to watch for:
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Tax Reforms Affecting Real Estate
The 2024 elections could introduce tax reforms that affect homeowners and investors alike. Potential changes include adjustments to homeowner tax deductions, capital gains taxes on investment properties, and incentives for sustainable housing.- š” Investor Insight: Investors should monitor any proposed changes to capital gains taxes, as these could alter the profitability of rental or flipped properties. Homeowners could see shifts in property tax deductions that influence the affordability of homeownership in certain regions.
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Housing Affordability and Federal Investment
Housing affordability remains a significant election issue, with both candidates acknowledging it. Potential federal investment in affordable housing could bring relief to buyers in densely populated, high-demand areas.- š” Renter Insight: In markets where affordability programs are prioritized, renters might expect increased availability of affordable units, although effects will vary depending on local implementation and market conditions.
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Mortgage Rate Uncertainty
The election outcome could influence Federal Reserve policies that impact mortgage rates. Historically, election cycles tend to cause short-term rate fluctuations, but buyer and seller confidence tends to stabilize by year-end, with many deciding to proceed with their plans.- š” Market Insight: If mortgage rates decline slightly around election time, this could be advantageous for buyers ready to act in November or December. Sellers might see higher activity in the post-election period as buyer confidence stabilizes.
š Historical Context: Real Estate & Elections
Elections often bring a temporary pause in real estate activity as buyers and sellers await the outcomes and potential policy changes. For example, the 2008 election coincided with the financial crisis, and the 2020 election saw pandemic-related impacts. Each event caused unique shifts in real estate trends, underscoring the influence of policy on the housing market.
- š” Market Insight: Understanding how these cycles play out can help both buyers and sellers make strategic decisions. Election years can be opportune for buyers to act on potential rate dips, while sellers might capitalize on post-election demand as confidence returns to the market.