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Trump Presidency Brings Uncertainty for U.S. Real Estate

Donald Trump officially began his term as the 45th President of the United States on Jan. 20. But having said little during his presidential campaign about his plans for housing, it is unclear, at least for now, just what exactly the Trump era will mean for the U.S. real estate market.

“There is still a lot of uncertainty that surrounds this man and who he is going to be as a leader—a lot of us are going to be scratching our heads,” said John Bryant, vice president of Advocacy, Codes and Standards for the Building Owners and Managers Association (BOMA) during a webinar hosted by Ballard Spahr LLP, a law firm specializing in real estate with offices nationwide.

Despite the general uncertainty of President Trump’s housing agenda, his presidency will nonetheless usher in a period that will require the real estate industry to diligently monitor proposals as they move through the legislative and political process, agreed a panel of industry advocacy groups during the webinar.

The discussion focused on several areas in which Trump has promised sweeping changes that would have a profound effect on real estate—from tax reform and the rolling back of certain regulations, to greater investment in the nation’s infrastructure.

Panelists also discussed how Trump’s career as a real estate developer may differ from his presidential predecessors, specifically as it applies to his approach to management of federal buildings and properties.

“Certainly, the times are changing,” said David Winstead of Ballard Spahr’s Real Estate Department, who moderated the discussion. “We have, for the first time in at least a focused way, a real estate guy in the White House.”

With the Trump Administration in the White House, panelists also said they will be watching to see what comes of Trump’s promises to decrease overly burdensome federal regulations implemented under the Obama Administration in areas such as housing, energy and the environment.

“We’re interested to see what will happen in this new environment on the regulatory front,” said Douglas Bibby, president of the National Multifamily Housing Council.

Other organizations, such as the Commercial Real Estate Finance Council (CREFC), are particularly interested in what the new order in Washington will mean for financial regulations under Dodd-Frank and other federal legislation implemented after the financial crisis of 2008.

“The reality is, be it tax reform or any kind of repeal of Dodd-Frank, all of these issues lend the market to a certain amount of uncertainty,” said Lisa Pendergast, executive director at CREFC.

But while Pendergast is bracing for “volatility in financial markets,” similar to the effects seen in the financial markets following the presidential election in November, some groups are more optimistic about the next four years under President Trump, who has been vocal about his plans to boost job growth.

“We are extremely excited and enthusiastic about the next few years because we want to advance policy that will spur job growth and create demand across real estate sectors,” said Jeffrey DeBoer, president and CEO of The Real Estate Roundtable, a non-profit public policy organization based in Washington, D.C.

The Roundtable’s enthusiasm is based on metrics indicating the health of the U.S. economy, such as improvements in the employment rate and Gross Domestic Product (GDP).

“Even though we are optimistic—we like the economy and what the metrics show—we think [metrics] can be a lot better and we think Washington does offer opportunities to move things forward,” DeBoer said.