📰The Property Pulse

Welcome back to The Property Pulse! With the 2024 election upon us, this issue dives deep into the candidates' housing policies and their potential impact on the real estate market. Plus, we'll look at the short-term rental market trends.

🏛️ Election 2024: Housing Policy Spotlight on Trump vs. Harris

The 2024 general election is pivotal, with housing taking a rare front-and-center spot. Between the presidential candidates—Democratic nominee Vice President Kamala Harris and Republican nominee former President Donald Trump—the contrast in housing policies could shape the market for years to come.

Kamala Harris’s Vision for Housing

Affordable Housing Focus: Vice President Harris’s housing plan centers on addressing affordability and supply shortages. She proposes constructing 3 million new homes to ease housing constraints. To get there, she plans to work closely with state and local governments to streamline construction processes, reducing delays and bureaucracy. 🏗️

Low-Income Housing Support: Harris emphasizes increasing access to housing through expansions to the Low-Income Housing Tax Credit (LIHTC) program, which incentivizes developers to create more affordable housing. She also aims to provide $25,000 in downpayment assistance for first-time homebuyers, which could empower more Americans to enter the housing market, particularly in higher-cost regions.

Regulating Corporate Landlords: Harris has voiced concerns over the impact of corporate landlords on rental affordability. Under her administration, there could be increased regulatory oversight on large-scale property owners to ensure housing remains accessible and affordable.

Donald Trump’s Approach to Real Estate 

Supply Chain Deregulation: Former President Trump’s plan focuses on reducing costs within the real estate supply chain by removing regulatory restrictions on mortgage lenders and homebuilders. He argues that fewer restrictions will speed up development timelines, enabling builders to respond to demand more efficiently. His proposals also target permitting reform, hoping to reduce the red tape surrounding housing projects.

Immigration and Housing Costs: A key part of Trump’s housing policy links affordability challenges to immigration. Trump asserts that higher demand from immigrant populations puts strain on housing stock and inflates costs for citizens. His proposal includes reducing immigration numbers as part of a broader strategy to keep housing affordable.

Privatizing Fannie Mae and Freddie Mac: Trump has also advocated for fully privatizing the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, which play a central role in the mortgage industry. This move, he argues, could lead to a more competitive lending landscape, but it could also introduce volatility to mortgage rates as the GSEs lose some government backing.

🏠 Election Outcome and Market Impact 

- If Harris Wins: Expect increased federal support for affordable housing, tax credits for developers, and programs to assist first-time homebuyers. Her administration would likely continue advocating for regulatory checks on corporate landlords, which could keep rents stable in high-demand areas.

- If Trump Wins: The emphasis will likely shift to deregulation, aiming to make the homebuilding process more efficient and cost-effective. The effects on housing affordability could vary by region, and privatizing GSEs could lead to a shakeup in the mortgage industry, influencing rates and financing options.

🏘️ Short-Term Rental Market Update

Booming Growth Despite Regulations 

The U.S. short-term rental market hit $64 billion in 2023, up from $39 billion in 2019. But it's not without challenges. Cities like New York are imposing restrictions, barring rentals under 30 days. Meanwhile, markets such as Telluride, Colorado, are rolling back restrictions after noticing economic fallout.

Expert Insights 

Research shows mixed results on Airbnb's impact on affordability. A Harvard study found that a 1% rise in Airbnb listings is only linked to a minor rent increase (0.018%). But in cities like Irvine, CA, short-term rental restrictions led to a 3% drop in long-term rental prices between 2018 and 2021. The takeaway? Market-specific factors make a big difference in whether short-term rentals positively or negatively affect local economies.

🏖️ Fun Fact 

The U.S. now has over 2.4 million short-term rentals, making it one of the world’s largest markets. 🌎 The most popular listing type? Private homes that are entirely available to guests.

In Closing 

As we await the election results, we could be witnessing significant shifts in housing policy. Whatever the outcome, keep an eye on how these policies will impact everything from mortgage rates to rental market dynamics.