Presidential Elections: The future uncertain for the Boston real estate industry
Boston Real Estate for Sale
Presidential Elections: The future uncertain for the Boston real estate industry
The subject of housing came up four times during Tuesday night’s presidential debate — all mentions were by Vice President Kamala Harris.
Hosts David Muir and Linsey Davis did not expressly ask either candidate about their housing platform, but Harris pivoted to the topic during her first response of the night.
Harris kicked off by describing her childhood as “a middle-class kid” before transitioning to affordable housing. “Here’s the thing,” she said. “We know that we have a shortage of homes and housing, and the cost of housing is too expensive for far too many people.
“We know that young families need support to raise their children. And I intend on extending a tax cut for those families of $6,000, which is the largest child tax credit that we have given in a long time, so that those young families can afford to buy a crib, buy a car seat, buy clothes for their children.”
Later, when pressed by Muir about her stance on fracking, Harris shifted to housing again. “We are going to work with the private sector and homebuilders to increase 3 million homes, increase by 3 million homes by the end of my first term,” she said.
While former President Donald Trump did not specifically address housing during the debate, he’s previously suggested using federal land for housing development to help meet demand as well as addressing supply chain problems and curbing regulations on homebuilders.
Both candidates have also offered tax incentives as a way to give first-time buyers a chance to enter the housing market. The GOP platform mentions that its plan to curb inflation will lower interest rates to make housing more affordable.
Later in the Tuesday debate, after Trump accused Harris of being President Joe Biden — “She is Biden,” he said — Harris again cast focus on homeownership:
“Clearly, I am not Joe Biden, and I am certainly not Donald Trump. And what I do offer is a new generation of leadership for our country … Let’s talk about our plans. And, and let’s compare the plans … I have a plan that is about allowing people to be able to pursue what has been fleeting in terms of the American Dream by offering help with [a] down payment of $25,000, down payment assistance for first-time homebuyers.”
While Harris weaved in mentions of housing to answers about other topics, Trump often related his responses to illegal immigration. He has previously said that cracking down on illegal immigration will take away some of the housing demand that’s caused pricing to go up. He did not connect the issues of affordable housing and immigration during the debate.
When Muir asked Harris and Trump their last question of the night, about climate change, Harris related the issue to housing for a final time.
“Well, the former president had said that climate change is a hoax. And what we know is that it is very real. You ask anyone who lives in a state who has experienced these extreme weather occurrences who now is either being denied home insurance or is being jacked up,” Harris said. “You ask anybody who has been the victim of what that means in terms of losing their home, having nowhere to go.”
Presidential Elections: The future uncertain for the Boston real estate industry
The presidential election is less than 60 days away and even if one of the candidates is a clear winner at Tuesday’s debate, the fight will get nasty from here on out.
The distraction is likely to cause potential Boston condo for sale buyers to want to wait-and-see.
Thankfully, the hope of lower mortgage rates will keep motivated condominium buyers in the game – but the serious buyers still have hurdles to overcome because the sellers are being tough on price. Why? They have recent sales comps!
It was noted earlier how the market shifted in August a bit.
Peace be with you
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Presidential Elections: The future uncertain for the Boston real estate industry
The presidential election remained too close to call at the time this post was written, leaving the future uncertain for the Boston real estate industry.
In the months leading up to the election, real estate players — perhaps sensing a Biden win or reacting to the president’s response to the pandemic — donated more money to the challenger than to Trump
If Biden Wins: Impact on the Real Estate Market
If Biden wins, he might look to change some well-liked real estate practices. The former vice president has already set sights on dramatically reforming 1031 exchanges, a tax break beloved by the industry, in order to fund child care and elderly care. He plans to limit like-kind exchanges to people making less than $400,000 a year. He has also pledged not to raise taxes on households earning less than that amount — which means taxes on the wealthy are fair game.
Biden has also vowed to reform the Opportunity Zones program, created by the 2017 Tax Cut and Jobs Act, which provides capital gains tax breaks to developers who invest in “distressed” areas.
If Trump Wins: Impact on the Real Estate Market
Should Trump clinch a second term, however, the industry could expect to continue reaping the rewards from those breaks, including those created by the 2017 tax overhaul.
The House Committee on Oversight and Reform called that legislation a “windfall” for real estate developers that would lead to $66.7 billion in gains over 10 years. The law doubled the estate tax exemption, exempted commercial real estate firms from a 30 percent limit on interest deducted by large businesses, and exempted real estate companies from limits on like-kind exchanges. The law is projected to add $1.9 trillion in debt over 11 years, starting in 2018.
Boston Real Estate and the Bottom Line
Regardless of who wins, the next president will be responsible for leading the country through its worst health crisis in a century. Covid-19 has killed more than 230,000 Americans and infected more than 9 million.
The pandemic has also triggered a recession that has wiped out jobs and devastated city and state budgets. The real estate industry has been left reeling, with nearly every single sector — commercial, residential, multifamily, office, hospitality and more — taking big hits.
Some industry bigwigs cited the Trump administration’s handling of the pandemic as a reason to support Biden.
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