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NAHREP has reasons for both optimism and concern about a second Trump term:
- Realtor Lawsuits – Net Positive
While it’s far too early to know how a Trump DOJ will address issues like broker compensation cooperation, the Clear Cooperation Policy, or other antitrust issues, the consensus is that a Trump administration would be more favorable to the industry. NAHREP will continue its leadership in ensuring that policymakers at the DOJ and Congress know how these potential new business rules impact Latinos and first-time homebuyers.
- Interest Rates – Net Neutral
While the stock market initially responded positively to Trump’s election, the bond market was less enthusiastic. Concerns that Trump’s tax policies and tariffs will lead to increased deficits and renewed inflation. Last week, the Fed lowered interest rates by a quarter of a percent but signaled that future cuts are uncertain.
- Deportations – Net Negative
Trump’s commitment to mass deportations is a reason for concern. The cost and complexity of deporting 10 million people would be enormous, and the impact on the economy would be devastating. The greatest impact would be on the construction industry. Overall, mass deportations would cause inflation to skyrocket, services to suffer, and the economy would likely dive into a recession.
If Trump doesn’t know this already, he will find out soon enough. A more likely scenario is a significant slowdown in illegal immigration and a modest increase in deportations. In his first term, Trump said he built a wall that doesn’t exist. I would guess that in his second term, we will see some high-profile deportations of gang members and criminals, and Trump will claim that millions of immigrants self-deported out of fear of him.
Overall, the country needs more workers, and the only way we can meet this demand is through immigration. People come to this country illegally because there are jobs, and our legal immigration system is broken. At some point, our dysfunctional relationship with immigration will have to be resolved.
- DEI Programs – Net Negative
Less than five years after the George Floyd murder inspired billion-dollar corporate commitments towards programs that aim to close racial wealth and prosperity gaps, less committed corporations have ended DEI programs and terminated DEI staff. A Trump administration will likely exacerbate this trend. NAHREP views this as an opportunity to grow and expand its relationships with corporations because of its scale and success in providing tangible business opportunities. Despite these headwinds, NAHREP will continue to advocate for diversity in an industry where all the growth comes from diverse communities nationwide. DEI budgets may dwindle, but corporations needing growth will continue to pursue partnerships with large, well-managed organizations like NAHREP.
- Conclusion
The housing market will continue to be challenged by affordability issues primarily driven by inventory shortages. The threat of mass deportations could make it harder for builders to recruit construction workers and will likely drive up labor costs.
However, a positive resolution related to agent compensation would relieve agents and get confused and hesitant buyers off the fence, thereby increasing overall transactions. Real Estate agents will continue to be major influencers in Hispanic communities, guiding a variety of financial decisions.
NAHREP intends to invest substantially in its Hispanic Wealth Project to ensure our members are armed with the best information and resources related to much-needed wealth-building principles.
The Trump team has not provided much detail on any housing policies. Issues like privatizing Fannie Mae and Freddie Mac are still up in the air; however, if inflation remains in check and mass deportations fail to materialize as I expect, Trump’s promise of deregulation and lower taxes will be a net positive for housing.
2025 should be a solid year for housing and a strong one for NAHREP.
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