Taylor Swift blasted from speakers as hundreds of real estate professionals mulled around a ballroom at the Boston Convention and Exhibition Center, exchanging hugs, smiles and hellos.
They were just a fraction of the more than 10,000 members of the National Association of Realtors in Boston to attend the industry group’s largest meeting of the year: NAR NXT. And just days after former President Donald Trump was elected to the White House for the second time, they were gathering to hear from economists and the future of the housing market.
Even before those conversations started, some attendees expressed optimism by what the election meant for their business.
“Real estate is going to be so good. I really feel like it is,” said Lisa Richardson, an agent from Omaha, Nebraska. “I think he’s going to make America great again.”
The election results come as the residential real estate industry faces many challenges. Between elevated mortgage rates, rising home prices, higher costs for homeowner’s insurance and a limited supply of housing, both real estate professionals and consumers have been looking for a light at the end of the tunnel.
Some agents said Trump's policies will light the way.
“I’m so excited. This is what we needed,” said Staci Schwittay, an agent with eXp Realty from Ponchatoula, Louisiana. Asked what she thinks Trump will do for the housing market, Schwittay had a two-word answer: "rate drops."
During his campaign, Trump said his party would combat housing affordability and help new homebuyers. His administration pledged to reduce mortgage rates by slashing inflation, opening some federally owned land to new construction, promoting homeownership through tax incentives and cutting “unnecessary regulations that raise housing costs.”
Rate challenges
In a speech to agents Friday, Lawrence Yun, chief economist of the NAR, said fixing the nation's housing market won’t be easy.
“Mortgage rates in the first Trump president term was ‘good-ole days,’ 4% mortgage rates. Are we going to go back to 4% mortgage rates?” he asked. “Well, my forecast, unfortunately, is not.”
Yun instead forecast that mortgage rates are likely to hover near the 6% threshold, a result of an existing larger-than-usual budget deficit because of the high level of spending during the COVID-19 pandemic.
That deficit is projected to grow. At the end of October, the nonpartisan Committee for a Responsible Federal Budget estimated that the president-elect’s proposed tax changes would widen the deficit by about $7.75 trillion.
“The private capital that was able to lend the money out is getting soaked up,” Yun said. “There will be less mortgage money available because government is borrowing so much of that money, so large budget deficit will prevent the mortgage rate from going back down.”
Some agents at the conference agreed. Steve Alexander, for example, said he has a hard time seeing past the president-elect’s history, and he also sees the budget deficit as a challenge.
“That’s not good,” the associate broker with Keller Williams from Bethany Beach, Delaware, said. “That just does not help our country in the long term, right? And so while you can maybe artificially stimulate or manipulate interest rates, at some point, you gotta pay.”
Even so, there are some ways Trump could help the housing market, and he’s already signaled his possible commitment to some of those strategies, Yun said.
For one, Trump has vowed to cut red tape for homebuilders, making it more affordable and easier to construct new houses. He’s also said that he would be open to freeing up federally-owned land for building.
But for some agents, the president-elect’s experience in real estate gives them hope for the future.
“I really believe Trump loves America,” said Richardson, the agent from Nebraska. “And I think he loves real estate. I do. I think we’re going to be good.”