Soon a new president will be elected, and the race is starting to heat up. For landlords and property owners, it’s important to understand how the 2016 presidential race will impact the industry. Hillary Clinton, Bernie Sanders, Donald Trump, and Jeb Bush are leading in polls in a very crowded field, and each has different views on the real estate market that could affect you if elected.
Donald Trump’s name is synonymous with real estate, the industry in which he made his fortune. As a result, it’s very likely that he would take a business-friendly and real estate-friendly attitude if he were president. In fact, he has taken an extremely negative view of tax reforms that remove tax shelters for real estate, and he is deeply opposed to a new law in the works that would end like-kind exchanges that allow deferrals on capital gains from real estate sales. Trump has also called for the following policies:
Jeb Bush generally has a pro-business approach similar to other Republican candidates. He also has real estate experience, serving as a consultant to a number of real estate companies and running a successful commercial real estate enterprise. While Bush’s tax policies remain unclear, these policies would likely involve tax cuts; however, he is currently the only GOP contender who has refused to sign Grover Norquist's famous anti-tax pledge.
As governor of Florida, Bush pushed through $13 billion in tax cuts, many of which went to the richest residents of the state. Given Jeb Bush’s experience, it is likely that he would maintain and implement real estate-friendly policies, but specifics are still hazy.
Hillary Clinton is currently the top Democratic primary contender, but her potential impact on the real estate market is also not entirely clear. In general, a Clinton presidency will likely result in higher taxes on wealthy individuals, while small businesses are expected to receive tax cuts. She is seen as a moderate Democrat and is relatively business-friendly, which might be due to her large support from corporate donors. For example, she promised no tax increases for those earning under $250,000 a year in 2008 and also voted to raise taxes on those earning more than $1 million. As a result, a Clinton presidency may maintain the status quo for smaller landlords, whereas larger landlords may see higher taxes.
Bernie Sanders may be a long shot, but he is the number two contender in the Democratic primaries. If Sanders were to win the presidency, it’s highly likely that his presidency would have the biggest impact on the real estate market overall. He touts that he grew up in a rent-controlled apartment in Brooklyn and may be interested in strengthening laws to protect tenants. Based on his past voting behavior, he may also increase taxes on real estate deals and individuals with high incomes.
In fact, Sanders was apparently inspired to get involved in politics due to rising rent in his own apartment, and he was involved with an unsuccessful attempt to introduce a rent stabilization ordinance when he first entered politics.
Overall, the presidential primaries are shaping up to be interesting, and the impact of the presidential election will likely reverberate through the real estate and property management industry for years to come. LandlordStation will keep readers up to date on major political developments and how they’ll impact landlords and others involved in the real estate business as the race develops.
* Image courtesy of www.personalincome.org
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