Tax reform is front and center on the congressional agenda, and there is a real chance it will become law this year. The last comprehensive tax reform legislation was the Tax Reform Act of 1986 (TRA 1986) signed into law 30 years ago by President Ronald Reagan. We all remember how that bill devastated the industry for years, so it is imperative that we engage with policymakers to ensure a more positive outcome.
Uncertainty dominated the commentary written by key real estate analysts trying to forecast how the apartment industry and economy overall will be affected by the election of Donald Trump as the next U.S. President.
Most industry groups, admittedly, said they were caught off guard by the result, and they, no doubt, will continue to analyze the situation between now and January’s Inauguration Day.
The fact that Trump has never held a public office and that many say he manages impulsively, among other things, has caused most to suggest there is an even greater factor of unpredictability going forward.
Writes columnist Michael Gerson in The Washington Post, “Hillary Clinton proved incapable of defeating a reality-television host whom more than 60 percent of Americans viewed as unfit to be president.
The election’s result has created a rare one-party, four-way control of the federal government (House, Senate, Executive and Supreme Court) and the continuation of the GOP’s domination of state governments and governor houses. (See “By the Numbers”).
Adds columnist Eugene Robinson, writing in The Washington Post, “Some of the nation’s most diverse and populous states, including Texas and Florida, are living under one-party Republican rule.”
New York Post columnist Kyle Smith points out, “What kind of president will Trump be? It’s a tad too early to say, isn’t it? The media are supposed to tell us what happened, not speculate on the future.”
While it certainly is too soon to speculate what impacts the Trump Administration could have on the industry and the broader economy, following is a summary of thoughts and projections expressed during the 12 days following the Nov. 8 election.
Moderation is the word across several apartment market metrics through the first half of 2016. According to MPF Research, annual rent growth slowed somewhat to 4.5%, compared to 4.9% at this time last year. This is still an impressive figure given the duration of the growth cycle, as well as the 15-year average growth rate of 2.4%. Absorption outstripped new supply and occupancy rates inched up 20 basis points to 96.2% after weakening late last year and into the first few months of 2016, exhibiting the continued resilience of apartment market fundamentals.