Clinton or Trump: Who’s better for housing?

by Ryan Smith03 Nov 2016
There are a lot of issues at stake in the coming election, but of course there’s one that will affect the mortgage industry directly – housing.

So which candidate is better for the housing industry? It depends largely on one’s point of view, since the candidates have espoused different priorities when it comes to the housing market, a real estate expert said.

“What we’ve really got is a more directional conversation: One party talking about affordable housing, the other party talking about deregulating a financial market that seems to have largely seized up,” Rick Sharga, executive vice president of real estate marketplace Ten-X, told CNBC. “It would be nice to see a more holistic view that talks about issues.”

While both issues are important, Jaret Seiberg, managing director at the Cowan Group, told CNBC that homes need to be more affordable and accessible to jumpstart the market.

“I think that means lowering FHA premiums, cutting GSE guarantee fees, doing things to make mortgages cheaper,” he said. “It also means eliminating the perception out there that people can’t qualify for credit.”

While Trump hasn’t said as much about housing as Clinton, his anti-regulation stance could bode well for the industry in one way: the easing of Dodd-Frank regulations.

“…Clearly his whole campaign is about growing the economy and smashing through regulations, so I think you could see real upside with Trump, provided the economy and the other parts of his agenda don’t derail it,”Seiberg told CNBC.

Clinton, meanwhile, has articulated proposals to boost homeownership, which is currently near record lows. Specifically, she favors down-payment assistance to underserved communities. But researchers at Capital Economics expressed doubts that the plan would supercharge homebuying, CNBC reported.

“Specifically, the plan would match up to $10,000 in savings for households who earn less than area median income to put towards a down payment on a first home,” they said. “On the plus side, that will encourage some households to save more. But we doubt it will be a game changer in terms of getting more people onto the housing ladder.”

According to Capital Economics, Clinton’s focus on down payments doesn’t address the fact that many Americans are prevented from buying not for lack of money, but because of onerous credit requirements.

“And even if the proposals do help more people to buy, the eventual outcome will be higher house process, benefiting existing rather than potential homeowners,” the researchers said.


Photo: Rich Girard

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