Donald Trump’s Impact on the Australian Property Market

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Donald Trump’s Impact on the Australian Property Market
I am really not a Trump-man. Apart from his vulgarity, when it comes to the nation’s economy, I dislike showmen. I felt the same about Blair and Rudd.

But months before taking office, Donald Trump is already having an impact on property – and this is just a taste of things to come.

According to Digital Finance Analytics US mortgage rates have risen by more than 50 basis points since the election
Donald Trump’s Impact on the Australian Property Market

Source Digital Finance Analytics

And it’s likely to be the same over here; on Friday Westpac announced significant hikes to its fixed rates loans. Other Australian banks are expected to follow suit.

Trump’s election is really likely to stoke the economic fires. According to AMP’s Chief Economist, Shane Oliver “The Reaganesque combination of big tax cuts and increased defense and infrastructure spending will provide an initial fiscal stimulus and, with reduced regulation, a bit of a supply side boost to the economy.”

As a result the bond market is already expecting more which is likely to increase rates. This could well cool down the property market. That said, if Trump really boosts the economy, property could keep growing like Topsy.

That said, since Trump’s victory, the ASX has also shot up from 5,150 to 5,500 – investors may become more interested in shares than property.

And just to confuse things, given Trump’s construction background plus his commitment to infrastructure, maybe he will stimulate the resource states whose commodities roar back into demand.

We don’t know really know what we will get from Trump (and he probably doesn’t either). But, even a modest investment property in Kickakanalong will be affected.

 

Graeme Salt - Chan & Naylor Finance

Disclaimer: This article contains general information; before you make any financial or investment decision you should seek professional advice to take into account your individual objectives, financial situation and individual needs. Click for more detail regarding this disclaimer.

One response to “Donald Trump’s Impact on the Australian Property Market”

  1. Liz Ford says:

    Trump’s influence on real estate – the most valid prediction is, no one knows – not even Trump himself!

    I favour my money being in real estate over all else – it’s tangible. It can house me, I can feed myself from the soil, and hopefully harvest water, I can use solar power so I am not dependant on a corporation to keep the lights on; it’s value hopefully keeps pace with inflation; I can trade it. My children can inherit it – it’s not just a promissory note! That’s why it is called REAL estate.

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