Grant Cardone Reveals 3 Ways the Election Could Affect the Real Estate Market
Written by
Gabrielle Olya
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Levi Leidy
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Grant Cardone, private equity fund manager and real estate investor, believes that the outcome of the election could shake up the state of the real estate market.
“[The] election has nothing to do with real estate, but confidence does,” Cardone, who will be hosting the 10X Growth Conference 2024 in April, told GOBankingRates. “If Joe [Biden] gets in, real estate will stall out. If [Donald] Trump gets in, real estate will jump.”
Here’s why Cardone believes a Trump win would be a good thing for the U.S. real estate market.
Debt Will Boost the Real Estate Market
Cardone believes that Trump would be willing to take on more debt than Biden, which would ultimately boost the real estate market.
“Donald Trump is a debt guy,” he said. “He loves debt. He’s benefited from debt. He’s restructured debt. I don’t think he worries about debt too much. He borrowed $7 trillion during COVID to get us through that without even a blink of an eye. And loose debt is great for real estate, whether you like it or don’t like it. It’s great for real estate.
“You can’t just go out and bring a billion dollars to a closing,” he continued. “Those deals are done with debt. And when debt’s moving, deals can get done.”
Trump Will Push for Lower Interest Rates, Which Will Translate to Lower Mortgage Rates
Cardone predicts that interest rates will be lowered if Trump is elected president.
“Trump will hammer the Fed even though he doesn’t control the Fed,” he said. “He will embarrass the Fed, which should be embarrassed by the way, to lower interest rates because interest rates have to get lower. They must get lower in order for America to function.”
Right now, high interest rates are translating to high mortgage rates, which is keeping many people out of the market.
“That’s why homes aren’t moving,” Cardone said. “Homes will move if debt was cheaper.”
As Rates Drop, Homes Will Become More Affordable
Although many experts believe that a drop in interest rates will eventually lead to an increase in home prices as more buyers flood the market, Cardone doesn’t think this is the case.
“When interest rates get to 4%, home prices will go down, not up,” he said. “Nobody believes it. I’m a contrarian on this. When interest rates hit 4%, and they will, we’ll get back to selling homes again. Homes are just not selling right now because banks are not giving loans. The market’s frozen and activity’s not happening.
“When there’s more supply in the market, the prices come down,” Cardone continued. “So a lower interest rate will actually save the housing market and save the mortgage industry. That’ll get things moving again.”
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