As we step into 2025, real estate professionals, investors, and potential homebuyers are all eager to see how the market will change under the leadership of President Donald J. Trump.

Known for his business approach and previous term’s economic strategies, Trump’s policies are poised to influence the housing market, commercial real estate, and development in distinct ways. With technological advancements, shifting demographics, and economic factors, it’s important to understand the impact of the new administration’s approach and how this might affect you.

Tax Cuts and Incentives for Real Estate Investors

Through Scott Turner’s leadership as current HUD Secretary, is basically, looking to streamline the approval process for development projects, including:

• Potential tax cuts for real estate investors, especially those in commercial properties or large-scale developments
• Increased depreciation incentives, allowing investors to write off property costs faster
• Changes to the capital gains tax that might favor short-term and long-term investors, further encouraging investment in both residential and commercial real estate. These changes could stimulate real estate purchases and developments, particularly in high-demand areas or those poised for significant growth, although these tax breaks will reach and impact the most rural areas like northern New Mexico.
• Streamlined Development Processes
• Basically, Opportunity Zones help streamline the approval process for development projects, including:
• Fewer environmental regulations or relaxed zoning laws, which could make it easier for developers to build new residential and commercial properties
• Accelerated permitting processes for large-scale real estate projects, including office buildings, apartment complexes, and luxury developments
• Looser construction codes or exemptions for specific types of buildings, allowing for faster and less costly construction

This deregulation could lead to an increase in new construction projects, particularly in rural areas where there is demand.

Commercial Real Estate and Infrastructure

Trump’s prior term revealed significant emphasis on infrastructure improvements, particularly in transportation and energy sectors. If this continues in 2025, the commercial real estate market could see benefits from federal investments in infrastructure:

• New investments in highways, ports, and airports could enhance the value of commercial real estate near those developments, especially logistics and distribution centers
• Greater focus on energy efficiency in commercial buildings, with tax incentives or federal grants for energy-efficient technologies
• Foreign Investors and Immigration Policies
• Trump’s administration has shown a strict approach to immigration and foreign investment. This could have great effects on real estate markets, particularly in cities which attract international buyers and investors, not to mention the impact we might see from harsh immigration policies.
• Reduced foreign investment: If immigration restrictions and visa limitations continue or increase, international demand for luxury real estate could decrease as well as foreign buyers.
• Delays in construction projects: Strict immigration policies could limit the availability of labor, leading to delays in the completion of new developments. This is especially true for affordable housing projects, which often rely on a large number of skilled and unskilled immigrant workers. A reduction in available labor could drive up construction costs or lead to stalled projects.
• Increased construction costs: With a smaller labor pool, developers may face higher wages for construction workers, raising the overall cost of building homes, apartments, or commercial properties. This could lead to higher housing prices for both buyers and renters.

it’s clear that 2025 will be a year of adaptation, shaped by shifting policies, and market-driven solutions that inspire growth across all real estate sectors, from commercial to residential. Ultimately determining the future of real estate in rural regions like northern New Mexico is still very unknown—as it is for all of the U.S. The hope is that with tax benefits and fewer regulations, affordability for homeowners is on the horizon.