Summary
The probability of Trump becoming the next president has increased from 65% before the assassination attempt to 80%. Investors will get excited about the continuation of the existing flat 21% federal corporate tax rate or a potential cut in the tax rate. With potentially lower corporate tax rates, corporations will be able to boost their profits.
Strategically, you want to buy the dips. At the margin, President Biden is seen as a much tougher fighter against monopolies than Trump. With pent-up demand, a strong economy, and declining mortgage rates, there should be significant demand driving both residential and commercial real estate.
If there is a melt-up in the stock market, it will boost consumer wealth and help bring up real estate prices. A decline in stocks may also push up real Estate performance due to sector rotation. Under a Trump presidency, the fear of income taxes increasing should diminish.
If the frenzy in risk assets continues under Trump and interest rates come down, then cash will be a significant underperformer. There is supposedly a record $6 trillion in cash sitting on the sidelines. A Trump presidency could once again rejuvenate interest in investing in the heartland of America.
Whether a Democrat or a Republican is in the White House matters less for your investments than you might think. The S&P 500 has performed well under both parties. The biggest factor in your ability to grow your wealth is YOU, not the president. You control your saving rate, work ethic, and career choices.
If you're interested in diversifying into heartland real estate, check out Fundrise. Fundrise manages over $3.3 billion for over 500,000 investors. The majority of its investments are in the Sunbelt and Heartland. There are better deals to be had today than in 2021 and 2022.
