Donald Trump has finally been sworn in as the new president of the United States. Ever since his election victory though, many people in the mainstream media have been saying that he will be bad for the property market. Is that really the case? Today I’m going to cut through the confusion, show you what happened last time Donald Trump became president, and give you the four things you need to consider so you can make an informed decision.

Let’s dive in. Hello, it’s Niro here and if you’re new to my channel, hit that subscribe button because I talk about all things related to the Australian property market and the economy. As I said, there are four things you need to consider. Number one, is Trump’s proposed policy about putting a 60% tariff on China.

Here’s what the RBA has to say about that. The Reserve Bank believes Donald Trump’s clean sweep in the US election will slow Australia’s economic growth and domestic inflation, driving down interest rates and the value of the Australian Dollar. Documents released under freedom of information laws reveal the RBA’s international department warned in an October 10 meeting, so that was last year, that Mr. Trump’s promised 60% tariff hike on Chinese imports will have relatively strong negative implications for Australia given the strength of export trade links.

Now why would that have an impact on Australia? Well, if China can’t export as much of its products to the US because everything becomes now 60% more expensive, well then they’re not going to need as much resources, primarily from iron ore and coal.

And we know that China is our biggest buyer of those resources. So that means that Certain markets, say potentially in Western Australia, where local economies have a big dependence on mining, could be negatively impacted and you could see property prices potentially start to stall or even go backwards.

Now, I’m not saying that you shouldn’t necessarily buy in Western Australia or potentially buy in Queensland. Those markets still very, very strong. However, you do need to do your due diligence and look at the risk. Does the area that you’re buying in have enough economic diversity so that if this tariff does come through and there are impacts, how much will the local area looking to buy in be affected?

Number two, Trump’s America first policy, which essentially means that he’s planning on putting 10 to 20% tariffs on anything that America imports. Now that could have a minimal impact on Australia because we don’t export as much to America as we used to. But it will still be another challenge to our GDP.

The growth there hasn’t been great in recent times. And so, what will happen is that our goods that are exported to America will become 10% more expensive because of the 10% tariff. Now how could this be offset though? Well, it could be offset by a falling Australian dollar. If our dollar continues to fall, this could offset the impact of those tariffs.

But what’s the other thing that could help ensure this happens? If the RBA was to cut interest rates, that would further than bring our dollar down, which could potentially offset the impact of the America First policy and those 10% tariffs. Number three. Trump may end up bringing down inflation on a global level through his cry that we saw throughout his election, Drill, baby, drill.

Having taken the oath of office, the President declared an energy emergency in the U. S. and repeated a rallying cry of drill, baby, drill from his successful election campaign. He urged U.S oil and gas companies to ensure America’s energy security and economic prowess, and noted, We are a rich nation. It’s that liquid gold under our feet that will help us ensure that we keep things that way.

America will be a manufacturing nation once again. We sit on the most oil and natural gas of any nation on earth and we’re going to use it. So, if Trump follows through on that and we see more drilling in the US, what that means is that we’ll will increase the supply of natural resources on a global level, especially oil and gas.

Now, what that means is that energy prices on a global level will start to fall against supply and demand. When you have more supply of these, resources that will then bring down the price. But remember, energy prices pretty much affect everything from how much we pay at the petrol station to fill up our tanks to anything else around the country.

So, if energy prices fall as a result of what Trump is planning, you are very likely going to see inflation fall on a global level. We already know that inflation has fallen in Australia. Now, if energy prices were to fall again, you will see inflation fall further, which means the RBA will have no choice but to drop interest rates.

And number four, just who Donald Trump is. Let me explain what I mean by that. Now, whether you like Trump or whether you don’t, there is no doubt there are plenty of people around the world who are triggered by Donald Trump, they don’t like what he stands for, all of that.

So, what you’re going to see is that a lot of people who want to migrate to America, and I’m talking about legal migration here. We know that Trump is clamping down on illegal migration. I’m talking about people wanting to migrate to America legally from India and other parts of Asia. A lot of them will now start to reconsider, because they may not want to move to the US because of fear around what Donald Trump might do and how that might adversely affect them.

So, then what could that trigger? Well, that could trigger increased demand in Australia from migrants because Australia has always been seen as a safe haven. We’re not as politically polarizing as Donald Trump is or some of the other countries are around the world.

So, although migration might have fallen slightly in recent times, we know that it’s still well ahead of long-term levels, and if migration was to tick up again, because people start choosing Australia over America as a place to live, that will then place more demand on property. So, in summation, we’re going to see more downwards pressure on inflation from the American first policy and the 10% tariffs on anything imported into the country.

We’re going to see a bigger impact potentially from what’s going to happen to China and the tariffs that Trump will place on China, which again will impact our GDP and force inflation to fall faster. Number three, it’s quite likely we’ll see the price of energy fall, which will again, bring inflation down.

So, all these three factors are quite likely to force the RBA to bring interest rates down faster than they have indicated in all of their press releases. And then we also have a strong chance that migration could increase, or at least there’ll be more interest in people wanting to migrate to Australia.

We know we have a housing crisis already in this country. We’re not building enough properties. We’re about 30% below the prime ministers. Now with all these factors set to happen, I think Trump’s presidency could really trigger strong upwards pressure on property in multiple areas around the country.

If that sounds unlikely, think about what happened last time when Donald Trump was sworn in as president back in 2016, what happened to property prices? I mean, I bet that if you could look back right now, wouldn’t you have wanted to buy property at least in one of our major capital cities or larger regional areas because prices today are way more expensive than they were back in 2016 and yet right now interest rates are at the highest they’ve been at for over a decade.

So, with everything that Trump has planned, I expect you’ll see interest rates start to fall plus potentially more demand from people coming into the country needing a place to live in. So personally, I think Donald Trump could trigger various events that end up making Australian property prices even more expensive than they are right now.

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Financial disclaimer: I am not your financial advisor and the opinions I share in this video are purely my opinions. This is not to be considered personal advice as it is general in nature.