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Real Estate Strategies

What the big, beautiful bill means for real estate

How Trump’s tax law will help (and hurt) the housing market.

trump signing big beautiful bill

Samuel Corum/Stringer/Getty Images

4 min read

Now that President Trump’s massive tax bill has been officially signed into law, real estate investors might wonder what the upshot is for them.

Overall, the law is viewed as a win for real estate, with endorsements from housing industry leaders including the National Association of Home Builders and the National Association of Realtors. Many investors also applauded the bill, calling it a “windfall” and a “game changer.” Here’s what investors stand to gain, and lose, and how they’re preparing.

100% bonus depreciation restored

Trump’s One Big, Beautiful Bill (OBBB) restored 100% bonus depreciation and made it permanent. “This way, real estate investors can break a property into depreciable components—HVAC systems, appliances, land improvements—which can be fully deductible in year one, which saves tens of thousands in taxes upfront,” explains Mark Lee, partner at Absolute Properties.

“The return of 100% bonus depreciation is a game changer,” agrees Stephen Keighery, founder of Home Buyer Louisiana—particularly for house flippers. “This bill creates an opportunity to offset house-flipping income by acquiring and renovating rental properties. It’s accelerating my decision to buy more, and in speaking with other investors, I’m seeing a similar mindset.”

SALT deduction caps increase

The megabill boosts state and local tax (SALT) deduction caps from $10k to $40k, allowing real estate investors to save more on property taxes until 2029. While temporary, this update is a bonanza to investors in high-tax states like New York, New Jersey, California, and Massachusetts.

“Bonus points if you own through an LLC or S corp, since there’s a pass-through entity loophole that lets you sidestep the cap altogether,” says Carla Gericke, an agent with Porcupine Real Estate in New Hampshire. As a result, “We’ll likely see a bump in luxury home and commercial property demand in those high-cost markets. When the tax math improves, so does investor appetite.”

Low-income housing tax credits and breaks expanded

Affordable housing scored a couple of victories. Caps were raised on the Low-Income Housing Tax Credit, which can result in significant savings for investors who build or rehabilitate low-income housing.

“These changes are expected to produce or preserve more than 1 million additional affordable rental homes between 2026 and 2035,” says David Dworkin, president and CEO of the National Housing Conference. States will also be able to set new Qualified Opportunity Zones, offering tax breaks to investors for developing or improving housing in low-income areas.

Deductions on mortgage insurance restored

Another reinstated deduction was for mortgage insurance, which is typically required with down payments below 20%. The last time this fee was deductible in 2021, taxpayers saved an average of $2,364, according to US Mortgage Insurers.

Infrastructure updates

The OBBB is expected to funnel federal funding into infrastructure, which will have a ripple effect through real estate. “The immediate move I’m seeing investors prepare for is zoning and land use adjustments near those funded projects around major transportation corridors,” says Mark Sanchez, a real estate manager at Gator Rated in Florida. “I’m already looking at land parcels within 10 to 20 miles of potential development zones tied to this bill, like the stretch east of Orlando, around the State Road 528 corridor. Some of the parcels are still zoned for agriculture, but they’re right in the path of planned developments. That kind of growth usually draws rezoning interest pretty quickly. Rezoning changes property values fast.”

Higher interest rates

Although the overall picture appears positive for investors, some are bracing for potential downsides, like rising inflation and stubbornly high interest rates.

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“I expect this bill, in conjunction with tariffs, to drive inflation up,” says Jason Hull at J&J Cash Home Buyers. “Combine this with the immigration crackdown, and I expect the cost of building new homes to go up over the next few months.” To prepare, he’s pivoting away from flipping to rentals, pointing out, “Rents tend to keep pace with inflation, making them a good inflation hedge.”

“My opinion is that interest rates impact investors more than changes to the tax code,” adds Jonah Hanig, CEO of Rove Travel. “With investment properties, the tax changes present a slight tailwind, but pales in comparison to the benefit investors would see from lower interest rates. Many investors are waiting for rates to come down to refi or make new purchases.”

The Great Wait for lower rates continues…

Let’s Make a Game Plan

Boost your investment game with expert real estate insights. We'll keep you up to date on everything you need to know to be the smartest real estate investor you can be.