The Trump Effect: Is His Presidential Bid Hurting His Real Estate?

Whether you adore or despise him, Donald Trump displays a rare talent for inflaming political passions on both sides. But as he barrels his way to the Nov. 8 presidential election, his considerable luxury real estate holdings have seen a drop-off in sales.

Could his scorched-earth campaign and its many controversies be the culprit?

There was a 13.8% fall in the number of sales nationally in the roughly two dozen U.S. properties listed on the Trump Organization’s website in the first six months of 2015 compared with the first half of 2016, according to a realtor.com® analysis. (The mogul licenses his name to many more developments, which weren’t included.)

When it comes to dollars and cents, the number is less bleak: The median sale price of his residential properties dipped nearly 4.2%.

In Trump’s home state of New York, a Democratic stronghold, the number of sales in his buildings (he has about a dozen) fell by nearly 17.1%. But sale prices were up 39.59%.

The primary reason for that New York bump was the single blockbuster sale of a $14.8 million condo on the 86th floor of the Trump World Tower in Manhattan. The Voyage Investment Group bought it earlier this year.

“Growth in sales in Trump buildings [in New York] has been boosted by big investment groups more than individual buyers,” says Javier Vivas, realtor.com’s manager of economic research. “Many of these multimillion-dollar sales come from foreign buyers. They don’t typically care about American politics.”

These sales numbers were tallied before a 2005 “Access Hollywood” video clip of Trump lewdly boasting was made public, and before several women came forward to say that he had groped them. (Trump denied doing so.)

Is the challenge heated rhetoric, or changes in the luxury market?

Ultimately, it might not be the candidate’s verbal scuffles with everyone from House Speaker Paul Ryan to the Muslim parents of a slain U.S. soldier that present the greatest risk to Trump’s housing portfolio, according to luxury real estate experts.

A bigger factor might be the properties themselves. Luxury real estate agents in Manhattan say that the older Trump properties have lost some of their cachet.

The Trump buildings seem dated next to New York’s new crop of amenity-laden luxury towers, say luxury agents. The most recent of the buildings listed on his organization’s website, the Trump SoHo in Manhattan, was completed in 2010.

“They’re considered generic, upper-middle-class properties,” says a real estate expert who spoke on the condition of anonymity. The expert noted that Trump buildings have similar lobbies and features—like a chain. “It’s like a formula and it works, but … times have changed.”

These days, luxury buyers want to live in even more spacious units in taller buildings. And they want more outdoor space—be it on a roof or terrace, or below the building.

“The upper end of what’s being built now is not comparable,” the source says of the newer, more modern finishes and amenities offered in today’s luxury buildings.

Overall, the U.S. luxury market has been softening, with fewer sales and falling prices. There are fewer foreign buyers as of late due to a stronger dollar, weaker international currencies, rising U.S. home prices, and restrictions by countries like China that are making it harder for citizens to invest abroad.

This drop in luxury demand was evidenced by the 6.4% bump in the number of $1 million-and-up homes sitting on the market from June 2015 to June 2016, according to the National Association of Realtors®. During the same period, the number of available homes priced between $100,000 and $250,000 dropped 12.5%.

The fine print on Trump-branded real estate

It’s difficult to determine the full extent of Trump’s real estate holdings, because he doesn’t actually own many of the buildings that bear his name. Instead, he often licenses his name for a fee to the developers of those projects.

The largest number of the two dozen or so U.S. residential buildings listed as “real estate portfolio” on the Trump Organization’s website are in New York, but there are also a handful of buildings in Florida as well as one each in Chicago; Las Vegas; Honolulu; Stamford, CT; and Jersey City, NJ. Some of these are combined hotel and condo projects. The analysis did not include his California properties or Virginia vineyard.

But it’s not immediately clear if Trump owns, or partly owns, all of these buildings, including the Trump International Hotel and Tower, Trump SoHo, and the Trump World Tower.

The Trump Organization declined to comment.

Dozens of additional buildings across the globe license the billionaire’s name as do products ranging from menswear to energy drinks.

Trump’s real estate licensing deals, brand, and branded developments were worth more than $3.32 billion in 2014, according to a financial summary he issued last year. In comparison, Trump only owned about $334.55 million worth of residential real estate in 2014, according to the one-page financial summary he issued when he launched his campaign.

Some buyers are turned off

While the long-term impact of Trump’s campaign on his real estate business is unknown, there have been some high-profile defections from his buildings since he kicked off his White House run in 2015.

Former MSNBC host Keith Olbermann made headlines in March after he declared he was moving out of his three-bedroom condo in Manhattan’s Trump Palace “because of the degree to which the very name ‘Trump’ has degraded the public discourse and the nation itself,” he wrote in an op-ed that ran in the Washington Post.

He sold the apartment in July, and the new owner has already put it back on the market.

“We had a few people say, ‘I don’t feel comfortable buying in a building with Trump’s name on it,'” says Daniel Neiditch, president of New York–based River 2 River Realty, a luxury real estate brokerage, landlord, and developer.

About half of Neiditch’s clients are foreign, and the Trump refusers have included a Mexican billionaire and a South American buyer who were offended by some of the candidate’s comments.

To date, most owners and potential buyers of Trump properties haven’t been dissuaded by the man’s public persona, say real estate agents across the U.S.

“His name still carries weight even though some people are offended by some things he’s said,” Neiditch says.

If Trump becomes president, what will happen to his real estate?

It Trump does indeed manage to snag the presidency next month, prices on his properties could go up, some agents believe. They could become status homes for foreign buyers, predicts luxury real estate agent Chris Fry of Elegran Real Estate in New York.

Running for president has given Trump, and his real estate, broad exposure. After all, he announced his candidacy in the lobby of his flagship property, the Trump Tower. And just last month, when he conceded that President Barack Obama was, in fact, born in the U.S., he did so in the newly opened Trump International Hotel in Washington, DC.

That sort of exposure can be good for Trump’s brand—and whatever his brand is selling, says Karen Post, president of Brain Tattoo Branding, an international branding consulting firm based in Tampa, FL. But until the election, it’s hard to tell what the majority of Americans think about Trump.

“The jury is definitely still out on what will happen to his brand,” Post says

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