How Trump’s Policies Could Ripple Through the Housing Market
13:18 Share

Amazon Q Business is the generative AI assistant from AWS because business can be slow, like wading through mud. But Amazon Q helps streamline work so tasks like summarizing monthly results can be done in no time. Learn what Amazon Q Business can do for you at AWS.com slash learn more.

A manhunt continues after an executive is shot dead in Manhattan. Plus, Ukraine opens talks with Donald Trump's team over halting the war with Russia. And how the president-elect's proposed immigration and trade policies could ripple through the housing market. Construction leaders are bracing for this causing the cost of housing to go up, which is...

problematic because actually lowering the cost of housing was a large part of the campaign. It's Thursday, December 5th. I'm Kate Bullivant for The Wall Street Journal, filling in for Luke Vargas. And here is the AM edition of What's News, the top headlines and business stories moving your world today.

The hunt for a suspect continues after UnitedHealthcare CEO Brian Thompson was shot dead yesterday outside a hotel in New York City in what police are calling a targeted attack.

Journal video correspondent Shelby Holliday filed this update from downtown New York as the New York Police Department ramps up its search. Now with the manhunt underway, police tell us they're also looking backward to see if there's footage of the suspect canvassing this area before the shooting. They also say they're analysing a cell phone that was found at the scene. For the latest updates on this developing story, you can visit WSJ.com.

Donald Trump has chosen Peter Navarro as a senior advisor on trade and manufacturing, signaling his determination to follow through on imposing tariffs on U.S. imports. Navarro, who also advised Trump on those areas during his first term, is a strong supporter of the President-elect's tariff pledge.

Trump has also said he would nominate former Representative Billy Long to run the Internal Revenue Service. If confirmed by the Senate, he would replace Danny Werfel, who was appointed by President Biden and was due to stay on until November 2027. Trump's decision to pick a new commissioner could signal a significant change in direction for the tax agency.

Meanwhile, Pete Hegseth, Trump's pick for defense secretary, said yesterday that he was not going anywhere as he fights to salvage his nomination amid snowballing allegations around his personal life that have raised concerns among Republican senators. Hegseth said he spoke to Trump yesterday morning and that he had his full support.

A bipartisan duo of senators is expected to propose legislation today to protect employees during corporate bankruptcies, the number of which rose by more than a third in the 12 months through September.

If passed, companies in bankruptcy would find it more difficult to give bonuses and other payouts to senior execs and consultants. And company insiders would be prevented from receiving retirement and health benefits if other employees lose those in bankruptcy.

WSJ Pro bankruptcy reporter Alicia McElhaney told us why Illinois Democrat Dick Durbin and Missouri Republican Josh Hawley chose now to put forward the bill, which they say would prioritize workers' wage claims.

What they're saying is that while the pace of bankruptcy has increased for corporations to restructure debt and continue operating, laws that protect employees have not kept pace.

Right now, what happens is employees are able to have priority claim of $10,000 worth of their wages. This bill would double that. So $20,000 per employee is a priority claim, and then they could get paid back more beyond that. It also makes it so that the claims don't have to be earned within 180 days of the bankruptcy. So if they've earned it before then, they can still get paid back.

Ukrainian officials have begun high-level talks with the incoming Trump administration on halting the war with Russia. According to a Trump transition official and several people familiar with the discussions, a top aide to Ukrainian President Volodymyr Zelensky met yesterday with Keith Kellogg. Trump's choice as special envoy for Russia and Ukraine, as well as incoming National Security Advisor Mike Waltz and Vice President-elect J.D. Vance.

However, there are wide differences between the two sides on what a deal to end the war should look like. Zelensky has recently signalled Ukraine could agree to a ceasefire if Ukraine were permitted to join NATO, something the Trump team has shown little interest in supporting.

In South Korea, President Yun Seok-yool has replaced the country's defence minister as opposition parties moved to impeach both men over the brief imposition of martial law earlier this week, which saw armed troops on the streets of Seoul. The departing defence minister earlier apologised, saying he ordered troops to carry out duties related to martial law. The main Liberal opposition Democratic Party is pushing for an impeachment vote on Saturday.

Airbus says it will cut around 2,000 jobs from its defence and space divisions as the aerospace giant seeks to reduce costs. The cuts amount to around 5% of the division's workforce and will mostly take place in Germany, France and the UK.

And in markets news today, Bitcoin is trading above $100,000 for the first time. It follows another surge after Donald Trump announced Paul Atkins, a crypto-friendly former regulator, as his pick to lead the Securities and Exchange Commission yesterday.

The world's largest digital currency has risen more than 40% in the four weeks since Election Day, setting one record after another amid hopes that Trump will turn US government policy into a growth engine for crypto. Members of the OPEC Plus are meeting today with the oil cartel and its allies expected to further delay a planned increase in output. Brent crude futures, the international oil benchmark, a little changed this morning.

And US initial weekly jobless claims are due out at 8.30am Eastern, following Jolt's job openings data that pointed to a solid labour market earlier this week. Coming up, the construction industry could face a double whammy from Trump's immigration and trade policies. We take a look at how serious the blow could be after the break.

Your business deploys AI pilots everywhere. But are they going anywhere? Or are they stuck in silos, exhausting resources, unable to scale? Maybe you don't need hundreds of AI pilots. You need a holistic strategy.

IBM has 65,000 consultants with Gen AI expertise who can help you design, integrate, and optimize AI solutions. So you're not just deploying AI, you're scaling it across your business. Learn more at ibm.com slash consulting. IBM, let's create.

The construction industry is bracing for a one-two punch if President-elect Donald Trump makes good on his promise to deport millions of undocumented immigrants and to introduce a new wave of tariffs on imports.

To help us unpack what this means for builders and for an already tight housing market, we're joined by journal reporter Elizabeth Findel. Elizabeth, why are people within the construction industry particularly worried about the immigration and trade policies that have been outlined by Trump? Right, yeah, people are worried because immigrants have always made up a significant portion of

of folks who work in construction and many of them are undocumented. There are official estimates of some 13% of the construction industry being undocumented workers.

Many of the builders that I've talked to said that by far the majority of workers who do a lot of the sort of basic work of things like framing houses and laying pipe are people who don't have documentation. And so if those folks were deported or even frightened enough that they weren't able to work, constructors would have a difficult time filling those positions, building houses on the tariff side.

Trump has proposed 25% tariffs on Canada and Mexico, which could impact construction materials.

A lot of wood is imported from Canada. There's a lot of steel that is imported. Overall, about 7.3% of home building materials are imported, according to the National Association of Home Builders. So construction leaders are bracing for this causing the cost of housing to go up, which is problematic because actually lowering the cost of housing was a large part of the campaign.

So have Trump and his team said anything about the impact of these policies? Not specifically. They have just said that they are going to work quickly to restore the economy. They've talked about reshoring American jobs, lowering inflation, raising wages, lowering taxes, cutting regulations. And

And can we look to the past for any examples of how similar policies have played out before? Well, we've seen deportation efforts before. A study by the Universities of Utah and Wisconsin found that when about 300,000 undocumented immigrants were deported between 2008 and 2013,

The counties that were affected lost about a year's worth of construction on average and new home prices went up 20 percent. OK, so what could this mean for the housing market? Trump has pledged to deport millions this time around. Yes, it's fairly clear from the builders that I talked to that if millions of people are deported and they include some of those construction workers or their family members, they're

That is going to mean higher home prices and it will just cool the industry overall at a time when there has been a real push to get more housing built because there are shortages in many parts of the country.

And places where we're seeing a lot of growth, particularly in Texas, housing prices have already gone up significantly. And so if you add to that by making the materials more expensive, reducing the workforce so that you can't build houses as quickly or you have to pay higher wages, you're

All of that makes housing more expensive. And Elizabeth, Trump frequently claimed on the campaign trail that immigrants are taking jobs from American workers.

And yet when it comes to construction, at least, you report that builders are already struggling to fill jobs. Yeah, builders are very concerned about finding workers. And most builders told me that even when they're paying good wages and even when unemployment in the country is very high, most native born Americans don't.

just aren't willing to take the most physically difficult jobs, particularly in areas of the country when they're doing them outside in over 100 degree heat. That was journal reporter Elizabeth Findel. Elizabeth, thanks so much for your time. Thank you. I appreciate it.

And that's it for What's News for Thursday morning. Today's show was produced by Daniel Bark with supervising producer Christina Rocker and I'm Kate Bullivant for The Wall Street Journal filling in for Luke Vargas. We'll be back tonight with a new show. Until then, thanks for listening.

What does the AI-powered future hold for the enterprise? And how can marketers catch the wave of the sea change to come? Find out on the debut episode of AI That Means Business, a new podcast from Google Cloud and custom content from WSJ.