As the provisions of the “One Big Beautiful Bill” become clear, many property managers are asking, “What do the changes mean for our industry?” With new tax incentives and expanded support for development projects, 2025 IREM president Dawn Carpenter, CPM, and broker-owner of Dawning Real Estate Inc., AMO, in Staten Island, N.Y., believes the act will support and improve markets nationwide.
“I would say for affordable housing, it’s a decent win for communities and investors all over the country,” says Carpenter.
From affordable housing changes to opportunities for tax-advantaged improvements, the legislationgives property managers a way to help owners capture more value. Understanding these provisions will support them in taking full advantage of the benefits and applying them to properties moving forward.
Tax Incentives Spark New Projects
Among the act’s most significant components are tax incentives designed to support future property development and improvements for tenants. Carpenter explains that full-line depreciation for capital improvements may expand economic development in Opportunity Zones.
“These incentives also provide investors with a chance to put more money into their properties and still capture significant tax benefits at the end of the year,” says Carpenter. “The ability to depreciate tenant improvement allowances at 100% applies to both commercial and multifamily assets.”
Carpenter also notes the legislation will make the existing 12% increase in housing credit allocations permanent. Additionally, tax-exempt bonds are now another option to support affordable housing projects. This is a welcome addition, with housing shortages persisting in many parts of the country and communities in need of more availability.
Property Managers Planning Upgrades
Carpenter notes that the tax provisions took effect immediately, so property managers and their clients will see these changes in their 2025 and 2026 filings. She also explains the importance of managers coordinating with their accountants to make sure they’re capturing the full benefits and not missing out on valuable opportunities.
Property managers are already starting conversations and planning projects based on these tax incentives, according to Carpenter. “I can redo lobbies, put new carpeting down, and it’s 100% credits at the end of the year.” She also explains that this provides the ability to fully help clients rehab properties when needed, which can also increase rent values.
Balancing Benefits Against Drawbacks
While many aspects of the bill benefit property owners and managers, Carpenter does note one potential drawback: the loss of clean energy tax credits. For clients with existing solar installations, this is a meaningful change.
“I’m sitting inside a building that has 700 small solar panels on the lower roof and upper roof,” says Carpenter, “and my clients are losing their tax credit for that, so that does have impacts. We’re weighing that against some of the other changes that will take effect.”
At a high level, however, Carpenter believes the act will bring positive change for both current real estate investors and future renters, as they should gain access to more affordable housing options. As the provisions roll out, those who understand and plan for these changes will be best positioned to make the most of them.
For more insights and thought leadership from IREM on the One Big Beautiful Bill, click here.
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