How Do Presidential Elections Impact the Real Estate Market?

The presidential election is fast approaching, prompting important considerations for buyers and sellers. Considering the year’s uncertainties, some clients may already be re-evaluating their real estate plans, with the upcoming election adding further questions to their decision-making process.?

Real estate has taken a prominent role in the pre-election discourse, and while clients might not be voicing their concerns directly, they are probably thinking about how the results could affect their decisions.?

Examining how previous elections have shaped the market and considering the unique factors influencing today’s environment to address these concerns effectively is crucial. By staying informed, you can provide clients with valuable insights and guidance, empowering them to make confident and well-informed decisions during this pivotal period.?

Housing Market After 2024 Election?

As the 2024 presidential election approaches, many wonder how it will affect the housing market. Historically, election years can bring uncertainty, but past trends offer valuable insights into what may happen in the months following the election. Some of the important points are:?

Home Sales Could Slow, but Will Rebound Quickly?

Home sales tend to slow down in the fall after the busy spring and summer seasons. But how will the upcoming election affect this trend??

Home sales generally stay steady during an election year, except for a slowdown in November. This dip occurs because people tend to be cautious about making big financial decisions during election season. However, this slowdown is only temporary. Home sales pick up again in December and continue to rise in the following year, showing resilience even after the election uncertainty passes.?

Research from the Department of Housing and Urban Development (HUD) and the National Association of Realtors (NAR) supports this. After nearly every presidential election, home sales increased the following year.???

Given today’s strong and competitive real estate market, any slowdown during the election season can be brief, with home sales bouncing back in the months ahead, just as they have in the past.?

Home Prices Usually Rise, not Fall?

Election years generally do not disrupt home prices, as the real estate market tends to remain stable and resilient. Historical data shows that home prices typically increase year-over-year, even during election cycles. According to the National Association of Realtors (NAR), home prices rose after every presidential election, with the only exception being during the 2008 housing market crash, a unique and extraordinary event.?

This consistent trend highlights the market’s ability to withstand political uncertainty, reassuring buyers and sellers alike. Home prices usually continue to rise in the year following an election, making concerns about a potential drop in home values largely unwarranted. The combination of strong market fundamentals and ongoing demand ensures that the housing market remains a strong investment, even in election years.?

Mortgage Rates Likely to Continue Trending Down?

The economy, politics, and real estate are closely intertwined, and mortgage rates are no exception. Research from Freddie Mac shows that in eight of the last eleven presidential election years, mortgage rates declined between July and November.?

Several forecasts predict slightly easing mortgage rates for the remainder of this year. If this trend continues, it will align with the pattern observed in previous election years. Although a significant drop is not expected, a steady rate decline would improve affordability for many buyers, offering a more favorable environment for those looking to purchase soon.?

The recent volatility in mortgage rates may calm, providing some relief to the market.?

Conclusion?

Although presidential elections can impact the housing market, these effects are typically minor and short-lived. Real estate professionals should stay updated on market trends and data to help clients make informed decisions. Agents can provide clarity and confidence during uncertain times by understanding how election cycles influence buyer and seller behavior. Staying informed ensures that you can guide your clients effectively, even when political factors create temporary hesitation in the market.?