What’s the Impact of Presidential Elections on the Housing Market?

It’s not a surprise that the upcoming Presidential election may have you hypothesizing about what’s ahead. And those unanswered ideas can quickly spiral, causing fear and uncertainty to swirl through your mind. If you’ve been thinking about buying or sellinga home this year, you’re most likely curious about what the election might suggest for the housing market— and if it’s still a great time to make your move.

Here’s fortunately that may surprise you: normally, Presidential elections have only had a small, short-lived influence on the real estate market. However your concerns are definitely worth answering, so you don’t need to pause your strategies in the meantime.

Here’s a take a look at years of information that reveals exactly what’s taken place to home sales, prices, and mortgage rates in previous Presidential election cycles, so you can move on with the realities as you weigh the benefits and drawbacks of your homeownership choice.

Home Sales

In the month leading up to a Presidential election, from October to November, there’s typically a small slowdown in home sales( see graph listed below):

Some customers will simply wait it out before they make their purchase decision. It’s essential to understand this downturn is momentary and small.

Historically, home sales bounce right back and continue to increase the following year.

In truth, data from the Department of Housing and Urban Development( HUD) and the National Association of Realtors( NAR) shows after 9 of the last 11 Presidential elections, home sales went up the year after the election, and it’s been taking place consistently since the early 1990s (see chart below):

Home Prices

You might also be questioning home costs. Do prices come down during election years? Not generally. As residential appraiser and housing expert Ryan Lundquist notes:

” An election year does not change the cost pattern that is currently occurring in the market.”

Home costs typically increaseover time, despite an election cycle. So, based upon what history programs, you can expect the present prices pattern in your regional market to most likely continue, disallowing any unusual market or financial scenarios.

The most recent informationfrom NAR exposes that after 7 of the last 8 Presidential elections, home rates increased the following year ( see chart listed below):

The one outlier was from 2008 to 2009, which was during the height of the housing market crash. That was certainly not a typical year. Today’s market,however, is much more durable. And while prices are moderatingnationally, they aren’t on an overall decline.

Home mortgage Rates

And the third thing that’s likely on your mind is home loan rates, considering that they affect your monthly payment if you’re funding a home. Taking a look at the last 11 Presidential election years, informationfrom Freddie Macprograms mortgage rates reduced from July to November in 8 of them ( see chart listed below):

And this year, we’ve currently begun to see that happen. Many professionals also forecast home mortgage rates will relieve a little throughout the rest of 2024. If that occurs– and all signs today indicate it ought to– this year will continue to follow the pattern of decreasing rates. If you’re looking to buy a home in the coming months, this could be terrific news for your acquiring power.

What This Means for You

What’s the big takeaway? While Presidential elections do have some influence on the housing market, the effects are usually very little. As Lisa Sturtevant, Chief Economist at Bright MLS, says:

” Historically, the housing market doesn’t tend to look very different in presidential election years compared to other years.”

For a lot of purchasersand sellers, elections don’t have a major impact on their strategies.

Bottom Line

While it’s natural to feel a bit unsure throughout an election year, history shows the real estate market stays resilient and strong. And this indicates you don’t need to pause your strategies in the meantime. For aid navigating the market throughout this election cycle, let’s link.

It’s no surprise that the upcoming Presidential election may have you hypothesizing about what’s ahead. Do prices come down throughout election years?, considering that they affect your regular monthly payment if you’re financing a home. If that takes place– and all signs right now show it ought to– this year will continue to follow the pattern of decreasing rates. While it’s natural to feel a bit uncertain during an election year, history reveals the real estate market remains resistant and strong.