Presidential Elections are now in the news on a daily basis. And it’s just getting started. Primaries, caucuses, and debates are being held across the country. With just under 10 months away from voting day, the 2024 election cycle is ramping up. According to this Forbes article, “research and industry experts agree that the closer the election gets, the more likely its effects on housing, regardless of who the candidates are. In general, presidential races breed uncertainty in the housing market, which alters attitudes among home shoppers, sellers and investors and, thus, sways sale volumes and values.” Regardless of how it sways, it seems everyone has an opinion on how elections affect the housing market.
PUBLIC SENTIMENT
There are surely segments of the population who will hold off from making a decision to buy or sell a home until after the excitement of elections. “People do use an election as an excuse to delay selling or buying a home,” says Florida Realtor Cara Ameer. “Having worked in real estate through several presidential election cycles, I have observed that it can seem harder in an election year to move properties. People have fears and concerns, whether perceived or real, about an election outcome that may have them putting their real estate process on pause.” This was cited in Realtor.com article entitled, Should you wait until after an election to buy or sell a home?
Still, there are many others who make decisions for more personally impactful reasons. According to thebalancemoney.com, “People who sell houses may be motivated by the residence itself or the area around it. This doesn’t always mean there is something wrong with the home or the area, but the situation for the homeowners may have changed, requiring something different.” They are less swayed by an election year.
GOVERNMENT POLICY
The outcome of elections may likely dictate changes in government policies if a new party takes leadership. Different political parties have different approaches to economic and housing development. Some may focus on programs to make housing more affordable. They may encourage incentives to lenders who assist lower income households being able to purchase their first home. Others may focus more on commercial development with less attention to residential housing. Commercial development may help increase or decrease property values depending on the case.
HOUSING POLICY
Different political parties may have distinct approaches to housing policies, including affordable housing initiatives, rent control measures, and housing development regulations. Changes in these policies can have a direct impact on the real estate market, affecting property values and rental markets.
MONETARY POLICY
The outcome of an election can influence the monetary policies adopted by the government. For example, a government focusing on economic stimulus might encourage interest rates staying low to encourage borrowing and spending, potentially boosting the real estate market.
REGION AND AREA SPECIFIC
It’s important to note that the specific effects can vary based on the nature of the election, the prevailing economic conditions, and the unique characteristics of each real estate market. Additionally, local and regional factors play a significant role in determining how elections impact real estate at the community level.
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CLOSER TO ELECTION TIME
In a recent study that analyzed the last 13 presidential election years, which stretch back to the 1980s, Meyers Research, a housing consultancy firm, found out that new home sales record a drop in median sale activity of 15% from October to November, when the nation chooses its president. In the year following the election, the traditional seasonal decline in the sales of new construction abodes is only 8%. “Between 2008 and 2019, co-op sales began to dip in July of federal election years (both midterms and presidential elections), leading to a nearly 13% weaker market in September.” According to this Forbes article ,
BOTTOM LINE
If you are thinking of selling or buying a home in 2024, this being an election year may or may not change the landscape, especially as we move closer to November. The best advice we can offer is to stay up to date with the latest happening in your real estate market.
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