How an Election Affects the Housing Market

Presidential elections often spark curiosity about their impact on the housing market. Do home sales fluctuate? What about prices and mortgage rates? Here’s a breakdown based on historical data and expert insights:

Home Sales Trends

Historically, presidential elections have shown a minimal, temporary impact on home sales. Typically, home sales remain steady throughout the year compared to non-election years, with a notable slowdown occurring in November. According to Ali Wolf, Chief Economist at Zonda, November tends to see slower activity.

Interestingly, in 9 out of the last 11 elections, home sales have actually increased the following year, indicating a post-election rebound in market activity.

Home Prices Outlook

When it comes to home prices, the general trend remains unaffected by election cycles. As Ryan Lundquist, an appraiser and housing analyst, notes, "An election year doesn’t alter the price trend that is already happening in the market." Over the past eight elections, home prices have shown increases post-election, with 2009 being the exception.

Mortgage Rate Expectations

Mortgage rates, a critical factor for buyers, often see fluctuations during election years. According to Freddie Mac data, in 8 out of the last 11 presidential election years, mortgage rates have decreased from July to November. Looking ahead to 2024, forecasts suggest a gradual easing of rates throughout the remainder of the year leading up to the election. This projection is welcome news for prospective buyers looking to enter the market with favorable financing conditions.

While presidential elections bring a certain level of uncertainty to various sectors, including housing, historical trends indicate that the housing market remains resilient overall. Whether you’re buying, selling, or simply monitoring market conditions, understanding these nuances can help you navigate the real estate landscape more confidently.

As we move closer to the upcoming election, staying informed about market dynamics and consulting with real estate professionals can ensure you make well-informed decisions. For personalized insights or assistance with your real estate goals, feel free to reach out to us. Let’s navigate the market together and achieve your housing objectives in 2024 and beyond!