Do Elections Impact the Housing Market?

The 2024 Presidential election is just months away. If you’re considering buying or selling a home, you might wonder how elections affect the housing market. It’s a crucial question, as buying or selling a home is a major decision, and understanding the potential impacts can help you make informed choices.

Historically, Presidential elections have only had a small, temporary impact on the housing market. Here’s a look at what typically happens to home sales, prices, and mortgage rates during election periods.

Home Sales

During November of Presidential election years, there’s typically a slight slowdown in home sales. Ali Wolf, Chief Economist at Zonda, explains:

“Usually, home sales are unchanged compared to a non-election year with the exception being November. In an election year, November is slower than normal.”

This slowdown is mainly because some people feel uncertain and hesitant about making big decisions during such a pivotal time. However, this slowdown is temporary. Historically, home sales bounce back in December and continue to rise the following year. Data from the Department of Housing and Urban Development (HUD) and the National Association of Realtors (NAR) shows that after nine of the last eleven Presidential elections, home sales increased the next year.

Home Prices

What about home prices? Do they drop during election years? Not typically. Residential appraiser and housing analyst Ryan Lundquist says:

“An election year doesn’t alter the price trend that is already happening in the market.”

Home prices are generally resilient and tend to rise year-over-year, regardless of elections. The latest data from NAR shows that after seven of the last eight Presidential elections, home prices increased the following year. The only year when prices declined after an election was during the housing market crash, which was an exceptional circumstance. Today’s market conditions are quite different from those of the past.

Mortgage Rates

Mortgage rates are crucial because they affect how much your monthly payment will be when you buy a home. Looking at the last eleven Presidential election years, data from Freddie Mac shows mortgage rates decreased from July to November in eight of them. Most forecasts expect mortgage rates to ease slightly throughout the remainder of the year. If they’re correct, this year will follow the trend of declining rates leading up to most previous elections. For potential homebuyers, lower rates could mean a lower monthly payment.

What This Means for You

So, what’s the big takeaway? While Presidential elections do have some impact on the housing market, the effects are usually small and temporary. Lisa Sturtevant, Chief Economist at Bright MLS, states:

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

For most buyers and sellers, elections don’t significantly impact their plans. If you’re in San Antonio, TX, including desirable areas like Champions Ridge, North San Antonio, and Stone Oak, it's a good idea to stay informed but not overly concerned.

Bottom Line

While it’s natural to feel uncertain during an election year, history shows the housing market remains strong and resilient. For help navigating the market, election year or not, let’s connect. Schedule a call with me here, and click this link to get your home valuation. Let’s work together to make your home buying or selling experience as smooth and successful as possible.