Understanding How Presidential Elections Impact the Housing Market

The upcoming Presidential election is right around the corner, and buyers, sellers and real estate professionals are all wondering how it will impact the real estate market. Every election year this question comes about, however the answer may surprise you.

Looking at past data, Presidential elections actually have very little impact on the housing market itself. Yes, some buyers and sellers feel uncertainty with a such a big change, but the lag that occurs because of this is temporary. Here are some insights into the housing market during a Presidential election:

Housing Prices

Right now, housing prices are still high but will the Presidential election change that? Looking at research, the election doesn’t heavily impact the current housing prices. Data from the NAR shows that after 7 of the last 8 Presidential elections home prices actually increased the following year. I know that sounds crazy to think the prices of homes could go up any higher than they are, but if history continues to repeat itself, we may see that. The good news is your sellers don’t have to worry about their homes losing value!

Home Sales

The past two years have seen a decline in home sales, but industry experts are predicting an up-tick in 2025. However, how will the Presidential election impact current home sales?

As we know, the winter months are when the housing market naturally slows down. When you add in a Presidential election year, you may see more of a decline in home sales than normal. Forbes.com says, “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%.”

This decrease in sales is due to people feeling uncertain to make big decisions during a time of change. But it’s important to remember this decline is only temporary, and the home sale trend usually stabilizes in December.

Interest Rates

Many potential buyers are waiting for interest rates to drop before they make a move. So now may be the perfect time! Freddie Mac released data that shows that out of the last 11 Presidential election years, mortgage rates decreased from July-November in 8 of them. That means we are most likely going to see lower rates for the next few months leading up to the election.

The Big Picture

It’s natural for us all to feel some unease during a pivotal time of change in our country. However,  when it comes to the housing market we can find some comfort in knowing it won’t be drastically impacted during the Presidential election period. According to Lisa Sturtevant, Chief Economist at Bright MLS, “Historically, the housing market doesn’t tend to look very different in presidential election years compared to other years.”

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