As the recent election season comes to a close, many people are wondering how it will affect the housing market. Historically, presidential elections have a temporary, minor influence on home sales, mortgage rates, and home prices. Here’s a breakdown of key insights based on data from previous election years:
1. Does an Election Slow Down the Housing Market?
- Typical Year: Home sales typically decrease by 9.8% from October to November.
- Election Year: Sales tend to drop more—15% in an election year.
- This Year: 23% of first-time buyers are waiting until after the election to make a purchase, reflecting the added uncertainty.
2. Do More Homes Sell After an Election?
- Typical Year: After a dip, homes generally bounce back, with sales increasing about 82% of the time the following year.
- This Year: Experts are forecasting that home sales will rise to 5.2 million, and are projected to grow further, reaching up to 6 million by 2025.
3. What Happens to Mortgage Rates During an Election Year?
- Typical Year: From July to November during election years, mortgage rates have decreased 72% of the time.
- This Year: Rates have been volatile, with averages around 6.08% in September. However, rates have come down from the 8%+ range last year, signaling some relief for buyers.
4. What Happens to Home Prices After an Election?
- Typical Year: Home prices tend to rise 88% of the time in the year following an election.
- This Year: Home prices are expected to continue rising at a rate of 2.5% in 2025, based on national projections.
While presidential elections may cause short-term shifts in the housing market, these impacts are generally small and temporary. The broader trends in housing often resume quickly after the election cycle concludes. Home prices and sales should remain relatively stable over the long term, making now a great time to buy or sell—especially if you are prepared to weather the election-related changes.
If you have any questions about how these changes might impact your real estate decisions, don’t hesitate to reach out. Let’s work together to make informed decisions in this dynamic market!