How Presidential Elections Influence The Real Estate Market

Presidential elections can significantly impact the real estate market, particularly in the months following the election. While it’s common to see a slight slowdown leading up to Election Day, historical data shows that the housing market often rebounds and even thrives post-election.

Post-Election Market Performance

Home Sales Surge

The real estate market has a proven track record of resilience after presidential elections:

• In 9 out of the last 11 elections, home sales increased in the year following the election.
• This suggests that any hesitation among buyers and sellers before the election tends to fade once the political uncertainty clears up.

Price Appreciation Trends

Home prices also show strong upward momentum after elections:

• Existing home prices rose after 7 of the last 8 elections.
• New home prices experienced even greater growth, increasing after 10 of the last 11 elections.

These trends demonstrate that the housing market often experiences a boost in both confidence and activity once election results are settled.

Factors Driving Post-Election Growth

Mortgage Rate Reductions

One of the key factors contributing to post-election market growth is the drop in mortgage rates:

• After 8 of the last 11 elections, mortgage rates fell.
• Lower rates make homeownership more affordable and stimulate demand, which helps fuel the market.

Economic Clarity

Another factor is the increased economic clarity that often comes after an election:

• With the political landscape set, businesses and consumers gain a clearer picture of future policies.
• This clarity can restore consumer confidence, leading to real estate transactions that were previously postponed.

The Post-Election Bounce

While elections may cause some short-term uncertainty in the real estate market, history shows that the post-election period often brings growth and stability. Home sales, prices, and mortgage rates have all demonstrated positive trends following most elections, making it a time of opportunity for buyers and sellers alike.

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