August Real Estate Roundup: The Myth of Elections Affecting the Housing Market

With 2024 being an election year, it may seem that “unknown” will have a big impact on the housing market. You might have clients wondering if they should purchase now or wait until after November. Because so much of the news cycle is dedicated to the election, it makes sense your buyers might feel it’s best to wait. 

But the data shows that elections affecting the housing market is mostly a myth. 

As you know, the housing market’s performance is comprised of many factors, like supply, prices, and interest rates. These factors alone have proven to have a greater impact, historically, on the markets than any presidential election. 

For example, regardless of which candidate wins, most Americans will actually see no immediate effect on their income; they should not pause their decision to buy based on an election alone.  

Learning from History 

Housing economists also underscore that elections don’t affect home values in any real way. The S&P CoreLogic Case-Shiller Home Price Index shows that when you look at the nine elections since 1987, home price appreciation in those years actually outperformed appreciation in the other 28 non-election years since. 

Take 2008, one of the worst-ever years for the housing market. But according to Case-Shiller, that had little to do with the Barack Obama-John McCain election race – it was simply bad economic timing. The historic housing bubble of 2004 to 2007 had finally burst. 

Similarly, home values rose 13.4% in 2004, mostly due to the inflated housing bubble, not George W. Bush’s re-election. And in 2021, home values rose 18.9% amid record-low mortgage rates and the Covid pandemic housing boom, not because it was Joe Biden’s first year in office.  

A Market Bigger Than Campaign Speeches 

So, to sum up, although presidential candidates talk a lot about their economic plans, the truth is, presidents - and those who want to be - have little to no influence on a market as big and broad as the U.S. housing sector. I’d love to talk to your clients to remind them: 

• We can never fully predict the markets, but… 

• Rates are trending downward, and buying now can also mean tax benefits in 2025. 

• Their home loan is based on many factors that only the buyer controls (assets, credit, etc.), not an election. 

• Whether your client is ready to buy or still unsure, they can go ahead and get pre-approved so they’ll know exactly what they can afford when it’s time to shop.

I’m always here to help – just reach out!