Election Influences on Housing Market

With the 2024 Presidential election now behind us, you might be wondering what impact, if any, it will have on the housing market. Let’s break it down.

In any given year, home sales slow down slightly in the fall. It’s a typical, seasonal trend. However, according to historical data, in election years there’s usually a slightly larger dip in home sales in the month leading up to Election Day

Why? Uncertainty. Many consumers hold off on making major decisions or purchases while they wait to see how the election will play out. It’s a pattern that’s shown up time and time again, and it’s particularly apparent for buyers and sellers in the housing market.

This year is no different. A recent survey found that 23% of potential first-time homebuyers said they’re waiting until after the election to buy. That’s nearly a quarter of first-time buyers hitting the pause button, likely due to the same feelings of uncertainty.

The good news is these delayed sales aren’t lost forever – they’re just postponed. History shows sales tend to rebound after the election is over. In fact, home sales have actually increased 82% of the time in the year after the election.

That’s because once the election dust settles, buyers and sellers have a sense of what’s ahead and generally feel more confident moving forward with their decisions. And that leads to a boost in home sales.

So What Should We Expect in 2025?

If history is any indicator, that means more homes will sell next year. And based on the latest forecasts, that’s exactly what you should expect.

As this graph below illustrates, the housing market is on pace to sell a total of 4.6 million homes this year, well below previous years, yet current projections are for 5.2 million total sales next year

And that type of rebound aligns with the typical pattern of post-election recoveries. So while it might feel like the market is slowing down right now, most experts contend that it is a temporary dip rather than a long-term trend, especially if we see more relief in mortgage rates in the months to come.

Imagine More!