How the 2024 Presidential Election Could Influence Real Estate

With the 2024 election coming to a close, many potential buyers and sellers are finding themselves unsure of how the outcome might impact the real estate market. In past election years, key trends have emerged in housing that offer some insight, though experts say the effects are often temporary.

Here’s a breakdown of what real estate professionals and economists expect in the months ahead.

A Temporary Slowdown in Home Sales

Historically, the fall season typically sees a natural dip in home sales following the summer peak. During election years, this trend is sometimes even more pronounced as buyers and sellers take a “wait-and-see” approach. Economist Lawrence Yun from the National Association of Realtors (NAR) noted that this year is no different, as some are delaying their decisions in response to the election atmosphere. However, once the results are clear, sales have often rebounded shortly afterward. For example, Realtor.com analysis shows an average 7% increase in home sales following previous presidential elections since 2004, with similar upticks expected this time around.  Not to mention, data from the Department of Housing and Urban Development (HUD) and the National Association of Realtors (NAR) shows that after nine of the last eleven presidential elections, home sales increased the following year.

Home Prices Tend to Rise, Not Fall

Historically, home prices have shown resilience during election cycles. Ryan Lundquist, a housing analyst, mentions that market conditions leading into the election typically carry through without major disruption. NAR data supports this, showing that prices rose following seven of the last eight elections. An exception to this pattern was the 2008 financial crisis, an anomaly with unique causes. Therefore, if your clients are concerned about declining home values due to the election, they can find reassurance in these historical trends.

Mortgage Rates May Ease

The interplay between politics and the economy often leads to fluctuations in mortgage rates. According to Freddie Mac, rates have tended to fall in election years from July through November. This trend is expected to hold in 2024, with forecasts pointing to some rate easing, albeit gradual, as the Federal Reserve manages inflation and economic stability. Danielle Hale, Chief Economist at Realtor.com, suggests that while elections can amplify rate volatility, most economists agree that broader economic indicators ultimately dictate rate trends.

Bottom Line

For clients feeling uncertain about how the 2024 election could impact real estate, history suggests that election-year impacts are usually temporary. While elections create momentary buyer hesitancy, post-election confidence and economic fundamentals tend to restore market momentum. It’s essential for real estate professionals to stay informed, enabling them to guide clients confidently through these unique times.

Whether the real estate market responds like it has historically or we see changes, Connexa Real Estate is here to help. By understanding these patterns, we can help clients focus on their long-term goals and reassure them that housing trends remain resilient amid political changes. Reach out if you're unsure about your next steps and how the election results could affect your goals. Together, we'll figure it out!