Market Projections: Navigating the Real Estate Landscape During an Election Year
Article published in Longmeadow Neighbors
(September 2024)
EXPERT CONTRIBUTOR
BRENDA CUOCO, Licensed in MA & CT
Brenda Cuoco & Associates
Real Estate Brokerage
413 333 7776
Brenda@WMassHomeBuyer.com
WMassHomeBuyer.com
As the presidential election approaches, the real estate market tends to experience notable shifts that can impact both buyers and sellers. Understanding these patterns is crucial for making informed decisions. Here's an in-depth look at market projections and trends based on historical data during election years.
Decrease in Home Sales Leading Up to the Election
Historically, the period leading up to a presidential election, particularly from October to November, sees a decline in home sales. On average, sales decrease by about 15% during this time. The uncertainty surrounding potential changes in government policies often makes buyers and sellers cautious, leading to a slowdown in market activity.
Post-Election Market Rebound
Interestingly, the real estate market tends to rebound strongly in the year following a presidential election. In 9 out of the last 11 presidential elections, home sales have increased in the year after the election. This trend suggests that once the uncertainty is resolved and new policies begin to take shape, confidence in the market returns, and activity picks up.
Rising Home Prices Post-Election
Home prices also tend to rise after a presidential election. In 7 out of the past 8 presidential elections, prices have seen an upward trend in the following year. This increase can be attributed to renewed market confidence, economic stability, and potential policy changes that positively impact the housing market.
Mortgage Rates Trends During Election Years
Mortgage rates often exhibit a pattern of slight decline leading up to the election. In 8 out of the past 11 election years, rates have decreased from July to November. Lower mortgage rates can make buying a home more attractive, offsetting some of the market's inherent caution during this period.
Navigating the Market as a Buyer or Seller
Given these trends, here are some strategies to consider:
For Buyers:
1. Take Advantage of Stabilized Mortgage Rates: With mortgage rates typically declining leading up to the election, this period can be an excellent time to secure a favorable rate.
2. Be Patient: If you don’t find the perfect home before the election, don't be discouraged. The market tends to pick up in the following year, providing more opportunities.
For Sellers:
1. Plan Ahead: Be mindful of the potential slowdown in sales leading up to the election. If possible, list your home before October or be prepared for a slightly longer selling process.
2. Consider Post-Election Timing: If you can wait, the year following the election might be a better time to sell, as the market typically rebounds, and home prices tend to rise.
Understanding the historical patterns of the real estate market during and after election years can help you make more informed decisions. Whether you’re buying or selling, keeping these trends in mind will better prepare you for the fluctuations that come with the political landscape. As always, staying informed and working with a knowledgeable real estate professional can provide you with the best guidance through these uncertain times.
*Information provided from David Childers and the Tom Ferry Network.
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