Fact or Fiction: How Presidential Elections Influence the Housing Market
As the Presidential election draws near, many find themselves pondering the potential impact on the housing market. It's natural to feel uncertain during such times, especially if you're considering buying or selling a home. The good news is that historical data suggests Presidential elections typically have only a minor and temporary effect on the real estate market. Let's dive into the details to understand what this means for you. Do Elections Really Affect Home Sales? One of the most common concerns is whether home sales slow down during an election year. The truth is, there’s usually a slight dip in home sales in the months leading up to the election, particularly from October to November. This is likely due to some buyers and sellers adopting a "wait and see" approach as they anticipate the election's outcome. However, this slowdown is typically brief. Historical data from the National Association of Realtors (NAR) and the Department of Housing and Urban Development (HUD) shows that after 9 out of the last 11 Presidential elections, home sales rebounded and increased the following year. This consistent trend suggests that any hesitation is temporary, and the market quickly returns to its usual activity. In the month leading up to a Presidential election, from October to November, there’s typically a slight slowdown in home sales (see graph below): Are Home Prices Affected During Election Years? Another key question is whether home prices tend to drop during election years. According to historical trends, the answer is no. Home prices generally follow the broader market trends rather than being significantly influenced by the election cycle. As residential appraiser Ryan Lundquist points out: “An election year doesn’t alter the price trend that is already happening in the market.” In fact, data from NAR indicates that after 7 out of the last 8 Presidential elections, home prices increased in the following year. The only exception was during the 2008-2009 period, which was marked by the housing market crash—a scenario far different from typical election years. In fact, data from the Department of Housing and Urban Development (HUD) and the National Association of Realtors (NAR) shows after 9 of the last 11 Presidential elections, home sales went up the year after the election, and it’s been happening consistently since the early 1990s (see chart below): The latest data from NAR reveals that after 7 of the last 8 Presidential elections, home prices increased the following year (see chart below): The one outlier was from 2008 to 2009, which was during the height of the housing market crash. That was certainly not a typical year. Today’s market, however, is much more resilient. And while prices are moderating nationally, they aren’t on an overall decline. The Impact on Mortgage Rates Mortgage rates are another area of concern during election years, as they directly affect your financing options. Historical data from Freddie Mac shows that in 8 out of the last 11 Presidential election years, mortgage rates decreased from July to November. This year, we’re already seeing a similar pattern. Many experts predict that mortgage rates will continue to decline throughout the rest of 2024, which could be great news for buyers looking to secure favorable financing terms. What Does This Mean for You? The bottom line is that while Presidential elections can cause some short-term uncertainty, they usually have minimal long-term impact on the housing market. As Lisa Sturtevant, Chief Economist at Bright MLS, says: “Historically, the housing market doesn’t tend to look very different in presidential election years compared to other years.” For most buyers and sellers, there’s no need to put your plans on hold because of an election. Conclusion While it’s natural to feel cautious during an election year, history shows that the housing market remains resilient. If you’re considering buying, selling, or investing in real estate, there’s no reason to delay your plans. Ready to take the next step? Contact David Smith, team leader of Blok & Blvd. Realty at Compass Real Estate. With over 21 years of experience in the Houston real estate market, I’m here to guide you through any uncertainties and help you make informed decisions. Reach out to me at 281-732-3090 or david@blokblved.com. Let’s work together to achieve your real estate goals, no matter what the election year brings.
Market Shift? Here’s How to Thrive, Not Just Survive
Market Shift? Here’s How to Thrive, Not Just Survive After years of intense buyer demand, low mortgage rates, and fierce competition, the real estate market is rapidly changing—and this shift is impacting both buyers and sellers. Rising mortgage rates have made it difficult for many buyers to stay in the race for their dream home. Meanwhile, sellers who were waiting for the perfect time to maximize their profit are now witnessing a moderation in home prices, a slight easing of mortgage rates, and an increase in inventory levels. This evolving market is changing the rules for everyone involved. It’s natural to feel unsettled by these changes, but it’s important to remember that change is a constant in the real estate market. Over the past five, ten, even twenty years, the market has experienced numerous shifts, and those who have adapted have continued to succeed. If you’re looking to buy or sell in this shifting real estate market, the key to thriving is staying informed and being adaptable. But one thing remains constant: our commitment to helping you navigate this journey. While the future may seem uncertain, one thing is clear: working with a knowledgeable and experienced realtor who can communicate their value and provide clear guidance is more crucial now than ever before. If you’re feeling unsure or overwhelmed about the current state of the real estate market, know that you’re not alone. The right guidance and a willingness to adapt are essential to achieving your real estate goals. Whether you’re buying or selling, thriving in this market requires staying informed, being flexible, and working with an experienced realtor who understands your needs. As the real estate market continues to shift, having the guidance of a seasoned and trusted realtor is more important than ever. Navigating these changes requires expertise, experience, and a deep understanding of market trends. Whether you’re looking to buy or sell, I’m here to provide the support and insight you need to make informed decisions and achieve your goals. Don't let uncertainty hold you back—let’s take the next step together. Contact me today to discuss your real estate needs, and let’s create a strategy that ensures you thrive in this evolving real estate market. David SmithBlok & Blvd. Realty Group with Compass Real EstatePhone: 281-732-3090Email: david@blokblved.com Reach out now to start the conversation, and let’s turn today’s challenges into tomorrow’s opportunities.
Is the Housing Market Shifting? Here’s What You Need to Know
Is the Housing Market Shifting? Here’s What You Need to Know As a potential homebuyer or seller, you’ve likely noticed that the housing market has been heavily favoring sellers over the past couple of years. However, with the recent increase in housing inventory, many are beginning to question whether this trend is beginning to shift. Understanding these changes is crucial for anyone looking to navigate the real estate market effectively. Here’s a breakdown of the current market conditions and what they mean for you. What Is a Balanced Housing Market? A balanced housing market is defined by a five-to-seven-month supply of homes for sale. In such a market, both buyers and sellers have equal negotiating power, leading to stabilized home prices and a wider selection of homes for buyers to choose from. After years of a strong seller’s market, many are hoping for a shift toward a more balanced market. Current Inventory Levels: Moving Toward Balance At the start of the year, the national real estate market had a three-month supply of homes. Recently, this has increased to a four-month supply. While this may seem like a small change, it’s a step toward a more balanced market. However, it’s important to note that this increase in inventory doesn’t indicate an oversupply or a looming market crash. There’s still a long way to go before reaching those levels. Why It’s Still a Seller’s Market (For Now) Despite the growing inventory, we remain in a seller’s market. However, the frantic pace and intense competition seen in recent years are beginning to cool. Mark Fleming, Chief Economist at First American, states: “The faster housing supply increases, the more affordability improves, and the strength of a seller’s market wanes.” How the Market Shift Affects You Whether you’re buying or selling, these market changes could impact your real estate strategy: Homes Are Taking Longer to Sell: With more homes available, properties aren’t selling as quickly as they once did. For buyers, this means more time to find the perfect home. For sellers, pricing your property competitively is key to attracting buyers and closing the deal. Fewer Offers on Homes: Sellers are receiving fewer offers, which might require more flexibility on price or terms to secure a sale. Buyers, on the other hand, may face less competition and enjoy a broader selection of homes. Buyers Less Likely to Waive Inspections: As buyer negotiation power increases, fewer are waiving inspections. Sellers should be prepared to address any repair requests to keep the sale moving forward. The Importance of Local Market Insights While the national trends provide a broad overview, real estate markets can vary significantly by location. That’s why it’s essential to work with a local real estate agent who can provide up-to-date data and insights specific to your area. As the Team Leader of the Blok & Blvd Team with Compass Real Estate, I, David Smith, can help you understand how these changes affect your local market. Whether you’re looking to buy or sell, I’m here to guide you through the process with the latest market data and expert advice. Contact me today at 281-732-3090 or david@blokblvd.com to discuss your real estate needs and take advantage of my local market expertise.