As the 2024 Presidential election approaches, you might be wondering how it will impact the housing market. Let’s break it down and take a look at the historical trends.
Election Years Bring a Temporary Slowdown
Home sales typically experience a slight slowdown in the fall, as the market follows seasonal trends. However, during election years, this dip tends to be a bit more pronounced, especially in the month leading up to Election Day. According to data from BTIG, this pattern is consistent across most election years:
Why does this happen?
The main factor is uncertainty. Many buyers and sellers hold off on making major decisions, including purchasing a home, as they wait to see the outcome of the election. This behavior has been a recurring trend, particularly in the housing market.
For example, a recent Redfin survey found that 23% of potential first-time homebuyers are waiting until after the election to make a move. That’s nearly a quarter of first-time buyers hitting pause, likely due to similar feelings of uncertainty.
Home Sales Tend to Bounce Back After the Election
The good news is that these postponed sales aren’t lost forever—they’re simply delayed. History shows that home sales tend to rebound after the election is over. In fact, home sales have increased 82% of the time in the year following a presidential election.
Once the election results are finalized, buyers and sellers have a clearer sense of what’s ahead and generally feel more confident about making decisions. This renewed confidence typically leads to an uptick in home sales.
What to Expect in 2025
Based on historical trends, we can expect home sales to pick up next year. Current forecasts indicate that 4.6 million homes are expected to sell this year, with projections for 5.2 million sales in 2025. This aligns with the typical post-election rebound pattern.
So, while it might feel like the market is slowing down now, it’s important to remember that this is likely a temporary dip. Once the election uncertainty passes, the market is expected to heat up again.
While election years often bring a brief slowdown in the housing market, it’s typically a short-term dip. Those delayed sales will eventually happen, and home sales usually surge the year after a Presidential election. With projections for a strong 2025, if you’re waiting for a clearer picture before making a move, know that the market is expected to gain momentum in the months ahead.
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