With the 2024 Presidential election approaching, many are curious about its potential effects on the housing market. Let’s explore the trends and implications.
Temporary Slowdown During Election Years
In any year, home sales tend to slow slightly in the fall due to seasonal trends. However, data from BTIG indicates that during election years, there’s often a more significant dip in sales in the month leading up to Election Day. Why does this happen? The answer is uncertainty. Many consumers hold off on major decisions or purchases while waiting to see how the election unfolds. This pattern has been observed consistently, especially among buyers and sellers in the real estate market.
This year, we’re seeing similar behavior. A recent Redfin survey found that 23% of potential first-time homebuyers are postponing their purchase until after the election. This pause reflects the uncertainty that many first-time buyers are experiencing.
Post-Election Sales Surge
The good news is that these delayed sales are typically not lost; they are merely postponed. Historical data shows that home sales often rebound after elections. 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 generally gain clarity and confidence, prompting a surge in transactions.
What to Anticipate in 2025
If history serves as a guide, we can expect more homes to sell next year. Current forecasts support this expectation, predicting a total of 4.6 million homes sold this year, with projections rising to 5.2 million sales in 2025. This aligns with the typical post-election rebound pattern.
So, while it may seem like the market is slowing down now, it’s more of a temporary dip rather than a long-term trend. Historically, once the uncertainty of an election subsides, both buyers and sellers return to the market.
It’s essential to understand that while election years often bring about a short-term slowdown in the housing market, this pause is usually temporary. Those sales aren’t lost—they tend to resurface in the following year. Data indicates that home sales typically rise after a presidential election, and forecasts suggest that 2025 will continue this trend. If you’re waiting for a clearer outlook before making a move, rest assured that the market is expected to gain momentum in the coming months.
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