Election and Real Estate
How Elections Impact Real Estate
Hi, I’m Steve Smith from Irish Realty, and as we dive into this election season, many are curious about how the results might influence the real estate market. While every election brings some level of uncertainty, it’s important to remember that, historically, real estate has shown resilience through these periods. Let’s break down some of the ways elections impact the housing industry and why now could be a great time to make your move.
When it comes to real estate, elections can influence several areas of concern:
- Tax Policies: Changes in capital gains rates, property tax incentives, and overall tax policy are key for both buyers and sellers.
- Interest Rates and Federal Monetary Policy: Monetary policy is one of the biggest areas of concern, as it impacts the affordability of loans for buyers and, in turn, influences market demand.
- Economic Growth and Job Creation: A healthy economy drives demand for real estate, and certain policies can directly or indirectly affect job creation, income stability, and growth.
- Environmental Policy and Development: Policies on environmental protections, zoning, and land use affect what can be built, where, and how, influencing development timelines and locations.
Why Now is a Great Time to Buy or Sell
The good news is that election cycles often have only a brief, minor effect on real estate. Historically, in the month leading up to an election, sales might dip slightly as buyers and sellers wait for results. However, this is typically followed by a strong rebound. In fact, in the last eight presidential elections, housing prices and demand have generally increased the year following the election.
Why? For one, household income tends to remain steady regardless of which candidate wins. With a stable economic environment, buying power largely remains unaffected, allowing people to move forward confidently with real estate decisions.
Currently, interest rates have dropped significantly, moving down from around 8% last October to the low sixes. This rate drop means greater affordability for buyers, and as rates fall, demand is likely to rise. With our current low supply, increased demand will put upward pressure on home prices, making it an opportune time to sell.
For buyers, lower rates mean increased buying power, allowing them to afford more home for the same monthly payment compared to last year. If you’ve been waiting, hoping for prices to drop, historical trends suggest that’s unlikely in the near future. Instead, a combination of high demand and limited inventory could keep prices moving upward.
Market Strength Beyond the Election
Regardless of the outcome this November, the housing market is expected to remain strong. Low supply, dropping interest rates, and steady buying power all support a positive outlook. For sellers, it’s a chance to meet eager buyers in a market that favors well-priced homes. For buyers, now may be the best time to secure a lower rate and increase your purchasing power before demand potentially drives prices up.
So, remember to vote, exercise your right, and know that historically, elections have had only short-term effects on real estate. The long-term fundamentals remain strong, and with the right guidance, you can make the most of this moment in the market.
Give me a call at 574-360-2569. Let’s talk about how we can navigate this market together and get your home sold for the best price.